Spending the last week traveling through Australia, visiting a manufacturer, giving presentations and talking with several other companies after my presentations has been fascinating. Before saying anything else, I have to compliment this nation and its people — they are kind, humorous and have a ton of class.
Land of Pragmatic Processes
What’s so refreshing about Australian manufacturers’ approach to using enterprise software for selling, serving and communicating with customers is that pragmatism rules. Relationships clearly rule much more than the allure of automating some or all of their CRM, order management, quoting or pricing functions. Manufacturing here is still very much green-field for ERP and CRM, and in that opportunity is the challenge of selling not the most feature-laden manufacturing, service or customer suite, but taking the time to truly understand these manufacturer’s specific needs.
In a sense, the pragmatism of Australian manufacturers forces vendors to see the world not through product features, functions and benefits but through being process experts in their industries. If all this sounds familiar, it’s the heart of solution selling and becoming a trusted advisor and is the future of enterprise software globally.
With so much said about solution selling and being process-centric in defining how and where manufacturers need to apply applications to their companies globally, it’s refreshing to see CFOs of smaller Australian manufacturers create benchmarks to measure the payback of this approach. These CFOs aren’t running huge databases and spending thousands on analytics applications, but what they are doing is slowing and steadily changing how their businesses operate. Here’s some lessons learned from an Australian CFO I spoke with who is revolutionizing his company. His comments reflect this country’s extremely pragmatic view of IT in general and customer management specifically:
- Relationships are another word for sales. In industry after industry here, it is amazing how close-knit and tight customers and manufacturers are. Any given industry’s top sales professional might as well have “Relationship Manager” on their business card because that’s what they spend the majority of their time on. I asked the CFO, “What about improving order accuracy and what about tracking the effectiveness of sales strategies?” Order accuracy gets measured by the production scheduler in finance, and sales effectiveness gets measured by a simple dashboard driven from order capture systems, he said.
- Clarifying customer forecasts on customized products. A global issue for many manufacturers, sharing and making sure forecasts are accurate, current and clear enough to plan manufacturing from is particularly challenging in Australia given the global supply chain manufacturers here contend with. Many manufacturers here rely on subassemblies and raw materials from offshore, making the need for stable forecasts critical. Instead of putting in price restrictions on changing forecasts, one Australian manufacturer asks the customer to assist in paying air freight for raw materials to complete the order, and in another instance the CFO asked for and got customer planning meetings at the beginning of every month to better anticipate emergency orders and demand.
- Supply chains are the customer strategy of choice for manufacturers. For all the pragmatism around customer relationships, supply chains here are much more critical and get much more attention. Forecasting with suppliers at a few smaller manufacturers is handled through hosted portals to enable 24/7 communications and support. There’s a shift from European and American suppliers to Asian ones, and the need for Kanji and Chinese language support in supplier portals is a growing business. The Asian influence on Sydney’s manufacturing is unmistakable, as it is in the culture of the city. Supply chains win business and keep customers happy here; perhaps that is the heart of their pragmatism of relationships that is unmistakable in this country.
Subsidiaries: A Breed Apart
Of the software companies that have subsidiaries here, I noticed that many of them are a breed apart. It’s immediately clear that given the highly pragmatic approach manufacturers take towards software, their subsidiaries are required to have a correspondingly unique set of attributes on their part. Not everyone can work in a software subsidiary here; it takes a very specific set of attributes which include the following:
- Aggressive patience. First, sales cycles here can at times be lengthened by changes in applications, services, selling strategies and pricing back at corporate.
- Strongly entrepreneurial. If one considers themselves an entrepreneur, go and try to run a foreign subsidiary. This is hard work and the true essence of being responsible for running a business. It’s perhaps the most challenging profession in all of software, given the complexity and frequent changes of products. Running a subsidiary requires a person who is a breed apart.
- Service in the form of product customization is key. The most challenging aspect of running a subsidiary is recruiting and retaining programmers and other professionals who can quickly customize products with the assistance of corporate. This skill alone will make or break a subsidiary.
- Above average resilience. Last, but certainly not least, the subsidiary I visited in Australia has above-average resilience. They know how to keep making progress even when they don’t necessarily have perfect information or all product releases. It takes above-average resilience to survive and grow a subsidiary.
Australian manufacturers force vendors to be trusted advisors and focus on processes first, products and features last. One can never really see this pragmatic manufacturing base being swayed by features, functions, benefits or glitz and promises. There’s such a purity about performance here that Australian manufacturers are great examples of what it means to truly sell solutions.
Louis Columbus, a CRM Buyer columnist, is a former senior analyst with AMR Research. He is the author of several books on making the most of analyst relationships, including Best Practices in Analyst Relations, which can be downloaded for free.