How can I make my projects work more effectively?
Answer: It has been suggested by an experienced project manager that alignment could save in the region of 10% on the cost of a construction project. This is likely to apply throughout all industries. Tim Ambler in 'Marketing and the Bottom Line' says boards are happily reviewing historic financial performance data, but failing to review lead indicators to do with customer preferences. For example only two thirds of companies measure customer satisfaction - and, worse, only one third report on it to the board.
Often in B2B markets, suppliers towards the end of the supply chain, like the product manufacturer, may have little idea of the end-users needs. Sir John Egan mentioned this problem in 1998 in 'Rethinking Construction'. Companies tend not to think about the customer (either the client or the consumer), but more about the next employer in the contractual chain. So many supplier-customer relationships are smugly content, while the eventual end-users may be quite dissatisfied with the overall performance of the goods and services that they receive.
Alignment has the potential to:
- reduce costs in the supply chain through increasing business excellence to the standard of the best
- improve customer relationships through managing improvements of every parties understanding of the ultimate customer's expectations
- help suppliers win new business by showing customers that they are professional and innovative
- help prevent suppliers lower down the supply chain damaging the reputation of their customers by aligning them all to the ultimate customer's needs
- and with benchmarking among peer groups, enable suppliers to retain customers by being better than their competitors
Market research among Leading Edge Management Consultancy B2B clients re-emphasises time and again that end-users just want 'solutions' and also think that they are buying 'certainty' with them. Reflecting their needs through the supply chain is 'demand chain management'.
The Business Excellence Model and the new quality standard ISO 9000:2000 requires that customer needs are fully understood and that it is the job of top management to make sure it happens. There are two implications. Firstly, new ways are needed to help all parties in the supply chain to understand the ultimate end-users expectations and secondly that there has to be a better way of measuring the degree of alignment in the supply chain.
Leading Edge Management Consultancy has developed KPI-online as a customer alignment tool. This is a flexible web-based means for all supply chain members to evaluate their expectations and perceptions of each other's performances, starting top down from the ultimate client.
This enables all parts of the supply chain to understand one another's needs better as well as how good they are at meeting them. Better performances from all members of the supply chain means that the project will run more efficiently.
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