Using data to drive sales

As the Industrial Internet of Things (IIoT) becomes ubiquitous, manufacturers still need to drive business and process improvement, but will now compete on their use of connectivity to enable individualised service. Manufacturers’ Monthly speaks with Kyle Hanagarne, executive vice president of Simplus Australia.

The last wave of technological transformation to hit the manufacturing industry was driven by the ability to mass produce at scale.

“Manufacturers realised technology would bring efficiency to their internal operations,” said Kyle Hanagarne, executive vice president of Simplus Australia. “They would build a system to keep track of their production, administration or finances, streamlining those processes to enable scale.”

And while those systems, usually proprietary programs individually aligned with a company’s production processes, were fit-for-purpose 20 years ago, manufacturers’ needs have changed.

Industry 4.0 – the age of intelligence that has brought an explosion of connectivity and AI-enabled interaction – has changed customers’ expectations of engagement with businesses. The future of manufacturing still requires production at scale, but now that must be matched with the ability to flexibly shift between individualised products and orders.

“Research conducted by Salesforce in 2019 finds that 84 per cent of customers say the experience a company provides is as important as its products and services,” said Hanagarne. “And almost two-thirds expect companies to tailor those experiences based on past interactions.”

Today, there are a number of software platforms that can give manufacturers the utility they had as well as the abilities they need to add. And because they aren’t proprietary systems, they don’t carry the risk of redundancy – of investing in the creation and maintenance of another soon-to-be-legacy system as the pace of change increases.

“There’s a lot available on the market as far as software goes that can help manufacturers get off of their legacy systems and start running their systems with more modern tools,” said Hanagarne.

Kyle Hanagarne has helped manufacturers around Australia update their software platforms.

While older platforms were able to keep track of production processes or provide manufacturers a sense of how their business was performing internally, the latest generation connects those processes while interacting with a customer base.

Simplus is a global integration partner of one of the most well- known of the new generation of platforms, cloud customer relationship management (CRM) company Salesforce. With local offices in Sydney and Melbourne, Simplus is providing a new way of connecting internal manufacturing processes to client relationship management.

“The new platforms make it easier to handle any process that you want, but the more important shift that we’re seeing is the purpose of the platform is changing. So as manufacturers upgrade their technology, they’re also going through a process of becoming
more customer-focussed, instead of internally focussed,” Hanagarne said.

“In the past, we’ve seen a lot of rigour in the optimisation of internal operations, so whatever is manufactured costs less than it did before. Whether that was investing in robotics or large factories with assembly lines, a lot of time the customer was forgotten.”

Up until now, collecting data about a manufacturer’s internal operations was key, whether that was the resources spent to produce a product, or the amount of down- time on an assembly line. While Hanagarne notes that this is important, a distinct separate set of data was going unrecorded.

“If you start getting an idea of which product lines you’re getting a spike of service requests about, when something’s breaking down, you can start understanding your products a bit more,” he explained. “You can say, ‘We started getting those calls 18 months after the product was released, we need to increase our quality of manufacturing so that they last for two-and-a-half years because that’s our guarantee’. You can start just by collecting data from business- as-usual interactions.”

Just collecting the data on its own is only step one. Understanding the data, without having to employ a data scientist to sift through terabytes of information, is where Salesforce comes in.

“Salesforce makes it really easy to capture that data and has strong analytics tools built in, so you can start gathering insights and creating actions based on all of that data,” said Hanagarne.

The next generation of manufacturing will require platforms that connect production to customers.

Simplus has worked with manufacturers in Australia to implement Salesforce for their operations, and Hanagarne sees the potential for manufacturers, in becoming more customer-centric, to set themselves apart.

“The question manufacturers should ask is, ‘How do I use my data to understand what customers need so I can acquire more customers? What is my current customer base doing and how do I cater my next product or service to them?’”

With a deep understanding of the challenges and opportunities manufacturers are facing, Simplus can advise on how a platform such as Salesforce can link production processes to sales outcomes.

“Take a configure, price, quote (CPQ) process for example,” said Hanagarne. “The sales operations in a manufacturing company are unlike any other industry, because when you manufacture something that has a lot of components, it can be very difficult to price and get a viable quote out the door.

“You might sell something very technical with lots of parts and lots of specifications. What if the sales representative doesn’t know how to quickly configure what they’re selling in a way that can be engineered by an engineering team? What if it’s custom built and everything has to be priced perfectly?

“If the sales representative doesn’t have a tool that allows them to easily navigate their options, then it might result in a slow quotation – a lost sale – or a pass-off to the engineering team that creates a very expensive machine that doesn’t fit the customer’s needs.”

Instead, by making what each member of the business does more visible at the point of interaction with a customer, or by ensuring that when an order is received an automated workflow follows that product through to completion, the customer’s needs can be met.

While this may sound simple in other industries, for precision manufacturing where individual pricing and configurations abound, having one system that communicates across a business, rather than siloed individual processes, can make all the difference.

“Salesforce is typically known as a customer relationship management (CRM) platform,” explained Hanagarne. “And a manufacturing company with 30 high-value customers might find it quite simple to keep those customers’ details in a spreadsheet. But if each of your 30 customers has its own contracted pricing for your components, and you have to manage to that granular level, that can be a very complex problem.”

Step one of solving this problem, Hanagarne outlined, is to ensure your team has the right tools.

“Then you can prioritise your greatest business needs,” said Hanagarne. “If your biggest pain point is your service area you can focus on service operations first and that can run independent of anything else that you’re doing; if you’re losing sales because of slow quotes and you’re ready for CPQ, you can do a CPQ project; if you need optimisation around order handling or logistics management you can do that.”

Implementing a single software system that covers an entire manufacturing business can set the foundations for everything else that will be enabled by Industry 4.0.

With Simplus on-side to navigate the potential of Salesforce, the process of upgrading a company’s software to a system such as Salesforce is smoothed out.

“We also offer change management services, which are really important for manufacturers especially if they haven’t had technology changes in a long time,” said Hanagarne. “If they are 20 years into a system and this is going to affect the majority of people who work in the company, it’s really important to understand those people, the jobs that they do, and how big of an impact the technology change is going to have on them.

“You can frame the new technology in a way that will help people understand how their job will change so that the investment that goes into these transformational projects isn’t wasted because nobody wants to use the new technology,” said Hanagarne.

Taking these steps ensures that the backbone of industrial transformation is in place.

“Getting to an updated platform that can scale through modular work is an important first step,” said Hanagarne.