Customer Satisfaction

Do you want to satisfy customer demand? Tips for understanding demand.

When you practice continuous improvement, the goal is to provide your customers with the highest quality, at the lowest cost, in the shortest time by eliminating waste.  You aim to provide them with the value they are looking for at the time they need it.  Understand and satisfy customer demand is not an easy task.  To understand customer demand, you need to understand the volume, the mix, and the variability.

How does the sales volume of your product change over time?  Is it seasonal?  Can you identify peaks and troughs?  For example, the sales of all kinds of outdoor sports gear have their peak during the summer, while arts and crafts increase during the winter.  Fall and winter are baking seasons, while the summer is grill season.  

How it looks like the mix of products sell?  There is a good chance that 80% of your sales are made up of 20% of your products.  Finally, you need to understand the variability of the demand.  Are those volumes steady, or do they change often?

In a perfect world, you would be able to produce what they need; at the time they need it.  But the world is not perfect, and most probably, you respond to volume, mix, and variation by overproducing and creating inventory.  Both things are waste in the continuous improvement world.

To respond to all these changes without over-producing, you need to be flexible.  Design the work area to allow for changes.  Consider the use of worktables and equipment on wheels that you can move when you need to change the configuration or layout.  Team flexibility is critical to react to changes in demand or mix.  Make sure that cross-training and people’s development never stop.    

Another critical piece is to schedule your product to respond to those changes without the ups and downs of demand.  You do that by using production leveling.  Using the volume, mix, and variability information, you can classify your products this way.

  1. Runners – Top sellers, orders with high volume and high frequency with little to no variability.
  2. Repeaters which are moderate volume and order frequency.  Their variability is moderate too.
  3. Cats and dogs or strangers which are low volume and frequency with high variability.

After you classify your products within one of these categories, you are ready to design your leveled schedule.  Your goal is to set up a series of workstations that build products as per demand.  You can have dedicated lines for your runners while grouping similar repeaters with similar ingredients or materials in the same work area or lines.  Cats and dogs are so infrequent that you should consider making them to order.

Use your data to understand your customers, they customers or their buying habits give you the answer you need to improve your processes.  Knowing all the details about demand will help to satisfy your customer demand without incurring high inventory costs and all kinds of waste caused by overproduction, which is the worst of the 7 wastes.

Customer Satisfaction

Do you know what is the best thing you can do to achieve Customer Satisfaction?

If you have a business, then you know how important it is to know how much the customers like your service or product. They are the best source for learning about improvement opportunities, their ideas tell you what needs to be improved, and sometimes they even suggest solutions. You need to listen to the Voice of the Customer, if you and your team understand this, you won half of the battle, already.

I remember a situation years ago when one of our most important clients was complaining about a recurring problem. The plant was consistently delivering late, causing them problems with their customers. The root cause analysis pointed to the packaging department, where the team was encouraged to have larger runs. Their goal was to avoid changing products to minimize downtime.

In a different case, the warehouse team was ignoring the 360º inspection before shipping to save time. The customer was receiving products with defects. They wanted to achieve the goal of two hours trucks turn around. The problem with these two examples is that neither of those team leaders understood the relationship between what they do and customer satisfaction.

As a business owner, you need to ensure that your business strategy and goals are aligned. Your team must know the priorities. Encourage asking questions when they have doubts. Talked with them about customer expectations and how their work affects them.

The best thing you can do to achieve your customer satisfaction goals is to accept that your team is first. It has to be a priority for you to train and develop your people. Provide them with the tools and information they need to do their job and opportunities to learn more and grow. If the team feels appreciated, they will be your secret weapon to achieve success. When you take care of your team, they take care of the customers.

CI 101, Customer Satisfaction

What are your business goals?

One of your goals as a successful business owner is to deliver high-quality products to the customer at the lowest cost. The goal of lean or continuous improvement is to provide the customer with the highest quality, at the lowest cost, in a shorter time. It sounds to me that both goals are the same, what do you think?  

Continuous improvement achieves the goal by continuously eliminating waste, and you need to learn what it is and eliminate it. Waste is any activity that the customer is not willing to pay. They don’t have problems paying for activities that transform materials into finished goods or processed information. We call those activities value-added.  

The customer does not pay for the cost of fixing errors, waiting time, or excess inventory. These activities are non-value-added or waste, and the target of continuous improvement is to eliminate them.

Waste has seven categories: transportation, inventory, motion, waiting, over-production, over-processing, and defects. There is another category added later, which is underutilization of people’s talents.

  • Transportation is an essential part of operations, but it does not act any value from the customer perspective. The goal of CI is to minimize transportation to the minimum necessary.
  • Inventory of raw materials is also a necessary evil, but you do not want to have excess inventory. Excess inventory is at risk of being damaged or become obsolete.  
  • Any motion of a person’s body that is not related to adding value is waste. Poor ergonomic designs make people move their bodies more than necessary causing safety and productivity issues. 
  • Waiting for materials, for approvals, for a phone call, or for shared equipment to become available are all examples of waste.  
  • Over-production is when we make too much because we are producing ahead of the real demand. Over-production creates more waste in the form of inventory, motion, waiting, and others.
  • Over-processing is doing more than what the customer requires. A common example of this is when you receive items in a box that is three times the appropriate size.
  • defect is when we make a mistake, or produce defective items. Fix defective products comprise time, material, and other resources.  
  • Underutilization of people’s talents is not letting people work at their full capacity. Examples of this are lack of training, not trusting in their capacity to improve processes and siloed thinking.

You can highlight the waste on the process while drawing your process map. Make sure that you eliminate or minimize waste while designing the new process. Your strategy to increase profitability is to eliminate waste.

What are your business goals? Is one of them to deliver a high quality product at a low cost? Are you targeting to increase your business profitability? Do you want to grow your business? If you answer yes to any of the last three questions, then continuous improvement is the business strategy you are looking for. Contact me, and we will work together to improve your business processes from the customer perspective.