Is your Supply Chain Customer Oriented? – Engaging Customer Segmentation

Supply chain optimization is still, in many companies about logistics (purchasing, inventory). By missing the link between sales and the rest, you will fail to release huge potentials.

Yesterday, I had the opportunity to attend the defense of a doctoral thesis on customer segmentation, Customer Value Management (CVM). Morten Holm (former strategy consultant at Quartz + Co) has been working on how the shift from product- to customer orientation leads to greater complexity in the client portfolio.

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CVM provides

  1. Efficient resource allocation
  2. Greater Return on Assets
  3. Superior resistance

To reap the full benefits of customer orientation, companies
need to differentiate their resource investments according
to the profits various customers generate now and/or are
expected to generate in the future. This discipline is referred

to as Customer Value Management (CVM).

from Whitepaper, Quartz+Co

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Then, the obvious question is: Do I manage the client portfolio?

A decent starting point would be…

… to segment customers according to ‘cost-to-serve’. How expensive is it, to serve each single customer. A CVM project can be very sophisticated and comprehensive. Most importantly, to create value you should start as soon as possible. . In ABC Analyzer you can apply as simple and powerful method.

I have seen, how this has provided new surprising insights. A structured approach to the client portfolio can have positive consequences for the possibilities of optimizing the rest of the supply chain.

Supply Chain Synchronization includes Sales

Customer segmentation is necessary for supply chain optimization, but in many companies’ the supply chain function remains closely linked to the logistic function (including procurement and storage). In order to allow optimization of supply chain, maximizing the impacts, it is necessary to involve the whole supply chain including the sales department.

Exactly this trend is supported by ABC Analyzer. Analysis that provides action oriented proposals for changes in relation to the management of the client portfolio should impress any responsible leadership!

 

This should be a clear recommendation from me. Go ahead involving your colleages working with directly with the customers. If you are interested in getting started, do not hesitate to contact me at okk(a)abcsoftwork.com. We can find out if a company specific workshop or an activity via ABC Academy is the way to go.

 

Enjoy your weekend

 

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