We all probably (hopefully) feel pretty confident in our products, but how many companies are so confident they’re willing to put their money where their mouth is?

Domino’s Pizza, in the midst of revitalizing their image, has taken an unprecedented step: posting real-time, uncensored user reviews on an electronic billboard in Time Square.

Think about that for a second – real, uncensored user reviews, good or bad, instantly in the middle of Time Square for all of New York to see. How many of you would be so confident in your product?

The idea and campaign for Domino’s is said to draw its inspiration from the famous book The Art of War where the author writes that the best way to win a war on an island is to blow up the bridge. In doing so death or victory are the only two options. It’s an extreme reference for pizza, but you get the idea – by making yourself so transparent you show that you’re standing behind your product. You’ve got nothing to hide. You’ll show the world that people either love it or hate it.

The Times Square billboard strategy (which runs for about 3 hours a day and will show about 700 reviews on any given day) hits the mark for both transparency and social media. It also really goes above and beyond in the step of measuring customer satisfaction. Hats off to Domino’s for putting themselves out there on an island, so to speak.

Read the full article at Fast Company.

You can actually get The Art of War for free on your Amazon Kindle or Kindle App for your other smart phones.

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In this series of interviews with senior managers, I explore how the supply chain affects total cost of ownership of packaging technology.

Allpax started life as an engineering organization that outsourced its manufacturing. Managers found that outsourcing manufacture of their equipment did not achieve the level of quality and delivery they set themselves. They brought manufacturing in-house, where it remains to this day. Product quality, superior service, and retort room innovation, including full automation, have made the company a success. I spoke with Greg Jacob, general manager of Allpax about supply chain issues and how these impact total cost of ownership.

Steve: What does an ideal supplier do for your company?

Greg: We informally segment Allpax suppliers into two categories, Tier 1 and Tier 2. Tier 1 suppliers provide great products and valued added services that lower our cost of doing business. Tier 2 suppliers provide us with quality components. Don’t get me wrong, all of our suppliers are important. But a critical few truly make a real difference to our business.

Steve: Can you give me an example of how a Tier 1 supplier lowers your cost of doing business?

Greg: We’ve worked out an arrangement with one of our suppliers to stock parts for us. This has helped decrease inventory and speed up turnaround when customers require those parts.

Another example comes from our motors and drives supplier. Our customer representative is a first-rate engineer. When we have a new project, we give him the load, speed, and other requirements and he comes back with the absolutely right sized and right priced motor and drive. He saves us engineering time and has proved time and again to be a valuable resource for us.

Steve: Are you seeing a trend to more technical support from your suppliers?

Greg: An increasing number of companies see the writing on the wall that if their customers – the U.S. based Original Equipment Manufacturers – are not successful then they won’t be. Allen-Bradley, for example, has formed an engineering group specifically focused on the needs of the machinery OEM. Leading suppliers provide technical expertise that helps specify components faster, troubleshoot problems more quickly, and free engineering and support teams for their own value adding work.

Steve: We’ve looked at what your suppliers are doing to lower Allpax’s cost of doing business. What is Allpax doing for its customers?

Greg: We recently designed a new software program that automatically alerts maintenance personnel when a particular part or system is due for preventive maintenance. It’s almost like an operator-interface-based digital assistant. Compare that interactive approach to a stack of maintenance manuals lying idle in someone’s office. There is no comparison.

Furthermore, Maintainer software offers a host of other features. Through a free viewer that we can download onto that operator interface, we deliver 3D modeling software. The maintenance person has at his or her fingertips graphic information on how to change and/or service a component. Let’s say a bearing housing that is up for service is located three levels below other components. The software allows the maintenance person to open up a 3D model of this component. The software can hide parts, graphically spin parts around, and provide an isometric view in color of what the maintenance person needs to work on. This can be a quite a time saver. When we give a presentation on this feature, you can see the maintenance manager’s eyes light up.

Steve: Any other new developments that highlight making the customer more productive?

Greg: Two more come to mind. Our Challenger software module is one. When the retort is put into “Challenge Mode” it will run a series of tests on critical control parameters. After the retort is “Challenged” a deviation report displays a full account of any issues. Imagine the costs in time, energy, product waste, and potential for liability when sterilization processes become unsynchronized. And here is an automated process that documents where you are in maintaining critical specifications.

Secondly, when customers request it, we have the means through virtual private networks to remotely and securely log onto the customer’s equipment modules and monitor performance. In effect we are virtually in the retort room to assist in trouble shooting or fine tuning a process in real time. The customer receives near instant support and does not have to wait for a technician to be dispatched. Customers with a number of plants can use the virtual private network capability to log onto their own remote sites and have real time information on production and operating parameters.

Studies show that the largest cost of owning a piece of equipment comes after it is installed. Each of these developments addresses that reality. The work that we are putting into these applications ensures that the overhead for maintenance and operation are minimized while quality production is maximized. And if we want to retain customers, and we do, then we had better be sure to offer them ways of lowering those maintenance and operations costs.

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In Part 1 of my interview with Ernie Newell, vice president and general manager of Ossid, a division of Pro Mach, Ernie discussed how relationships with supply chain partners help packaging machine OEMs lower the overall lifecycle cost of a machine.

In Part 2 of this interview, Ernie and I discuss how packaging machine OEMs can work directly with customers to ensure lowest overall maintenance and operating costs. These two interviews in effect provide a 360 degree view of lowest total cost of ownership, both inputs and outputs, from the packaging machine OEM.

Steve: After a sale what can the OEM do to ensure lowest total cost of ownership?

Ernie: Training, spare parts, staying close to the machine and the customer, and product performance feedback from customers are all essential in the lifecycle cost mix.

Steve: You were telling me that Ossid does not make training a profit center.

Ernie: In terms of uptime and throughput of a new machine, the single most important thing we can help our customers with is training. Ossid makes training as easy and low cost as possible for our customers. We encourage every customer to send operators and maintenance personnel to our plant prior to the machine being installed. This means they focus on the machine. The training at our facility by our PMMI certified trainers is free with new machine purchases – the customer is responsible for travel expenses. Once the machine is installed and for older machines, we provide training at a low price which is simply aimed at covering associated costs. We recommend that training be ongoing, and we like to tie that in with regular maintenance visits.

Steve: How does the cost of replacement parts factor into lowest total cost of ownership?

Ernie: OEMs would rather have customers buy replacement parts from the factory. Some of this is profit center thinking. We recommend factory authorized parts because those parts last longer and don’t require nearly as much maintenance. To make factory parts more affordable, we offer stocking agreements that include regular machine inspections and tune ups along with the parts the customer receives. We are currently evaluating a two tiered parts program of lower cost and higher cost parts, recognizing that customers have different needs and situations. I’d rather have our customers come to us, and the expertise we can offer, rather than having them go out and find the cheapest part and eventually pay a lot more in repairs and upgrades.

Steve: Are the reports of field technicians factored back into design and development?

Ernie: Our field technicians bring in a constant stream of good ideas and observations that inform product direction. For example, we just launched a low cost add on to our overwrappers that can save an average of 375,000 gallons of water per year per machine. This innovation comes directly from customer feedback and the observations of our field technical teams. Feedback is particularly helpful on operator/machine interaction. Operators know what helps them and what they would like to see that would help them even more.

One of our big undertakings right now is a new horizontal form fill and seal line. We’re coming out with a solution that will lower the customer’s overall cost of ownership – from the initial purchase price to the efficiency and longevity of the machine. We will do this by simplifying the machine from a mechanical standpoint, doing away with unnecessary moving parts, eliminating parts, making it just as simple, clean, and efficient as we possibly can. And that comes from years of experience from our staff and from customer feedback. Customers were very involved with this program from well before prototype.

Steve: Are there any other programs you are working on that contribute to lowering maintenance and operating costs?

Ernie: For one of our customers, we are mentoring/advising maintenance and operation personnel as they refurbish several of our machines during the annual plant shutdown. The idea is that people learn best by doing. So we are advising and pitching in where necessary. From this particular customer, we’ve gotten feedback that our approach to regular maintenance and training has reduced downtime and generated greater efficiencies.

Steve: Do you feel that after sales service prolongs customer relationships?

Ernie: I definitely believe that our business is totally about customer relationships. We have a significant number of customers who’ve been with us since the start of Ossid. For example, we support machines that are more than 20 years old. We’d like to sell these customers new machines, but that’s not the point. The point is to strive to keep the machines running, the operators trained, and maintenance and operational costs low. Everything else follows from the emphasis on these things.

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With much of the attention focused on developing high-performance, price competitive packaging machines, what are machinery OEMs doing to lower the maintenance and operating costs of their equipment after the sale? This is the first in a new series of interviews with OEM general managers on striving for lowest total cost of ownership for their customers. For this first interview, I spoke with Ernie Newell, vice president and general manager of Ossid, a division of Pro Mach.

Steve: Every packaging machine contains components manufactured by outside suppliers. Is there a type of components suppliers you look for in terms of partnerships?

Ernie: One of the things we look for is a wide product portfolio. This means we can take a number of components and know that they have been designed to work together. This approach lowers our engineering costs and also our customers’ long term costs. Another thing we look for in our top components suppliers is the ability to support us in the field.

Steve: Sometimes your suppliers may be out in the field with your service personnel?

Ernie: We want the best and fastest possible solution for any problems and occasionally that means bringing our partners into a field service situation. The end users, our customers, appreciate that when they have an issue, we bring in the necessary expertise, whether on occasion it is both our service personnel and a partners technician. It’s not all the time, but it is another resource available to us. Those are the partners we want to have.

Steve: Do component suppliers provide engineering assistance during the design phase of a new machine?

Ernie: We like to do business with suppliers who can sit down with us during the engineering/design phase of a new machine. We discuss product specifications, and we ask our suppliers to give us component options that compete in price and perform to long-term operating goals. We want our top suppliers to provide world-class engineering expertise.

Steve: We were speaking before this interview about the speed of change in the electronics industry and component obsolescence.

Ernie: It’s far more expensive to replace an obsolete part than one that is still current. Our key suppliers work with us to identify components they expect to remain current for an extended amount of time and to steer us away from others with shorter life cycles. Sometimes that means we specify a slightly more expensive component, but in the long run it is the smart purchase in terms of lowest total cost of ownership for our customers. We work with suppliers on component migration strategies, which puts a plan in place to cost effectively upgrade machines before components become obsolete. In effect, the base machine stays current and maintenance and operating costs are kept to a minimum.

In Part 2 of this interview, Ernie will talk about additional proactive approaches to lowering maintenance and operating costs…

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They say that to succeed companies must chose what their value proposition will be. Is it to be the low cost leader? The customer service leader? Have the widest selection? Once you pick your value proposition it dictates all your future strategies, tactics, behaviors, etc. One company that excelled at this was Nordstrom. For many years new employees were given the New Employee Handbook that was merely a 5″ x 8″ gray card with 75 words that read:

Welcome to Nordstrom

We’re glad to have you with our Company. Our number one goal is to provide outstanding customer service. Set both your personal and professional goals high. We have great confidence in your ability to achieve them.

Nordstrom Rules: Rule #1: Use best judgment in all situations. There will be no additional rules.

Please feel free to ask your department manager, store manager, or division general manager any question at any time.

One rule: Use your best judgment in all situations. I’ve said it before and I’ll say it again – if you’re going to excel at customer service you have to empower your employees to let them make decisions without getting caught up in bureaucracy. Get the right people in place and get out of their way. That’s how you deliver exceptional customer service. (Blog idea via 37signals).

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At Pack Expo International 2010 in Chicago, IL, we hosted a ProCustomer Cocktail Party where we invited our key customers and partners to relax and unwind with us as a thank you for working with us.

At the party we were excited to announce our first ever ProCustomer Champions for excellence in customer service. We had 12 nominees from our divisions and in the end we chose 3 champions – one representing each Pro Mach business unit (Primary Packaging, End of Line Packaging and Identification & Tracking). Each champion was given a plaque and a nice award as our way of saying thank you for going above and beyond in their jobs. Our individual champions were:

Identification & Tracking Business Unit:
Mike Knecht, ID Technology

Mike Knecht is the Senior Service Technician for ID Technology in the Ohio Valley region and handles the entire product line of labeling, coding and marking. He’s been with the company for more than five years. His attitude is what makes him unique. Mike epitomizes the ProCustomer experience, taking reactive, interactive, and proactive to the next level of excellence. Our top customers ask for him by name.

End-of-Line Business Unit:
John Hodge, Brenton

John Hodge is the Service Advisor for Brenton and handles the full range of everything that comes out of Alexandria, MN including Orion stretch wrappers, Brenton case packers and Currie palletizers. He’s a Master Technician for FANUC. He will go the extra mile in assuring the customer’s expectations are always exceeded. John is looked upon by everyone as a huge contributor in maintaining a culture that takes pride in providing exceptional customer service. He just has a different attitude.

Primary Packaging Business Unit:
David Roberts, Fowler Products

David Roberts is the Conversions and Retrofits Specialist for Fowler Products and has been with Fowler for 35 years. David has delivered strong and consistent leadership and day-to-day effort in a record-setting year for Aftermarket Services at Fowler. He takes the extra effort and goes the extra mile, as a rule. David’s selfless efforts have enabled him to build a solid, trustworthy reputation where customers are coming back to him and asking for his guidance.

ProCustomer Champions 2010 - Left to Right - Mike Knecht, ID Technology; John Hodge, Brenton; David Roberts, Fowler Products; Mark Anderson, Pro Mach CEO

Congratulations to our ProCustomer Champions and thank you to everyone who was able to come to our ProCustomer party to see them honored.

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Pack Expo International 2010 starts this Sunday, October 31 and runs through Wednesday, November 3 in Chicago at McCormick Place. Pro Mach and its brands will have a 12,000 square foot island in the South Hall where we’ll be showcasing all our solutions for the packaging industry.

Also at Pack Expo we’ll be offering a first – the ProCustomer Smart Bar (booth S-956) – a place for you to come and ask us anything about packaging machinery. With our experts on staff we can help you with whatever need you have. We’ll also be doing brief educational presentations – the full schedule is below. If you’ll be at the show please come by and see us.

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Sunday, October 31

11:00 AM – New Extended Text Labels for Shrink Sleeves
Tony Camerota and Craig Clark, C-P Flexible Packaging

Learn about a new product to address the growing demand for added label space and package reduction. New shrink label technology can add 100% more space without changing application equipment or containers.

Monday, November 1

10:00 AM – Direct Drive Technology
Tom England, Kollmorgen

How direct drive technology can help you solve your toughest throughput challenges, clean up your machine, and not break the bank.

11:00 AM – New Extended Text Labels for Shrink Sleeves
Tony Camerota and Craig Clark, C-P Flexible Packaging

Learn about a new product to address the growing demand for added label space and package reduction. New shrink label technology can add 100% more space without changing application equipment or containers.

1:00 PM – ProCustomer Remote Support Services
Tom Peshek, Rockwell Automation

Delivering superior customer care remotely takes a well thought out plan and solid infrastructure. We will explore the how and why of the structures that provide users with cost effective support.

2:00 PM – Making a Case for Manufacturing Intelligence
LJ Elrod, Axon and Dan Seger, Rockwell Automation

Packaging machines can deliver more value with the adoption of industry standards, starting with PackML.

3:00 PM – An Overview of Track and Trace on the Packaging Line
Jack Roe, LSI and Kelly Tung-Steudler, Rockwell Automation

Get a full overview of Track & Trace from the viewpoint of the packaging line with a focus on marking and data gathering technologies, aggregation and Manufacturing Execution System (MES) functionality.

4:00 PM – Use of Robotic Technology Across the World
Mike Grinager, Brenton

Learn about international robotic packaging applications as well as robotic pick-and-place technology.

Tuesday, November 2

10:00 AM – Servo Drive Technology
George Ellis, Kollmorgen

Get the most throughput, accuracy and OEE out of your servo driven machine with tight servo loops and high speed registration.

11:00 AM – New Extended Text Labels for Shrink Sleeves
Tony Camerota and Craig Clark, C-P Flexible Packaging

Learn about a new product to address the growing demand for added label space and package reduction. New shrink label technology can add 100% more space without changing application equipment or containers.

1:00 PM – ProCustomer Remote Support Services
Tom Peshek, Rockwell Automation

Delivering superior customer care remotely takes a well thought out plan and solid infrastructure. We will explore the how and why of the structures that provide users with cost effective support.

2:00 PM – Making a Case for Manufacturing Intelligence
LJ Elrod, Axon and Dan Seger, Rockwell Automation

Packaging machines can deliver more value with the adoption of industry standards, starting with PackML.

3:00 PM – An Overview of Track and Trace on the Packaging Line
Jack Roe, LSI and Kelly Tung-Steudler, Rockwell Automation

Get a full overview of Track & Trace from the viewpoint of the packaging line with a focus on marking and data gathering technologies, aggregation and Manufacturing Execution System (MES) functionality.

4:00 PM – Use of Robotic Technology Across the World
Mike Grinager, Brenton

Learn about international robotic packaging applications as well as robotic pick-and-place technology.

Wednesday, November 3

10:00 AM – Stepper Drive Technology
Bob White, Kollmorgen

What performance to expect from stepper driven machines.

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We hope to see you in Chicago. If you have any questions please contact us. For more information on Pack Expo visit PackExpo.com.

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There’s a really thought-provoking post over at the NY Times blog that offers some insights into customer service from Jay Goltz, a small business owner in Chicago. In How to S.A.V.E. Customer Service, he discusses the elements of a great customer service rep:

• 20% – Being friendly
• 40% – Knowing the products/services
• 40% – Knowing how to take care of angry customers

That last 40% is what he really expounds on and shares a nice acronym on how to SAVE an angry customer:

• S – Sympathize - Let them know they’ve been heard and that you see why they’re unhappy
• A – Act - Tell them what you’re going to do to fix it
• V – Vindicate - Assure them this is not business as usual
• E – Eat Something - Do something to make it up to them

Following the SAVE methodology can go a long way. Read the full article to get more in-depth examples on how save customer service both inside and outside your company. Do you have an acronym or some other helpful script you have internally to help keep your customer service reps on task when dealing with an angry customer? Feel free to share in the comments below.

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Food Engineering magazine just published their 8th Annual Replacement Parts Directory in their August 2010 issue and in it they included a Replacement Parts & Components Survey of food and beverage professionals that has some very good information in it.

Two of the charts stood out to me and offered some really great customer-centric insight into the parts and maintenance process.

The first asks “Who Makes Most Replacement Calls?” The results aren’t too surprising:

• Maintenance – 53%
• Plant Operations – 14%
• Engineering – 12%
• Administration/Executive – 10%
• All Others – 11%

Though the results aren’t shocking I think there’s value in really knowing that people from these various roles will be calling you. Put yourself in their shoes and you realize the challenges one group faces day-to-day may be drastically different from another group (say maintenance staff versus engineering). You may be able to adjust your service approach in slightly different ways depending on the role of who’s calling.

The second question asks about “Favored Strategies for Maintenance” and here’s where the results get interesting:

• Visual Inspections – 43%
• Fix When Broken – 22%
• Time-Based Replacement – 12%
• Predictive Tools – 11%
• Automatic Monitoring – 6%
• Volume-Based Replacement – 6%

There are a lot of ways to interpret this data. Perhaps you think predictive maintenance or automatic monitoring systems are something you could put in place to make your company more cutting edge. The survey results though show that only 17% of customers favor this. There’s two contrasting deductions you could make with this info – it may be that a lot of customers don’t have systems in place that do this and that’s why they don’t favor these strategies (because they don’t know about them). But it could also be that some customers, even with these types of systems, will continue to rely on the traditional methods of eyeballing it and calling you only when it breaks (because they don’t care about them).

Either way it goes to show that while there is some definite room for growth in those areas, perhaps just offering it alone on your systems isn’t enough. Maybe you need to combine that with some training and education sessions with your customers to get them to fully understand the benefits of it. We have a tendency to assume that our customers will just know about and want the cutting edge stuff, but it’s up to us to make sure they know why it’s a good thing. We didn’t know we needed iPods until Apple told us we did, and the same may be true for things like this. Remote diagnostics, PackML, and all sorts of other bells and whistles may be intuitively no-brainers for us (the machine manufacturers), but until you make a compelling case to the customer for it, it will always fall into the realm of “nice-to-have, not must-have.”

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I’m not talking about babies here, I’m talking about customers. The easiest way to create happy customers? Do what you say you’re going to do.

There’s a catch though – a lot of us don’t say what we’re going to do. That step – settings the expectation level – is what we’re missing.

Repeat after me: set the expectation early, then deliver on it. You don’t even have to overdeliver, just do what you said you would do, when you said you would do it. You’ll find the results are amazing. Astonishing even. You know what’s better than that? Set the expectation quantitatively. Can you respond in 4 hours? Say you’ll respond in 4 hours. This creates an even better experience than saying “We’ll respond ASAP.” It lets the customer know exactly what to expect.

Seth Godin, author of numerous books on marketing, customer service and general business, addressed this in a post called “Spare No Expense” on his web site. He breaks it down this way:

“It’s about balancing between serving a lot of people a little, or dropping everything to serve a few people a lot.”

He goes on to say we can get trapped by the extreme end of that – the “spare no expense” mantra. He does offer a solution though:

“The way around it, I think, is to set expectations early and often. If you’re going to give me your phone number, you better answer it. If you’re going to offer a warranty, you better honor it.”

The key is settings the expectations. Focus on this and you’ll find most of your customer service issues will magically go away. Of course I say that with the implication that you also follow up on it. That’s pretty important too. What you’ll find though is the follow up is that much sweeter for the end customer when the expectation was set versus when it wasn’t. Crazy how that works, but it works.

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