Looking ahead it is very obvious that innovation (I call innovation as continuous improvement) is progressing rapidly the world over.
The reasons are many but two stand out.
One, the product to customer path has become shorter, due to the worldwide and instantaneous reach possible. This gives the innovator quick and diverse feedback, enabling him to innovate at a quicker pace than earlier.
Two, computer simulation has become sophisticated and enables innovators to test and come out with the prototypes more quickly.
A case in point is SPACE X which came out with a reusable rocket within four years of commencement of research. This rapid innovation of such a large project has not happened in the past.
So, what does this tell us?
The immediate future is about quick innovation and corporate and msme companies have to orient themselves to ride this phenomenon.
How can companies leverage this phenomenon?
The answer is in looking at what China is doing. China has approached this situation in a multi pronged manner.
Firstly, they have invested heavily in making their universities on par with the best in the world. As, experience has shown universities are crucibles of innovation.
Next, they have invested heavily in Industrie 4.0.
Industrie 4.0 is based on big data, 5G and robots. This makes Chinese companies far better equipped to serve customers.
Further on, they have identified the best innovators and made them addicted to China’s superior supply chain infrastructure.
Take, Tesla’s car battery technology. Did you know that China’s factories are now in a position to offer locally made batteries for Tesla’s electric cars to be sold in China?
Tesla cannot ignore this as the cost of battery makes up a sizeable portion of the electric car price and is being offered at a heavily discounted price.
So, what does this tell us? Simple, if do not have a position to innovate some thing, immediately get into manufacturing that part for a low price. Even going to the extent of going to the Govt. for subsidising the raw stock costs. Do everything possible to get the innovator be addicted to your supply chain capabilities.
For instance, if you are in aerospace component manufacturing you will have to plan to make your customer addicted to your supply chain capabilities.
Firstly, why will your customer become addicted to your services?
Work to build up the reasons:
- Competitive and a honest (true) quote.
- Superior technical capabilities.
- Adherence to delivery schedules. Customers are willing for a small delay also.
- Periodical progress update. A standard procedure has to be followed, which will reassure the customer that the product is being manufactured. Go for zero calls from customer till delivery, as your target.
- Offer superior packing systems. [Build the cost into the order].
- Try and return the left over material to the customer. Demonstrate your honesty. This is critical to win the customer’s confidence and more orders.
Next, build a proper network of capable contractors.
Lastly, invest in upkeep of machines. a company cannot go far in reaching the goal of supply chain addiction.
If you are finding it hard to understand the significance of supply chain addiction, think of your favourite restaurant. How many times do you think of your favourite restaurant. Become the supply chain addiction for your customer and see your company turn around for profits.