In North America and Western Europe, many companies have reshored call centers, support functions, and inside sales operations because the customer experience was abysmal. Operators in the offshore locations often did not understand the mentality of demanding customers and may have lacked the training and product knowledge that would have made them more effective. Offshoring savings in terms of labor costs translated into expenses when customers left or broadcast negative reviews on social media, or when managers had to commit to expensive next-day shipping or other remedies to retain a dissatisfied customer.
Reshoring manufacturers have rarely made those kinds of experiences. Most of them long ago worked out any kinks and inefficiencies in their supply chains and logistics to meet customer expectations. As long as offshore operations could be held to clearly defined product specifications and measurable quality standards, they also had a way to produce standard products within acceptable quality guidelines.
Post-reshore, the business is a more customer-focused company
For successful reshoring manufacturers, the concern is not so much about repairing what’s damaged, but about acting upon unique opportunities to build more vital, strategic customer relationships, and bring service and product improvements as well as innovation to the customer experience.
What may have been difficult to manage through offshore operations, for example, are the qualities that make customer relationships uniquely valuable and that keep them alive for many years. When an important customer voices a specific request for your complex devices or industrial equipment, your engineering teams adjust a current product. Then the new offerings need to be developed and tested through several versions before it can be manufactured in larger quantities. Your offshore operation may have been poorly placed to support this effort.
You may need to offer customers a level of real-time interaction and collaboration that tends to be painful across time zones. If it makes sense for a customer to visit your location and spend a day or longer working with your people, the reshore location will usually make things easier than they would be if a challenging, cross-continental flight would have been the customer’s first activity. Once product customizations are defined with the customer, it will further ease the process and ensure a quality production output if your product design team is at the same location as manufacturing operations.
When ERP and other applications, such as product engineering, are in the cloud, it becomes easier to set up collaborative workspaces where your customers can meet with your company’s designers to workshop new product features and engineering concepts. The results of joint innovation sessions conducted at your facilities can be documented and stored in the cloud, where they remain accessible.
Cloud foundation for creating sustained customer relationships
Standard integrations between product lifecycle management (PLM) systems and cloud ERP, commonly available for Microsoft Dynamics 365 and leading PLM solutions, maintain a feedback loop between engineering and production. Engineers and production managers can work together to enable manufacturing to deliver the outcomes customers look for, using operator skills, equipment, and facilities with the best efficiency. You can reduce innovation rhythms, taking new products to market and reaping revenue from them, faster.
If in addition, you integrate Microsoft Dynamics 365 with Office 365, you can link your customer communications to ERP processes and documents as well as PLM product versions and related discussions, in one seamless collaboration environment.
If the goals of your reshoring initiative include bringing more value, effective support, and enablement to customer relationships, you can take advantage of the CRM capabilities of Microsoft Dynamics 365, which reside on the same connected cloud platform as your manufacturing, finance, or other business activities.
The five main CRM apps in Dynamics 365 support the core areas of sales, marketing, customer service, field service, and project service automation. You can subscribe to one or several of them as your needs demand. They integrate out-of-the-box with each other and your cloud-based ERP modules, and straight-forward configurations simplify the process of fine-tuning these integrations. In the workload-based architecture of Dynamics 365, you can implement CRM at the same time as your ERP functionality, or add it later.
From maintenance to servitization, cloud ERP and CRM enable your growth
For some manufacturers, reshoring presents an opportunity to deliver and launch new services or to wrap products in form of services. They frequently start with predictive maintenance or warranty services as one promising value opportunity. Once that turns out to be rewarding and satisfactory to both company and customer, manufacturers can evolve their service offerings.
Within a full servitization model, customers no longer purchase an item, but the value of the item. For instance, they sign a contract with you for transportation, not for vehicles. They gain the use of the vehicles as part their service agreement, and ownership remains with you. So does the responsibility for maintaining uptimes, performance, and service levels of whatever product you deliver as a service. You generate recurring revenue instead of the peaks and pauses of high-expense items, and can bind customers more closely to your organization.
Servitization and its financial and operational impacts need to be planned carefully. With the analytics you can access on the Azure cloud platform, together with the CRM and ERP functionality of Microsoft Dynamics 365, you have the resources you need to plan your resources, production, facilities, and supply chain to make valuable services competitive and profitable.
Sikich manufacturing and technology expertise can help you perform a successful reshoring initiative and increase the competitive standing and long-term viability of your business. Get started today.