LQ: How do you structure your operation’s supply chain in order to deliver the flexibility your customers need? E.g. Equipment availability, driver scheduling, intermodal coordination. (Kurt Ritcey)
Keith Matthews: Some companies may not be focusing their sales efforts on their most profitable areas. Instead, they may be placing a priority on investing and developing a market for future profits. In this case, cost and immediate ROI are not as important criteria for the business. In any case, you should be able to readily identify what your transportation and supply chain costs to develop a better business and have a clear understanding of the client’s criteria and benchmarks for success, and customize our service based on these factors.
For example, our company works with a mid-size client in the beverage business. They work with outside bottlers that also supply bottles to large and mid-sized companies. Typically, this client maintains a few days of inventory of bottles to produce several lines of their soft-drink product. They don’t want a large inventory of bottles and labels. The objective is to have their supplier deliver bottles as they’re required for production. On the other hand, they do not want to diminish their production if these bottles are unavailable.
After all, if this they do not have bottles requisite for their production it often means they must produce their product at another location in Canada and ship it the country from another of their other bottling inventory locations in order to meet demand. On a truckload of beverage it is a profitable business. However, in this circumstance, where the company moves a truckload of product from Vancouver to Toronto to distribute this to the Northeast United States, it hurts the bottom-line. This may have happened because the delivery of glass bottles from Indiana or another location wasn’t properly coordinated. This example highlights the value of flexibility and resiliency in the supply chain. Every level of manufacturing, irrespective of whether it’s a highly sophisticated Fortune 500 company or a small firm, should have a full mix of visibility requirements met and a reaction protocol prescribed in order to cover all the bases. Looking at all of the elements in the supply chain enables you to incorporate flexibility and resiliency.
LQ: What are the characteristics of your most successful customer relationships - successful as defined by both your customer and your business? (Kurt Ritcey)
Keith Matthews: There are several primary elements at the heart of our most successful customer relationships. The key ingredient for success is a willingness on the part of the customer to be open and share information to enable us to provide a solution that is effective. Trust and respect – and their acceptance of a third party provider – these are very important ingredients.
This is particularly important in regard to our strategic supply chain solutions, which go well beyond a sales-customer relationship. In these cases, our mutual success is predicated on more than a sales professional-customer relationship. Nor do we limit our business relationship in these instances exclusively to an operational relationship. Communication at multiple levels of an organization is essential in order to work out solutions and tackle concerns in the context of more complex and deeper business relationships. It’s vital that we understand the shipper’s business and we are engaged in an ongoing dialogue that addresses the customer’s evolving requirements.
Geoff Bennett: We also have definitions for different types of client relationships. For example, a Montreal-based client has recently indicated they are interested in working under the auspices of a traditional oneto-one relationship whereby one person at our company works with one person at their company to cover all their requirements.
This stands in contrast to an extended relationship, which is a one-tomany environment, with one principal at our firm communicating with many at the client firm. It’s a strategic and integrated relationship with synergies and multiple touch points. Defining the different types of available relationships helps our people know how we want our firm to interact with other organizations.
Keith Matthews: Another essential element for success is our firm’s primary contact, who interacts with the client’s primary contact. They must have a comprehensive understanding of the business and be very consultative in sales. They aren’t a finance professional, but they must understand the fundamentals of best practices in payment and invoicing processes, as well as be well informed on the complexities of the IT interface, for example. In summary, they must possess a generalist’s skill set.
In strategic business relationships we may also have a person working at the client’s organization in order to better understand and serve a client’s business. However, it’s very important that this knowledge isn’t lost in the translation back to our organization. This information must be effectively distributed amongst all of the people who are assigned to the solutions providing team who need to be involved in decisions to contribute to the client’s business.
Geoff Bennett: I would like to emphasize, this is how you develop a great team. We focus on having the right mix of people functioning in this kind of a team environment.
LQ: How do you hire and retain the best people?
Keith Matthews: When you’re looking for seasoned people you must be very diligent in assessing their competencies in all of the required areas. Generally, we work with other companies to hire senior-level people from outside.
Internally, however, our firm tests for aptitude, and we evaluate skill-set orientation in various roles to help assess candidates for position and develop a predictor that shows whether this person fits the profile we’ve developed. We have established a high success rate using this process. A candidate may have a proven track record that suggests a higher likelihood of success, but we are reluctant, particularly in regard to sales people, to hire sales people professionals who have done the circuit.
LQ: Gentlemen, thank you for sharing your insights on creating resiliency, flexibility and successful business relationships and sustainable business advantages for your customers. *This is the second part of a two-part series of articles; the first part of this Executive Interview was published in the previous edition of LQ. Members of LQ’s Board have developed questions for this interview.
*This is the second part of a two-part series of articles; the first part of this Executive Interview was published in the previous edition of LQ. Members of LQ’s Board have developed questions for this interview.