How Small Business Can Benefit By Acting “Big”

As a General Motors Supply Chain leader for over 25 years and now a small business owner, my experience has proven that successful operating fundamentals are the same, no matter the size of the company.  For both General Motors and Classic Auto LLC, this means optimizing data, capacity, and processes in order to find, satisfy, and keep customers. These core concepts are well-established in the corporate world but often discounted by small business owners. Here’s what I’ve learned. 

Three Keys To Unlock Long-term Success…For a Business of Any Size 

1. DATA – Key for finding customers. According to Gartner, Inc, “By 2025, 75 percent of B2B sales organizations will augment traditional playbooks with artificial intelligence (AI) guided selling solutions.” And “Selling with data leads to more wins in a shorter amount of time.” This supports the need for leveraging technology, not just for gathering, but more importantly, for intelligently using and acting on data.
   It’s easy to get overwhelmed with the vast amount of information available. Start with the basics by researching the data and analysis needs specific to your industry/products/services. And this does not have to mean a big investment. Many free or low-cost resources are available vs reinventing the wheel, doing it manually, or worse, going without. “Sellers can no longer exclusively rely on intuition-based selling to push a deal over the finish line,” said Steve Rietberg, senior director analyst in the Gartner Sales practice.
   GM Example: Advanced forecasting and analytics for using demand data were critical to effectively manage parts inventories (depth, breadth, and location) across the global aftersales network. The result? With millions of GM vehicles on the roads, data and technology investments were crucial for supporting a strong focus on the customer experience while minimizing the cost of doing business. What’s next? Continued investments in data quality and supply chain planning technology to further advance that customer/cost balance.
   Classic Auto Example: The chip shortage has created a very dynamic vehicle market, driving up used vehicle prices…for customers AND dealers.  We quickly learned the value of facts vs instinct. Accessing CARFAX information and analyzing recent sales at dealer auctions and on Facebook provides the details needed to buy trending vehicles at the right price point to ensure a profit opportunity. The result? Investment in this data-focused approach more than paid for itself the first month in operation.
2. CAPACITY – Key for satisfying customers. Capacity is the supply chain equivalent to “Location Location Location” in real estate. Without enough of it, supply chain disruptions occur…experienced by virtually every business/industry during the COVID pandemic. Since it is common for volumes to fluctuate frequently in most industries, regardless of COVID, it is extremely important to establish regular capacity evaluations for all key processes across the end-to-end supply chain.
   According to the Association for Supply Chain Management (ASCM), “Having capacity just right moves the organization away from reactive and toward proactive – in other words, from an emergency mentality to a graceful flow of logistics.”  Start-ups in particular should identify capacity limits as early in their launch cycle as possible. Then proactively adjust (up or down) before outgrowing capabilities or unnecessarily maintaining excess capacities/costs. And be sure to look both internally and externally…you can only be as successful as your suppliers enable you to be.GM Example: In-house packaging is an added step required for most aftersales parts before shipping to customers.  By acting on output from regular capacity planning reviews, an investment in a larger, more automated packaging facility enabled a significant capacity increase. The result? The added throughput supported double-digit sales growth that came to fruition just as the facility was completed.
   Classic Auto Example:  As a family-owned/operated business, we quickly learned the importance of sales and marketing activities for building our brand and our business. Timely posting of inventory, following up on leads, and scheduling test drives all have significant company reputation and revenue generation implications. The result? Staffing with the right amount of Sales & Marketing resources has been the primary factor in staying top of customer leads and expectations, and quickly turning our inventory at a profit.
3. PROCESS – Key for keeping customers. As Dr. W. Edwards Deming, American statistician and Total Quality Management thinker, stated, “If you can’t describe what you are doing as a process, you don’t know what you’re doing.” Consistently delivering a seamless experience from the first customer touchpoint to the last requires well-defined processes and ongoing monitoring. And THAT requires the application of continuous improvement tools like the Plan, Do, Check, Act (PDCA) cycle and Lean Layered Process Audits (LPAs).
   Successful firms use these types of methodologies to establish and then improve Standard Operating Procedures (SOP’s). With each iteration, they train employees to ensure flawless execution every time, minimizing non-value added activities and consistently delivering on customer expectations.
   GM Example: Standardized work and SOP’s have been in place across all Parts Distribution Centers for 20+ years, enabling highly competitive quality and best in class efficiency according to Carlisle Parts Benchmarking results. This same approach was more recently adopted in Sales & Marketing through standardized opportunity reporting and templated customer interactions. The result? A significant factor in achieving the earlier referenced double-digit revenue increases…AND a positive internal synergy between Sales and Operations.
   Classic Auto Example: By refining our core processes to do the basics “brilliantly”, our dealership addresses the biggest used vehicle customer pain points, e.g., timely communications, a fast closing, and a customized but structured test drive process. The result? Several individuals and businesses are already repeat-customers choosing Classic Auto as their primary source for vehicles…AND generating referral business simply by spreading the word.

Take Aways: Whether a small business or a large corporation, the same operating fundamentals apply. Put customers at the center of everything you do…with DATA as a key for finding customers, CAPACITY as a key for satisfying customers, and PROCESS as a key for keeping customers…all while optimizing costs. Any business or organization can benefit from this approach, increasing value-add for the company and your clients…a true competitive advantage and key to long-term success. 

Gartner data source: “Sales Predicts 2022: The Digital Evolution of B2B Sales.”

The Association for Supply Chain Management (ASCM) is the global pacesetter of organizational transformation, talent development and supply chain innovation. ASCM offers a wide range of credentials and certifications covering every aspect of end-to-end supply chain operations. To learn more, visit ascm.org.

Written by Lisa Veneziano.

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