Episode 26 Mar 11, 2021

B2B Reimagined: Ep 26 | A Manufacturing Industry Snapshot with Acumen Solutions

We welcome two guests from our strategic partner Acumen Solutions, Manufacturing Industry SME Gary Brown and Engagement Director Kyle Dreyer, to take the pulse of the modern manufacturer during a time of intensifying change.

Host Lindsay Duran leads the conversation, which covers the need for customer-centricity for B2B and B2C channels, workforce transformation, supply chain disruption, raw material cost increases and an accelerated push to eCommerce.

Listen to learn how manufacturers are responding to these hurdles amid a global pandemic and future-proofing their business for a post-pandemic environment. For more information on Acumen Solutions, visit www.acumensolutions.com or reach out to contact@acumensolutions.com.

Gary Brown

Gary Brown

Kyle Dreyer

Kyle Dreyer

Individuals who are buyers for their organization also are consumers in their personal lives. What that implies is that those individuals now have an expectation of what shopping or buying online is like, and now expect that when they're buying on behalf of their company.
- Kyle Dreyer, Acumen Solutions

Episode Transcript

Kyle Dreyer: So I think the first thing to remember, and it seems obvious, but that individuals who are buyers for their organization, also are consumers in their personal lives. So obviously in today's world, nearly everyone shops online and these experiences have insignificantly improved over the last few years.

What that implies is that those individuals that are buying at a consumer level now have an expectation of what shopping or buying online is like, and now expect that when they're buying on behalf of their company.

Lindsay Duran: Welcome to B2B Reimagined. My name is Lindsay Duran, and I'll be your host for this episode. I'm joined by two guests from Acumen Solutions, Gary Brown and Kyle Dreyer. Welcome to both of you and thank you for being here.

Why don't you both take a moment and introduce yourselves and tell us a bit more about your background, Gary, we'll start with you.

Gary Brown: Sure. Thanks Lindsay. So my name is Gary Brown. I'm with Acumen Solutions. We are a Salesforce company and I serve as a subject matter expert and industry lead for our manufacturing team.

So my role primarily is to work with our manufacturing clients and our Acumen and Salesforce geo teams to help determine the best products and solutions for manufacturers as they face challenges in their industry. I've been in the consulting space for eight years. And prior to that, I worked in various leadership roles with manufacturing companies.

So [00:02:00] I, I think I have some great expertise on both sides of the fence.

Lindsay Duran: Excellent. Thank you. And Kyle.

Kyle Dreyer: Sure. Thank you. Thanks for everyone's time today. My name is Kyle Dreyer. Also with Acumen Solutions. What I am responsible for is our commerce practice globally.

So like Gary, I support our organization and all of our different geographies in implementing digital commerce solutions for our customers, with the primary focus on B2B Commerce. And I am looking forward to discussing that with you all.

Lindsay Duran: Perfect. Thanks so much. So today we'll be talking about commercial challenges and best practices in manufacturing.

So Gary, I'd like to start the conversation with you. 2020 was certainly quite a year of substantial change and disruptions for all of us. Can you talk a little bit about some of the primary challenges that manufacturers saw over the course of the past year?

Gary Brown: Well with the pandemic that market's never been more [00:03:00] volatile and manufacturers have been challenged to flex, in meeting the ever-changing needs of their customers.

The situation has been exasperated by plant closures, program delays or cancellations and disruptions from their own suppliers. Manufacturing customers demand reliable delivery, and those who perform poorly are at risk of losing business. So I would say that's foremost, one of the challenges that we really saw rise to the top in 2020, we also saw some challenges around becoming a connected supplier.

So examples would include B2B Commerce and leveraging IOT for real time data and analytics to drive improved service and automation. Attracting and retaining talent has continued to be a challenge in the manufacturing space. A recent Intel study revealed that workers just aren't properly trained for the skills that are needed for the latest industrial technology. And then finally, I would say activating analytics across the entire business, in the manufacturing space, there's disparate legacy systems, there's tech stack integrations [00:04:00] that make it really difficult to access data and make that data actionable. So as I look at challenges and from what we're hearing from our customers, those are the ones that rise to the top.

Lindsay Duran: Certainly we saw in 2020 an acceleration in eCommerce investment. And specifically for manufacturers, they are getting to go around distributors in many cases and sell direct to clients. How are manufacturers mitigating this channel conflict? If they've historically sold through distribution?

Gary Brown: Yeah, that's a great question. And it definitely is happening. So what manufacturers are trying to do is initiate a really well-planned multi-channel strategy. And there's a couple of things that you need to look at when they do that. When you look at a direct sales model, you really need to be cognizant of how you're going to be able to service your customers.

So, some of the considerations they need to evaluate is the ability of the company to [00:05:00] service key accounts on a direct basis and meet inventory requirements. Those are areas where distributors can really add value. So that's one of the things that they really look at. They're also trying to really clearly establish pricing tiers.

They want to be sure that they keep distributors in the loop on what's going on when they make the decision to go direct. It's really important and they're mitigating it by defining boundaries and rules of engagement. It's really important as well, to look at collaboration. So in some cases, seeing manufacturers collaborate with your distribution customers on how best to service.

And then finally we've even seen distributors get compensated for direct sales when they're in protected territory. Those are some of the things that we're seeing as mitigation strategies.

Lindsay Duran: I think you make some really good points there specifically around not damaging the relationship with the distributors as they are a key fulfillment partner for the majority of manufacturers, especially in those long tail of accounts.

How are [00:06:00] you seeing pricing decisions impacted by this shift to eCommerce or the disintermediation of distributor relationships?

Gary Brown: One of the things that we see the most is that the shift requires the pricing decisions are based on tiered market segmentation. Analytics can certainly help in making those decisions, but gaps can be found if there's a need for looking at potential what if scenarios and the impact that these decisions could have on revenue, profitability, and volume throughout the channel.

Lindsay Duran: One of the areas that has seen significant impact is just the way in which salespeople work over the course of the past year with a lot of people shifting more towards remote work and less in-person visiting of customers.

But certainly that acceleration to eCommerce has also impacted sales reps. How are you seeing companies address commissions [00:07:00] compensation and even making sure prices are aligned across eCommerce channels and more traditional sales rep lead gen?

Gary Brown: Yeah, that's a great question. I know Kyle has some great insight on this as well. I think the first thing is to really look at how they're compensated. So as sales reps, many work on a commission based structure. So if sales start to go say away from a distribution sales model to a more direct model that may impact their earnings, so know considerations need to be made for that. And in the way they're compensated, moving forward.

One of the things that we have seen, that's really interesting, is that sales is getting better insights through analytics, into customer buying habits and potential white space and recommended products that could be either cross sold or upsold based on the intelligence that's coming from that. So I think it's making their job better in terms of making more informed decisions, which in turn should impact their earning potential.

Lindsay Duran: [00:08:00] Thank you. You brought up some good points around how do you make sure that there's a good customer experience and kind of keeping that at the center of the focus, whether it's an eCommerce web sale or a sales rep led sale. And certainly customer centricity is much more than a buzz word. It's become a requirement.

Kyle, can you give me some examples of the way that buyer behavior has changed in recent years and what are the consequences of not evolving with that shift in buyer behavior?

Kyle Dreyer: Yes, absolutely. So I think the first thing to remember, and it seems obvious, but that individuals who are buyers for their organization also are consumers in their personal lives.

So obviously in today's world, nearly everyone shops online and these experiences have insignificantly improved over the last few years. What that implies is that those individuals that are buying at a consumer level now have an expectation of what shopping or buying [00:09:00] online is like. And now expect that when they're buying on behalf of their company, and for an example, one of our customers is an office furniture manufacturer.

And so when you go online as a consumer, you can configure a chair, which is actually a pretty complicated product offering. If you take the number of the types of fabrics and the colors of fabrics and all the optional add-ons one chair could have over a million different permutations of how it can be built.

So as a consumer, I would expect to be able to see that through some sort of 3D visualization engine. And what we have found is that the buyers, when this organization sells through their dealers and so organizations such as Salesforce, the buyers at Salesforce expect that same experience. And so as they're going through and they're building out a new office plan and they're adding those products and figuring out the different types of chairs and desks that they want to buy, they want to be able to have that same visualization that they've been able to come to expect from a consumer perspective.

I would say another example, as well as [00:10:00] keeping along the same lines of buyers having a consumer like desire is the ability to reorder quickly and efficiently. So when I log into my Amazon account, as I'm sure everyone on here has done, I have the ability to find a past order or they even push products to my homepage based on my past orders that allow me to really be able to buy and reorder as quickly as possible.

And our B2B customers, their customers, their distributors, their end users are expecting those same types of functionalities to be able to transact quickly and efficiently, really. They view their time as money and they gravitate towards those organizations that allow buying online. To be a simple process.

And so, as you can imagine, the consequences of not evolving with your buyers are you're simply going to decrease your market share that you have out there and from a digital perspective. And so what we have found is that customers that are being really innovative with their B2B Commerce platform, the ROI has really paid off [00:11:00] in spades for them after they do the implementation.

Lindsay Duran: And Gary I'll direct a similar question over to you. How have you seen leading manufacturers provide kind of an excellent customer centric experience, both online and offline? What are some of the critical things that are important in that?

Gary Brown: They are absolutely focused on making it easier for their customers to do business with great examples around omni-channel. Being able to meet the customer where, and when they'd like to engage, providing them with the information that they need to research potential uses for their products, and then being able to reach them in a way that's convenient for them. Partner and customer communities on the Salesforce platform are a great example.

We see manufacturing clients basically managing the journey from lead to customer service and everything in between. On the platform. So having that ability to manage those interactions again, I want to be able to get a product from you, give you the information I [00:12:00] need. How can I see it? Where can I see it now?

I want to engage with you. Can I buy on the platform? And then finally, once I'm a customer of yours, how can I get my product serviced? How can I file for rebates? How can I make this and access all the information that I need in one place and make it as seamless as possible. The other piece we also see is: How can I become self-sufficient? So can I go into your community and get answers to questions that I need to have without actually having to interact with a human being all the time? So those are some of the things that we're seeing in terms of manufacturers providing excellent service

Lindsay Duran: And what you described as clearly a significant departure from how manufacturers have been used to doing business. I mean, they've been forced to change some of these age old practices just to stay afloat. And certainly future disruptions are an inevitability. And I think these approaches will be a major asset going forward, even if it seemed somewhat forced [00:13:00] over the course of the past year.

Gary, what technology improvements do you think must be made to ensure more resiliency against kind of an unstable and ever-changing outlook for the industry?

Gary Brown: That's a great question. We often have discussions with our customers around the need for digital transformation, which is a word you hear used a lot these days.

And these discussions vary. Of course, based on the maturity of the organization we always see is that manufacturers are looking to leverage technology to increase their efficiencies, unlock and use siloed data. And expose opportunities to gain a competitive advantage as it relates to data. The first area we asked them to focus on is making the data accessible where, and when it's needed, the average enterprise organization, particularly manufacturing uses more than a thousand individual apps across their business.

And these apps are usually purpose-built, they're antiquated, they're highly customized they're on-prem and they're managed by different stakeholders. As a result, we see challenges related to [00:14:00] having those systems locked basically in a silo, integrating new apps with legacy systems and then unlocking data from multiple ERPs.

And they usually have multiple ERP because they grow through acquisition so to address these challenges, we help our clients develop and implement a transformational outcome-based systems integration plan. And once that plan and architecture is defined a digital platform with full API life cycle capabilities can be enabled to access that data.

So we do like to talk about MuleSoft as a preferred solution because it's scalable and allows you to bring information onto the central Salesforce platform and give manufacturers a full 360 degree view of their customers. Once that data becomes available, then you get to have some fun with it.

Right. We focus on making an action. For clients to make better business decisions. This can be done by leveraging Tableau CRM functionality that comes with Salesforce [00:15:00] has manufacturing cloud. As an example, out of the box dashboards can really help them manage their business around defining where the white spaces, how their products are doing, how their accounts are doing as it relates to compliance with sales agreements and how they can get more accurate sales forecasting.

And we then take it a step further by enabling AI to generate predicted time series based forecasting opportunity scoring and providing recommendations to help them increase the probability of winning new deals.

Lindsay Duran: I think you hit on something that was really key there and that's actionability. So how do I make sure that whatever insights I'm generating, regardless of the commercial part of my business that those insights might be touching, but how do I make sure that my salespeople can actually act on those and make better commercial decisions? And I think that's really key. I want to switch gears a little bit and talk more about the supply chain aspect.

I think the [00:16:00] pandemic showed just how interconnected we all really are. And we saw significant supply chain disruption over the course of 2020. And if you think about the events that just happened in Texas the week of Valentine's day with the power outages and the storms. We've seen significant disruption just in terms of water supply and power supply and getting food into grocery stores and restaurants.

And so I think it's pretty clear that supply chains can no longer be taken for granted as we've seen over the events of the past. Gary, what progress is being made in hardening and future-proofing supply chains.

Gary Brown: That's a great question. We're seeing the first area that they're focusing on is giving suppliers greater transparency into their customer's real time demand requirements.

They're [00:17:00] doing that through collaborative forecasting and integrated systems. By doing this suppliers can plan their demand, fulfillment better and communicate warning signs of potential product shortages much earlier in the process. Great example of this is in the automotive space where OEMs need to make sure that their tier one and tier two suppliers work together and ensure that supply requirements.

We're also seeing manufacturers become more diligent about identifying potential risk factors to suppliers by analyzing external and internal data related to contract compliance, finance operations, and global regulatory factors, which is really important in the automotive world. We're having conversations with clients about how AI can help detect and monitor these risk factors, which can allow manufacturers to better manage at risk suppliers while finding alternatives sources.

Lindsay Duran: And with that, how can companies better manage their supplier costs and figure out how to more effectively pass through [00:18:00] increases in costs in a scalable and repeatable manner.

Gary Brown: What we really see is that the transparency on costs and the impact that has on pricing is really a requirement for many of their customers, as well as for their supply chain.

And a great example is a client we recently worked with who's required to adjust their pricing based on changes to a global commodity cost index. Managing this can be quite complex and cumbersome. With multiple customers, products and formulas, and we're working with them to automate the process on the Salesforce platform, through systems integration with the commodity indexes.

Lindsay Duran: Thanks Gary. Kyle, I'd like to switch gears a bit and talk a little bit about the Acumen partnership with Zilliant. Can you share more about Acumen Solutions’ approach to adding value to manufacturing clients? And how the partnership with Zilliant benefits our joint customers?

Kyle Dreyer: Absolutely. Lindsay. Thank you.

So I view our [00:19:00] partnership with Zilliant as really one of the more exciting partnerships that we have out there. And there's a few reasons why, as Gary mentioned, a lot of our manufacturing customers grow through acquisition. And so because of that, they have a lot of ERP systems, right. And they manage pricing in all of these different ERP systems.

And getting that into a commerce engine to be able to obviously present the right pricing or a specific product to a customer can be quite challenging. And so the benefits of Zilliant are multifold, the first of which, it makes that entire process easier. Being able to get our pricing into our commerce engine, ensuring that the right pricing for the right customer or the right contract is presented to that user.

So that way they can transact with confidence. Additionally what most of our customers want to do from a digital commerce perspective is be able to actually measure how customers are responding to pricing changes. And so being able to, or having a customer that is interacting with us digitally allows us to [00:20:00] capture data and being able to see, do they go to a product detail page and then abandon that product? Do they add things to their cart but never check out? All of these actions that customers are taking, that we can only measure if they're interacting with us digitally and then we can use Zilliant to help respond to those changes and increase our share of the wallet.

And then obviously, as Gary mentioned, we have some customers where their pricing is based on the pricing of commodities in the market. And using Zilliant to actually manage this makes the challenge of having those updates in Salesforce, feed their eCommerce much simpler. So it's really an exciting partnership.

And it's something that we've seen some success with.

Lindsay Duran: We've mentioned Salesforce a few times during the conversation today. Can you talk a little bit about the partnership with Salesforce and really how Zilliant and Salesforce and Acumen come together more explicitly in the context of B2B Commerce?

Kyle Dreyer: Absolutely. So we are at [00:21:00] Acumen Solutions, a Salesforce company, and we prior to joining the Salesforce family, we were actually the leaders in Salesforce B2B Commerce. So we have done many different implementations across a variety of industries from nonprofit to pharmaceuticals, to consumer goods. But really our heavy focus is in manufacturing.

We've implemented Salesforce B2B Commerce for many different manufacturers. And why we view this as important is because the vast majority of companies have been using Salesforce for an extended period of time, whether it's Sales Cloud, Service Cloud, obviously some, if not most have, what is now Salesforce Experience Cloud, or what was Salesforce Communities.

So utilizing Salesforce B2B Commerce is a really natural fit for these organizations. And there's less of a lift to implement Salesforce B2B Commerce on the Salesforce platform. When you're already utilizing it, you have your account structure there. You potentially even have your products and some of your pricing in Salesforce [00:22:00] today.

And so what that allows us to do is have a much faster time to market from an implementation perspective. And then obviously our partnership with Zilliant allows us to utilize Zilliant within the context of B2B Commerce or other Salesforce clouds easily and very efficiently.

Lindsay Duran: And that fast time to market, I think, is really key just given the nature of the shift to eCommerce overall and the uptick that we're seeing in manufacturers trying to accelerate their investment and shift more business to those online channels. So with the uptick in eComm Kyle, let's talk about the kind of online, specific customer data that's flooding in and how companies can best capitalize it.

Kyle Dreyer: Absolutely. So the first piece that I would say is we're now able to track customer behavior.

So as they navigate through a B2B experience and they're viewing not only product detail pages, or potentially obviously creating orders or even abandoning carts.[00:23:00] But also being able to measure any of the static content pages that they're looking at, being able to look at their buying history and being able to push out product recommendations to them are all things that are becoming more and more important for our manufacturing customers.

The other piece is around and we've talked about this a couple of times, but the real-time market pricing. And so we have many customers that have a need to have real-time pricing. And obviously this implies that the pricing is always in flux, right? It's not static for a year. It's based on whether it's the price of commodities or other market factors that are necessitating that we change our pricing and again, we have some customers where that's such a critical need that we need to solve it. And then there's potentially one answer that we don't necessarily recommend of actually communicating or making an API call to your ERP system to actually gather that pricing data and present it to the user.

But there's a couple of challenges with that. [00:24:00] Mainly performance and mainly again, the multiple ERP system landscape that we see for these companies that have grown through acquisition. Again, that to me is really the big gap that Zilliant can help plug for us. And, we've taken the Zilliant product and been able to allow for changing pricing for products in a faster manner, and then have it presented so customers can go ahead and buy quickly and efficiently.

Lindsay Duran: What are some general trends, as far as technology adoption that you're seeing in the industry, Kyle, and how do you think the events of the past year have either accelerated or slowed those?

Kyle Dreyer: So 2020 was definitely accelerated digital transformation across the board for our customers. We saw a large uptick and not only our customers that were interested in either a new or revamped digital commerce experience, but we also saw a much greater urgency for these organizations to react quickly.

And so it was really interesting about last year for myself are several weeks. First in the [00:25:00] manufacturing space specifically, your manufacturers are typically a little bit more resistant to change in terms of being digital. And then the pandemic in 2020 really kind of forced the issue. And we had a lot less conversations about the quote unquote, why to go digital and really focused on the, how to go digital from a commerce perspective in creating these different digital channels to serve their different types of customers has become easier over the last few years.

So it was actually something that we were able to respond to very quickly and we helped many organizations take that first step into a digital transformation for their B2B customers. The next reason that I thought 2020 was really interesting is creating a digital experience exposes challenges within organizations, right?

So we're now taking data that's been locked into our ERP system and we're now exposing it to the outside world for our customers to actually go online and buy in. What was really interesting is [00:26:00] if you were to take the distributor landscape for manufacturers, right? Obviously they have distributors of all different shapes and sizes.

Well, one of the questions that I heard continuously throughout the last year, as we were implementing Salesforce B2B Commerce is why is our pricing so complicated for our smaller mid-level distributors? Isn't there a way that we can make this easier to manage and have it surfaced on a storefront quickly and efficiently?

And so there was kind of an understanding by the largest distributors, pricing was complicated, but we had a lot of conversations about how to simplify pricing around our small and medium distributors. And then lastly, I would say is those were the customers that our manufacturing customers were focused on those small and mid market distributors.

So they really saw 2020 as an opportunity to be the leader within their competitive landscape. And lastly, most of our customers were completely focused on growing their share of the wallet across their small and mid-market [00:27:00] distributors. So they were looking as this time of transition as a way to take that first step to be digital, to be able to allow those customers to self-serve not only from an ordering perspective, but also being able to do other tasks, like checking an order status, or being able to go in and request a quote for different pricing as well.

And so we were able to implement these and actually our manufacturing customers rethink the way that they view pricing across their small and mid distributors as well.

Lindsay Duran: I'd like to shift gears a bit and talk about the future. Right? We've talked quite a bit about the course of the past year and what manufacturers are currently experiencing, but directed to both of you and Kyle, we'll start with you first.

What capabilities do you foresee market leaders being able to bring to bear in the next year. And let's say in the next five years?

Kyle Dreyer: I think over the next five years, we've now have a lot of [00:28:00] manufacturers that have taken that first step to be digital. And that's a great starting point and that customers can now go online and they can buy, they can go view their order status.

They can do a whole host of features through a digital platform. But I think the next step that these manufacturers are going to want to take is really around personalization. And so what I mean by personalization is far more than customer specific pricing and the products that they have access to be able to buy.

But it's really about creating a digital channel that meets a customer where they're at and surfacing both static and dynamic content that are incredibly relevant to them. And it's also taking those data points where we're feeding data back, such as an order update, or being able to say this is when your delivery is going to arrive with your product and providing that information to them on any device and in the digital manner that they prefer, whether that's via SMS, actually having them log into the portal or simply an email as we would do today.

Lindsay Duran: And Gary I'll direct the same question to [00:29:00] you. What capabilities do you foresee the market leaders bringing to bear in the next five years?

Gary Brown: So that's a great question. If you asked me this question five years ago, I couldn't imagine what we're doing now.

So I think it's all about capturing data and most customers are still getting their arms around the data that they currently have and are capturing. That said, utilizing analytics to drive business decisions around desired outcomes will continue to iterate over time over the next one to five years. And this applies across the board, whether it's related to B2B Commerce, like Kyle's been talking about and personalization, maybe it's related to monetizing service through outcome-based servitization, we're aligning sales, finance, and ops on a central platform to improve forecasting and demand fulfillment.

85% of companies have accelerated digitization with 67% specifically accelerating AI and automation. And we expect that to continue over the next one to five years.

Lindsay Duran: I'd like to thank you, both Kyle and Gary for [00:30:00] joining us today. Where can our listeners go to learn more about Acumen Solutions and your perspective on manufacturing?

Kyle Dreyer: The listeners can absolutely go to our website at acumensolutions.com or we have also provided some collateral in the show notes on the landing page for this podcast.

Lindsay Duran: Perfect. Thank you. So definitely listeners visit the show notes to learn more. If you're enjoying our show please leave a rating and review so we can continue to provide valuable content for free.

Thank you. And we hope you'll join us for the next episode of B2B Reimagined.

Are you ready to learn how Zilliant can help you overcome your inflation challenges?

Reach out to us today to learn how we can help!