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Andy Lyons is Professor of Operations & Supply Chain Management in the Management School and leads the ERDF-funded Collaborate to Innovate (C2i) project which provides support to small and medium-sized manufacturers throughout the North West region
“Troubleshooter returned to our television screens last week in the form of Lord Digby Jones, former Director General at the CBI and well-known business advisor. The original series was screened in the early 1990s with Sir John Harvey-Jones in charge.
“My enduring memory of the original Troubleshooter, apart from Private Eye’s mercilessly irreverent parody of the programmes, was Sir John’s relentless encouragement for his small business clients to rationalise their activities and product ranges and focus on core business. A generation later, this same message was conspicuous in the first programme of the new series.
“The client company, Hereford Furniture, was faced with the challenge of a wide but loss-making product portfolio. Managing product proliferation is not an uncommon challenge for small manufacturing businesses, who respond to their ambitions to grow, fill a big space in the market and satisfy an apparent consumer desire for lots of different product options, by expanding their product ranges.
“The problem with the proliferation of products and product options is that it can lead to excessively high levels of complexity in order management and in operations and supply chain systems.
“Hereford’s response to its own product proliferation dilemma was a plan to dramatically cut the number of products offered and, alarmingly, to “get the customer to order what we make”. This was quite a drastic action and one that may not have needed to cut so deep into the product range.
“There are approaches to mitigating the effects of the complexity, and reducing the costs, associated with the provision of a wide product range without such radical measures. These approaches include understanding the real needs of different segments of the market; the use of modular designs and delaying the point of product differentiation within the overall build cycle in order to forecast more easily and balance inventories with lead times; the adoption of costing systems that can establish and monitor the comparative profit contributions of different products; lean methods to cut out extraneous activity; configure production run lengths and streamline product flows; and the use of small-scale, integrated IT to keep a handle on performance and provide connectivity between business processes.
More can be more
“We live in an increasingly consumer-driven society where choice is expected and broad product lines, customisation and personalisation are becoming the norm. This trend is unlikely to change. The businesses that succeed will be those that can provide wide product and service choices that are desired by consumers, but can do so efficiently and, in the case of manufactured products, in a manner where supply, production and distribution are carefully matched to demand.
“For many small businesses, when it comes to consumer choice and product diversity, more is often less but this need not always be the case, with the right approaches to integrating marketing and operations’ activities and understanding the trade-offs involved, more can be more.”
To watch Troubleshooter on BBC’s iPlayer, please follow this link
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