FOCUS ON BUSINESS
Handling Program Management Workload and Material Constraints
Strategic conversations are key to sustaining existing business.
The current business environment is creating two significant challenges for mid-tier electronics manufacturing services companies at a strategic planning level. The first is program management workload. Material exceptions have become the norm, and program teams have become highly reactive to respond to changing program variables. Second, material constraints are causing OEMs to keep projects at their current suppliers and push out launch plans on new products. Taken together, planning for account growth beyond what is automatically going in the pipeline based on spikes in existing demand may not be a great use of program management time.

While it is unlikely a significant number of projects will be awarded in the short term, a lot of dynamics in the background make strategically assessing larger accounts an important activity right now. These include:

  • The great resignation. While the media may have overhyped it, labor shortages are a reality, and people are moving around as a result. Do you have multiple relationships within each customer’s decision team? If you don’t and your key contact leaves, you will be building a relationship with someone who is viewing your company only from the perspective of the current market.
  • Customer chaos. The challenges within OEMs are as great as those within your company. In that environment, they may not be thinking strategically either. Can your company provide services to help address resource shortages within their teams they are unaware of?
  • Inaccurate capabilities perception. In a reactionary environment, decisions are made on the fly. In a long-term outsourcing relationship, OEMs can lose sight of the company their EMS provider has become, or assume capabilities are limited to those used in the projects that EMS provider is involved in.
  • Growing dissatisfaction. The current market is causing suppliers at all levels to give disappointing news on a regular basis. While experienced supply chain management teams understand what is happening, less experienced personnel may not. If the bulk of program team communication is delivering bad news, or if the ball is regularly getting dropped on issues the EMS provider should be able to control, dissatisfaction levels may be high.
  • Cross-company teamwork is high. Many EMS provider and OEM teams are working together closely. The relationships forged offer visibility into opportunities at a higher level than is usually found when team members trust each other.

Given the current workload, the next challenge is determining how this type of analysis can fit into busy schedules. Strategically analyzing larger accounts relative to the dynamics mentioned doesn’t need huge effort.

  • Customer contacts. Make a list of the decision-makers you interact with at each key account. If fewer than three, develop a strategy to build a relationship with one to two additional contacts.
  • Access what you know about the account. Are there opportunities for increasing the percentage of value-add in the account or growing into other divisions? What are this customer’s pain points? Do they have resource constraints in engineering or production you could help with? Would fulfilling to their end market help free up their team? Is your team doing everything possible to help them with alternate component identification? Has your team failed at anything lately, when they should have performed better, such as in quality, product validation, communication, etc.? Do you have a solution for anything your customer has casually mentioned about new projects or resource constraints? Is the customer aware of your current capabilities? In short, make a list of issues you think would benefit from a focused conversation.
  • Address dissatisfaction head on. If your team has fallen down on an aspect of the project they should have been able to control, do an internal review, document the corrective action and present it to the customer as quickly as possible. OEMs forgive issues created by the current market, but they aren’t understanding when they feel internal processes are out of control. The result of this conversation may be improved customer satisfaction, or it may be the realization irreparable damage has been done. Either way, it puts you in a better position to assess next steps with this account in an environment of scarce resources.
  • Educate, educate, educate. While it may seem difficult to have a strategic conversation in a reactionary environment, most customers are open to discussions that help solve their problems. An informational or educational approach centered on options for addressing specific pain points is generally welcome. This is also a good way to increase customer knowledge of capabilities or resources. A quarterly business review or similar periodic meeting is one path. If the customer is local, a lunch-and-learn session may be beneficial. If the customer is accessible by travel and open to visitors, a visit with a technical resource may be an option. Ideally, information should open the door to ways your company can better serve the customer and any associated divisions.

When a program manager is prepared, discussions on ways to align solutions more closely with short- and long-term customer needs become easier. Analyzing accounts for opportunities is one way to counter the continuous bad news on the materials front. This type of analysis also helps identify potential vulnerabilities and either address the issue or build the assumption of eventual business loss into the forecast. In the current high-inventory business environment, it is always a good idea to understand which accounts have growth potential and which are quietly planning an exit.

Susan Mucha Portrait
Susan Mucha
is president of Powell-Mucha Consulting Inc. (powell-muchaconsulting.com), a consulting firm providing strategic planning, training and market positioning support to EMS companies, and author of Find It. Book It. Grow It. A Robust Process for Account Acquisition in Electronics Manufacturing Services; smucha@powell-muchaconsulting.com.