by Debra Ellis
Inventory management is a risky business. Too much product on hand increases carrying costs. Too little reduces customer satisfaction. Finding the perfect balance between the two is near impossible.
The best managers know that they are in the risk management business and use every available tool to minimize their exposure. One key component is the cost of backorders. Knowing how much being out of stock costs your company helps refine the order decision.
There are both short-term and long-term costs associated with backorders. The short-term are the processing costs for multiple shipments to customers and receipts from vendors.
The long-term costs should keep you awake at night.
Being out of stock costs you customers. [click to continue…]
If you like this post, please share it:
by Debra Ellis
Social media offers us an opportunity to build our own virtual community. One would think that if you are creating the community, you would have control over the participants. You do, if you make it private. If not, your online community is like a real neighborhood filled with friends, dissidents, curmudgeons, and trolls. There are also figments – users who aren’t really present and sometimes aren’t real.
The difference between real and virtual neighborhoods is management. Active users of social media have to manage their community. They have to choose who to follow or friend, when to block, and how to respond to trolls. It can easily consume hours every day.
If you want a good community, the management cannot be automated. There are tools that speed the process, but your eyes are needed to differentiate between the good, bad, and nonexistent. They all look the same to a bot. You have to clean it up yourself.
Last week Sharon Mostyn (@sharonmostyn) asked about managetwitter.com. Since I’m continuously testing new tools, I decided to check it out. The functionality for managing following/followers is similar to Buzzom.com, but one different feature was particularly appealing to me. It allowed me to see inactive people that I was following. [click to continue…]
If you like this post, please share it:
by Debra Ellis
The gauges in your car have a purpose. They monitor the health of your engine. The original design was simple and effective. A knowledgeable driver could tell with a glance at the dashboard if there were any problems or potential issues.
Engineers, being what they are, couldn’t leave well enough alone. They knew that some people wouldn’t learn how to read the gauges. Surely, they could make it easier. And they did. Indicator lights replaced the gauges hiding potential issues until they became problems. Instead of a gauge that showed the engine’s temperature, a light flashed when the engine was overheating. The opportunity to stop the vehicle before the heat reached a critical level was lost. The new feature quickly became known as “idiot lights”.
Being an engineer, I completely understand the urge to make things easier, faster, and better. But, in my experience, every time I try to make something idiot proof, along comes a better idiot. Albert Einstein said, “Everything should be as simple as possible, but not simpler.”
And that’s the problem with most key performance indicators (KPI’s).
They are too simple to provide [click to continue…]
If you like this post, please share it:
by Debra Ellis
Last night I watched teenage boys celebrate the end of their basketball season. There were four teams, Blue, White, Red and Wildcats. All of the boys were classmates. The Red and White teams were in the same league so they had played each other during their regular season. For three months, there had been trash talk between these boys:
“Social media replaces all other marketing.”
“Direct mail brings in the money.”
“If it wasn’t for marketing, operations wouldn’t exist.”
“Operations fix the problems marketing creates.”
Oops! Wrong boys. I’ll get to them in a bit. The basketball boys were more into “our team is better than yours because we play in a tougher league” or “we’re gonna trash you when we play tonight“.
So how do all American boys celebrate the end of their basketball season? [click to continue…]
If you like this post, please share it:
by Debra Ellis
Fear of the unknown is the number one reason for change resistance. People like to feel safe in their comfort zone. Safety in the status quo is an illusion, but it doesn’t matter. It feels normal, so everything must be fine.
When people are resistance to change, forcing them to move forward creates resentment and reduces your chances for success. There are two reactions when presentations begin with “this will change the way we do business forever”. The first is skepticism. The second is resistance. Not your standard “I don’t think this will work” kind of hesitancy, but dig your heels in like my grandfather’s mule on a cold day refusal to move. And, the more you encourage, plead, cajole, or beg, [click to continue…]
If you like this post, please share it:
