The Reality of Direct Store Delivery
by: Paul Winkler
Director of Marketing
NCS - Numeric Computer Systems, Inc.

April 27, 2004 - Food Logistics Magazine

 

There’s a new reality-based show on TV where CEO’s volunteer to climb down from the Ivory Tower to mingle anonymously with the consumers of their company’s product while working alongside the company’s employees who serve those customers.

OK, I admit it. I’m probably the only person who is not a fan of reality TV. This is due to the fact that these shows surprisingly don’t reflect reality as known by regular run of the mill citizens. However, the intriguing aspect of this reality-based show is that the regular rank and file employee can watch someone from the Ivory Tower allegedly "get their due" in the comfort of their own home. For this reason alone I think the show will resonate with the average citizen. I’ve heard this wish - voiced numerous times in questions while working in the trenches over the years. “Do the people upstairs know what really goes on out here?” or “They should spend a day with me on the road!” This was usually in response to yet another edict, process, or step added to the daily routine sent down from some anonymous someone from above.

According to the article I read about this show, the grueling week spent in the field humbled the CEO’s. They also learned a lot about their own companies from a daily operations perspective. Fresh from the field, they comment about improvements they will make in the workplace due to their week long first hand experience.

A unique aspect of the show is that it focuses on the very place where the survival of a company hangs in the balance every single day. This is the place where the magic occurs, where supply and demand touch, where the decision to buy a product is ultimately made. In the fast moving consumer goods industry, this magic happens millions of times every day and it takes the coordinated effort of various groups within an organization to win each and every customer, every single day.

The Weakest Link
Speaking of coordinated effort, I’m a fan of Eli Goldratt, the originator of TOC or The Theory of Constraints. In a nutshell, TOC is likened to a chain with each link representing a specific process within an organization. This entire chain created by these links of individual processes is capable of great strength, but is also limited by the weakness of any of its individual links. TOC, although its basis was formed in the manufacturing environment, can help address the need for on-going improvement in any part of an organization by identifying the processes that need improvement, how the process needs to be changed and how to make that change happen.

Through TOC, companies can manage the inevitable change that impacts their organization, rather than letting change manage them. This ability can be a competitive differentiator. The improvement process begins by identifying the weak links (processes) in the chain. The only way to identify those links is to know intimately what they are and how they interrelate with each other.

Understanding the Links in the Chain
Long before reality TV hit the airwaves a number of progressive companies were sending their own up-and-coming executives to work in the field for a period of time. It helped executives gain a solid understanding of the source of their company’s revenue and the activity required to get it usually through direct interaction with the customer such as pumping gas, running a register, or delivering soda. This gritty, sweaty "back to the company’s roots" field experience can be an excellent teacher to students willing to learn from it. It gives executive “students” a unique view of their company emphasizing the importance of the whole enterprise and its interdependent internal processes that work together to satisfy consumer demand.

The Consumer Link
The supply chain should really be depicted as a bike chain with the master link representing the consumer. This master link, for those of you who never took your bike apart as a kid, is the link that connects all the other links together creating a continuous loop using a linear chain. This is the link of which all the other links depend. This master link (the consumer) is the point where all the coordinated efforts of all the groups within an organization come to fruition or failure. The consumer is located at this crucial point, the point where supply and demand meet. Consumer sales success depends on this huge inter-related team to ensure that the right product is available, is fresh and in excellent condition ready at the point of purchase.

Your DSD Team and Daily Reality
Your DSD team should be doing more for your organization than just taking orders, delivery and merchandising. They should be capturing and relaying a continual flow of empirical information providing a clearer picture of what’s happening outside the four walls of your organization. This fount of priceless information can impact the entire organization from strategic and tactical planning, to daily operations.

The reality is that your DSD team – drivers, sales representatives and merchandisers should be providing your business with the same field level information that the CEO’s received first hand while working along side their field level employees on the reality TV show. Your DSD team members are, in fact, your company’s eyes, ears and hands at retail. They’ve built relationships, they hear intuitively the "news" on the street, they watch, listen and talk to consumers at the shelf, they know subtleties of the marketplace.

The CEO’s on this reality-based show observed first hand the complex inter-dependent facets needed to make the magic happen whether it’s winning a new customer or keeping an existing one. They received a lot of good information participating in this new reality-based show, but it’s still up to them to take this information to drive continual improvements that can differentiate their organization either in their products, their people or their service. In my book, this flow of information coupled with the ability to act on sudden changes in the market is what keeps the DSD organization relevant and a jewel of distribution in a very competitive marketplace.


Paul J. Winkler is director of marketing and alliances for Numeric Computer Systems, Hauppauge, NY. He has 20 years experience in the consumer packaged goods industry, working primarily in food distribution and logistics.