boston.com Business your connection to The Boston Globe
BUSINESS INTELLIGENCE

Using technology to make life easier for consumers

Lean thinking has been working its magic in production and distribution, squeezing out costs and generating customer savings. Now, long overdue, it's about to shake up the field of consumption.

In an essay titled ''Lean Consumption" in the latest issue of Harvard Business Review, researchers James P. Womack of Brookline and Daniel T. Jones of Herefordshire, England, lay out the next phase of the lean revolution: using technology to reduce time and hassle for customers and get them what they want when they want it.

''Lean consumption requires a fundamental shift in the way retailers, service providers, manufacturers, and suppliers think about the relationship between provision and consumption, and the role their customers play in these processes," they write. ''It also requires consumers to change the nature of their relationship with the companies they patronize. Consumers and providers must start collaborating to minimize total cost and wasted time and to create new value."

More than anything, this is a matter of streamlining the systems for providing goods and services to make things easier for customers, Womack and Jones contend. The growing number of global companies that have begun doing that, from Japan's Fujitsu Services to Portugal's Grupo Fernando Simao, ''are learning more about their customers, strengthening consumer loyalty, and attracting new customers, who defect from less user-friendly companies," they report.

The ''customer is king" mantra has been around for decades. But only now, with an explosion of technology and consumer choices, has lean consumption become a competitive necessity.

''Everyone talks about the customer," Womack, a former MIT researcher who is now president of the Lean Enterprise Institute in Brookline, said in an interview. ''But if you don't have a process to make this happen, it doesn't matter how devout you are."

Womack says consuming remains frustrating, despite a wider range of products at lower prices. He blames this on an ''asset-backward situation" where too many companies have come to believe their job is convincing people that they want what the company knows how to do. But that will no longer be possible in the future, he believes.

Retail giants like Wal-Mart Inc. stock up to 100,000 items at their warehouse stores. But the average family buys only about 300, Womack notes. ''To get to those 300," he said, ''you have to walk by 99,700."

In the United Kingdom, retailer Tesco is experimenting with different store formats, such as smaller-scale ''metro" stores planted in city neighborhoods that take advantage of Tesco's supply chain efficiencies but also let customers shop closer to their homes.

''People want to get what they need where they need it," Womack said. ''Many people really want a smaller number of choices."

Other companies have reinvented their customer service operations. Instead of staffing a ''help desk" with the least knowledgeable employees and getting customers off the phone quickly, Fujitsu, which provides outsourced customer service to businesses, deploys experts to identify and fix the source of a customer's problem. In doing so, it dramatically reduces complaints about recurring problems.

Womack and Jones outline the principles underlying lean consumption: solving the customer's problem by insuring goods and services work, and work together; not wasting the customer's time; and providing exactly what the customer wants where and when it's wanted.

Lean consumption ideas are making their way into business schools and companies seeking to attract and retain customers. Philip M. ''Perry" Lowe, marketing professor at Bentley College in Waltham, said he advises businesses to use technology to lock in customers.

''It's a pressure cooker environment," Lowe said. ''After you whack away at costs, whether it's cutting jobs or maximizing the supply chain, it really comes down to sales and meeting customer needs."

Robert Weisman can be reached at weisman@globe.com.

SEARCH THE ARCHIVES
 
Today (free)
Yesterday (free)
Past 30 days
Last 12 months
 Advanced search / Historic Archives