Eliminate Waste:
One of the challenges in today’s environment is to increase our levels of service while reducing expenses. However, in attempting to accomplish this we become vulnerable to many forms of compromise. And some of these compromises could have repercussions in the years to come.
Our industry has committed vast resources to system upgrades, possibly $60 billion to $70 billion. Advanced digital services have escalated in availability and customer acceptance. Customer service is becoming a reality rather than lip service. And, the quality of our field operations has improved substantially. This is resulting in greater professionalism as seen by our customers and by our employees. These are the makings of increased competitiveness and a path to greater profitability.
Along with these advances, we are feeling pressures to do more with less. Many of these pressures are helping to eliminate waste. But, some of these pressures appear to be doing more than promoting more efficient allocations of resources. It appears that some cost reductions have resulted in compromises in low profile areas such as drop installations. Let’s not allow ourselves to compromise longer-term viabilities in search of short-term savings.
Protect your drops
My company started to notice a concentration on shorter-term results when we heard that certain systems were told to refrain from ordering drop installation supplies and to use up what was in stock. In several cases what was in stock, unfortunately, were supplies that had been deemed to be inferior in light of the increased demands now placed on the the drop. In the short run these actions may reduce expenditures, thereby increasing cash flow and assisting in producing financial results that show smaller losses. We are not, however, in a short-run business. The costs of upgrading a system (which can run as high as $2,000 to $3,000 per subscriber) and the costs of acquiring subscribers are too great to jeopardize the long-term viability of the drop. The drop is one of the oft forgotten but most vulnerable parts of our system. We need to maintain a sensitivity that prevents installation errors, component fatigue and customer abuse. We need to install drops that look and act like the professional services we provide. We need long-lived drops to give us long-lived subscribers who will be satisfied with our service, who will appreciate the quality signal they receive and who will see professionalism in the installations we perform. To achieve this we must treat the drop as the important link that it is between us and our subscribers. And we must put as much care and forethought into the drop as we put into the rest of our plant. Maybe we can profit from some examples outside our industry. We all know that Wal-Mart made dynamic strides in cost reductions. It accomplished this by attention to operational efficiencies, not by lowering the quality of the items purchased. As budgets become tighter, we hope to see our industry put more pressures on suppliers to deliver products on timely, predictable bases, packaged for efficient use. We all want to see our industry’s quality remain high and drops installed correctly to insure the continued customer satisfaction that is necessary for the long-term viability of the industry. Ultimately, we are all dependent upon the strength of the long-term competitive position of the industry. And doesn’t that mean quality all the way to each and every outlet? Peter G. Mangone, Jr., is president of Telecrafter Products. Email him at [email protected].
