8/1/2002
Cost Cutting, But Not At Expense Of Customer Relations
By Dave Wooldridge
Having spent my teenage years primarily in the late ’60s, one of my favorite singers was Bob Dylan. Still is for that matter. And although Bob wrote his music for quite a different audience than I have been addressing for nearly two decades, there is a line from one of his songs that rings true for our industry today. And that is, "He who isn’t busy being born is busy dying."
I don’t think there has ever been a time in the life of an engine builder, equipment, parts or service manufacturer/supplier where change, at all levels – from OEM technology and marketing to the installer to the vehicle owner – has forced every one of us to examine how we do business. It’s forced us to examine our costs, our product offering, our delivery of product and our customer service policies. Most importantly, it’s made us all realize that the market has changed forever. It isn’t ever going to be the way it used to be – whatever that may have meant for you.
We can all relate to the pressure for lower pricing and the demand for higher quality parts and service levels that have been characteristic of the engine building market for quite some time. It seems that for many engine builders, as well as their suppliers, if you aren’t providing both you have lost market share.
Unfortunately for many companies, trying to provide more for less has cost them the ability to run their operations profitably. And consequently, left them with a lack of resources to make the necessary investments in product, facilities and people, as well as weather recent market downturns.
I wouldn’t argue with the need for cutting costs so that your pricing and your product quality can be where the market demands that they be.
The one area, however, where I think companies have made unforeseen, yet very costly business cuts, is in their technical, service and sales staffs. In the long run, the companies that will be the lasting winners will be those that have the best customer relationships. And it’s the people on these fronts who really make the difference.
Dave Wooldridge is the publisher of Engine Builder. He has covered the engine building aftermarket for 18 years. dwooldridge@babcox.com