A Different Way of Looking At Our Businesses - From the Chairman
Construction Equipment Distribution magazine is published by the Associated Equipment Distributors, a nonprofit trade association founded in 1919, whose membership is primarily comprised of the leading equipment dealerships and rental companies in the U.S. and Canada. AED membership also includes equipment manufacturers and industry-service firms. CED magazine has been published continuously since 1920. Associated Equipment Distributors
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SECTION: From the Chairman

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A Different Way of Looking At Our Businesses

Written By: Dale Leppo

Article Date: 07-03-2006
Copyright(C) 2008 Associated Equipment Distributors. All Rights Reserved.

Maximizing where we add value and eliminating where we don't.

The 2006 AED/QUALCOMM Executive Forum September 7-8 in Chicago is entitled "Lean Distribution." When Matt Di Iorio first proposed the topic I asked him how it was relevant to my business?

He responded by giving me an audio copy of the book "Lean Solutions: How Companies and Customers Can Create Value and Wealth Together" by James P. Womack. I'd driven to Chicago for an AED meeting and had a perfect opportunity to listen to the book on my return trip. I liked it so much I lent it to my brother.

What's so interesting about Lean is that it's a different way of looking at our businesses. In a manufacturing environment, Lean is focused on reducing costs while improving efficiency and quality. Automobile manufacturers got on the Lean bandwagon early, and many other manufacturing companies are now practicing Lean methods, including many construction equipment manufacturers.

My initial reaction was, "OK, I can see the manufacturing applications, but how does Lean translate into the equipment distribution world?" The answers were a challenge to my view of our industry.

Womack says we need to evaluate every step in our processes to see where we add value and where we don't, then we maximize the first and eliminate as much of the second as possible. That sounds obvious and simple until you consider issues like these:

  •  Our rental areas are always busy on Monday mornings and Friday afternoons, driven by our customers' demands for equipment. That schedule creates staffing and customer service issues for our company. Is there a way to shift some of that demand to an off-peak time?
  • Our service writers are so busy first thing most mornings that our process bogs down and customers have to wait for us to catch up. How can we quickly process the early morning service rush without overstaffing for the rest of the day? How can we encourage customers to show up for their scheduled appointment? How do we deal with the "emergency" problems that seem to come up every day?
  • Our sales process doesn't do a good job of forecasting demand. How can we get the data we need from our customers so we have the right equipment in stock when they want it?
If any of those issues is a concern for your company, join us at Executive Forum. The goal of Lean Distribution is to make us more efficient at taking our products and services to our existing and potential customers while at the same time creating a simpler, easier and hopefully, more satisfying experience for those customers.

My second topic is the new position at AED: Director of Membership Development. I'll quote from the AED Board of Director's documentation for this role, because it spells out what we're trying to accomplish with the new position: "Membership is the life-blood of AED. We must do everything within our power to preserve, strengthen, and grow it."

The Director of Membership Development will be AED's membership point person and will be responsible for:

  • Designing and executing innovative and aggressive membership recruitment and retention programs, focusing primarily on dealers but also developing opportunities to attract and retain manufacturer and sustaining members
  • Increasing new member recruitment, current member retention, and net membership growth from current levels
  • Determining how AED can get both active and inactive members more engaged in the association's activities, and coordinating efforts to make that happen
  • Determining both member and non-member wants and needs, how AED's existing services are viewed, and the causes of member and non-member satisfaction or dissatisfaction and communicating that information to others in the leadership
  • Recommending ways to increase member satisfaction, improve awareness of AED's services and identify processes to develop new services
  • Communicating to leadership how AED can increase its value to members
I think you get the idea. AED's existing staff has done a great job of increasing membership during the last several years. Our objective is to continue that momentum and take AED to a higher level.

By the time you read this, the Director of Membership Development may be on board. If he or she contacts you, please take a minute to say "Hi!" or answer an email. The only reason AED exists, and the reason we have created this position, is to serve our industry in the best way possible. A few minutes of your time now should yield long-term dividends for all of us.

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