Pine Valley Furniture Company Furniture

Pine Valley Furniture Company

Furniture manufacturers' and retailers' profitability is directly dependent on their ability to manage customer records, financial and transaction data, supply chain and production cost data accurately and efficiently. Studies indicate that the greater the ability of a manufacturer and retailer to manage these different types of data and use them to create and execute new strategies, the greater the cost savings and revenue generation potential (Salojarvi, Sainio, 2010).

In the case of the Pine Valley Furniture Company however there are several significant pitfalls the company is experiencing. First, furniture manufacturing is by nature a very supply-chain centric business model. Pine Valley is as a result facing the roadblock of not being able to get customer and channel sales data quickly enough to make decisions, as the data and information management systems are designed for supply chain management. Second, the data and information management systems are also designed to make manufacturing, not necessarily sales, more effective. The reliance on manufacturing-centric systems is a common problem many companies face when they attempt to be more customer- and sales-driven (Swartz, 2007). Third, the Pine Valley Manufacturing Company has treated customer data management and the ability to analyze customers as a secondary or tertiary strategy. This has created an overbalance of focus in their data and information management systems on only those activities and processes that can be used for better managing the manufacturing process. Pine Valley Furniture has an abundance of manufacturing, sourcing and supply chain data, yet cannot easily take this information and apply it to their retail channels, customers, services strategies or fine-tune pricing. As a result, the company is constrained and limited in how quickly and thoroughly the can react to the market and its opportunities and threats. Pine Valley Furniture Company is like many manufacturers however who have put production efficiency, not customer or retailer and dealer satisfaction, at the center of their company values from an it standpoint.

Overcoming the pitfalls of relying on it just for supply chain, production and manufacturing efficiency and not paying attention to customer data as a priority needs to change. Starting first with a redefining of data collection, reporting and analysis from the customer's standpoint, then progressing to the retail channels, the focus of it needs to shift to interpreting and analyzing demand, not just supply. Long-term marketing strategies including the measurement of product line sales by channel, analyzing the impact of pricing strategies by channel partner and product, and measuring the cost of returns by customer segment all need to be included. A redefinition of the it systems and platforms focused on customer data rejuvenates a company's go-to-market strategies and makes profitability more measurable (Salojarvi, Sainio, 2010). Pine Valley Furniture Company must also introduce an entirely new set of metrics and key performance indicators (KPIs) to better manage the customer, channel, retailer and service provider relationships they have. Included in metrics and KPIs there needs to be predictive analytics of customer purchasing, profitability and service return rates by segment (Nauck, Ruta, Spott, Azvine, 2006). The pitfalls that Pine Valley has experienced can be alleviated with more customer focused data.