Are you getting the return you expect from your program managers?

Electronics manufacturing services has a unique customer service challenge. Typically a program manager is the central point of contact for both customer service and profitability. In short, program managers often carry both a carrot and a stick. While the program management model and a matrix organizational structure make sense for EMS business models, there are both advantages and disadvantages to this approach.

On the positive side, a PM has a strong relationship with the customer and may be in the best position to negotiate a resolution when a customer’s requests or behavior are impacting profitability. An experienced PM can normally balance both sides of the equation with ease.

The qualifier in that sentence is the word “experienced.” The balancing act can break down when the program manager is inexperienced or comes from a culture where disagreement is considered rude.

Here are some tips for building consistency into the program management process:

Have a standard training program for PMs that includes both internal and industry-standard resources. IPC’s EMS Program Management Certification Program is an excellent way to develop a unified approach in training. It is also good to develop an internal familiarization program that includes a program management best practices manual and possibly an introductory coaching process that has new PMs shadowing experienced ones for a few weeks.

Consider a subordinate program administrator position for large accounts. One of the biggest challenges in EMS is finding experienced PMs. Creating a program manager-in-training position helps build bench strength.

Consider two tiers of program management. If there are some large customers with projects in multiple facilities, consider a two-tiered program management structure with one person managing the entire account strategically who has dotted-line relationships with PMs managing that customers’ programs at each facility. A variation of that is to have a global account manager on the sales side who works with PMs at the facility. The goal is to ensure that all divisions of that customer see consistency in service delivery throughout the company.  

Have a standardized internal program review format. Set up a dashboard with common metrics for program managers to track and update monthly. That can provide senior management with early visibility into developing issues in program management style.

Define standards for program management core competencies. Areas of focus should include communication practices, information organization practices, project performance measurement, issue identification and negotiation skills.

Define standards for issue resolution. There should be a clear understanding of what concessions a PM can make without higher authority to satisfy a customer. For example, some service-focused organizations set a dollar limit that a customer service representative can “spend” without approval to satisfy an unhappy customer. Typically those organizations also measure the frequency at which that money is spent and factor that into the employee’s performance review. There should also be a defined escalation process should the scope of the issue require higher-level review. Be sure to define unacceptable behaviors such as issue avoidance.

Periodically discuss common problems. Less-experienced PMs or those in cultures where disagreement is considered rude may be uncomfortable negotiating with demanding customers or talking to their managers if they are having difficulty dealing with an issue. Having quarterly discussions about typical issues that can come up with customers and discussing the best ways to handle them can help “shy” PMs open up about their concerns.

Reinforce the concept that in good business relationships both sides have responsibilities. The benefit of having a contract in place is that gives the PM rules of the road in terms of the customers’ responsibilities in the business relationship. Even without a contract in place, be sure that program managers are enforcing whatever business agreements have been made relative to forecasting, schedule flexibility limitations and receivables. Variations from those agreements should be the result of conscious concessions, rather than inconsistent enforcement. The PM should keep the relationship within “control limits” the same way production personnel keep manufacturing processes within control limits.

Create a program management council to support multi-facility companies or facilities with unique business segment needs. Multi-facility companies may have specialized regional practices. Some industry segments or regions also require special treatment. For example, Japanese OEMs have a distinctly different business model for outsourcing, and often EMS providers support that business with a specialized team. Having a council overseeing best practices in program management helps ensure variations in practices are results of conscious business decisions.

Have an annual program management conference. Program management is one of the most difficult jobs in the company. Just as annual sales meetings reward and recharge sales people, an annual program management conference serves as a way to discuss trends, strategize problem customers, recognize excellence and send a signal to PMs that their efforts are valued. The scale of the event can be limited to a reasonable budget.

Taking the time to build consistency into the program management process can pay big dividends. A strong program management team is often the largest competitive advantage an EMS provider can develop. A strong program manager can significantly drive profitability and increase revenue. However, the converse is also true. A weak PM can lose the entire year’s profit and drive customers away. Having a well-defined program management process with robust oversight can help mitigate that risk.

Susan Mucha is president of Powell-Mucha Consulting Inc. (powell-muchaconsulting.com), a consulting firm providing strategic planning, training and market positioning support to EMS companies and author of Find It. Book It. Grow It. A Robust Process for Account Acquisition in Electronics Manufacturing Service; smucha@powell-muchaconsulting.com.