Quick quotes to manufacturing customers—guaranteed

When a metal fabrication shop delivers a quote first, it has a strategic advantage. That advantage will help its customer base and business. Getty Images

When it comes to winning quotes as a fab shop, speed is critical. And several operational excellence strategies can help streamline the process to provide a fast, reliable turnaround time for quotes to customers (including new ones) to help you earn more business and grow.

The Priming Effect of Being First

By the time customers or prospects request a quote from you, they’re typically a well-qualified lead. They want what a supplier has, even if they don’t know exactly who they’re going to get it from yet.

When a fab shop delivers a quote first, it has a strategic advantage. All other quotes will be compared to this first quote. Price, quality, delivery, warranty, and any other element will serve as the benchmark for all other quotes that follow. In that way, the first quote will always remain foremost in the customer’s mind.

Speed is also critical when the customer doesn’t have the luxury of time to shop around for multiple quotes. When some customers request a quote, their business model—whether due to a lack of planning or organization—may mean they always have an urgent need for a quote. In this case the situation is simple: Speed often equals a win, even if your price is higher.

Quotes need to be reliably fast. If customers receive a quote from your fab shop in four hours, then they will hold you to this performance. They will trust that if they get a request to you by 9 a.m., they’ll have a response by 1 p.m. Such quick response makes their lives easier and, as a result, they’ll be more likely to come to you in the future. But if you take three days to respond to their next quote request, they will see your quote turnaround time as unreliable. That puts their satisfaction and their business at risk.

Once you understand what’s important to customers and prospects—in this case speed, though it could be other factors like level of detail or delivery requirements—those important factors should serve as the destination or end point for your quoting value streams. Once you establish these parameters, you can design the quoting value stream to meet them.

Value Streams for Quoting

I’m sure you have heard this before: “We will just value-stream-map (VSM) our quoting process. We’ll get a bunch of people together, map out how the quoting process works, look for opportunities to improve, identify them, build a future state with the waste removed, then run kaizens or rapid improvement events to eliminate the waste.” You just need to use VSM and kaizens, two straightforward lean manufacturing tools, right? Well, not if you want to achieve operational excellence and grow your business.

In conventional VSM, you search for opportunities to eliminate waste. Over time this becomes a whack-a-mole approach of searching out waste and hitting it with a hammer, only to find waste popping up someplace else. So you swing the kaizen hammer again … and again. This does not develop a systematic method for delivering quotes quickly and reliably.

Instead, you need to design how a quoting value stream will work by using nine guidelines that help you determine how you capture knowledge from each quote and establish how information flows. The net result will be an established guaranteed turnaround time (GTT) for on-time quotes and a process. And achieving your GTT shouldn’t require management intervention.

Design Quoting Value Streams

Generating quotes for customers is a service the office provides. Therefore, the first step in value stream design is identifying the service families. This involves grouping together services based on similarity in processing steps and total work content. One way to do this is to think about the different types of quotes performed and the number of processes required in each. Some quotes might go through only two steps, while others go through 20 or more. Mapping these out on a spreadsheet will help identify the families.

Also consider how your customers buy. Do they buy large inventory quantities? Or do they buy only what they need when they need it, and if so, how urgent is the purchase? Based on what you uncover, you could categorize your families by the processes involved along with the nature of their purchasing behavior.

For example, you could have one service family for those with few quoting steps and last-minute requests and another family with quotes having lots of steps that are not next-day requests. For both, you need to establish a GTT and not shuffle the deck based on management intervention.

Once you establish your service families, you’ll create a current-state VSM for each family. This helps depict the way information flows and compares the total lead time required to deliver the service to the process time that’s actually required to perform the service. Your team should ask people in the quoting department (including those who actually perform the work) how they know what to work on next, where they get their work from, where they send it when they’re done, and how they know when to send their work.

Nine Lean Guidelines

The next stage is to apply lean guidelines to each family. The nine guidelines that follow should help you match output to customer demand, connect processes, put predictable and repeatable timing into the office, and tell if work in the office is completed on time. The nine guidelines are:

1. Takt and Takt Capability. Takt time is the rate of customer demand. In cases with a high variation or erratic demand, you can use takt capability, which allows the quoting team to set a capability based on what can be done in terms of mix and volume. For instance, if you don’t know how many quote requests will be received each week, you would set a takt capability of how many quotes could be completed in a week in terms of the volume and mix of quotes.

2. Continuous Flow. Continuous flow means completing one activity and moving the work on to the next process in the flow without stoppage or interruption. So, instead of everyone individually prioritizing their own work, which can lead to lots of status meetings and re-establishing priorities, quoting-team employees work in a continuous-flow processing cell, which meets at preset times throughout the day or week to complete all the work before moving it on to the next activity.

3. First In, First Out (FIFO). Where processes can’t be combined or put into continuous flow, they should be connected using FIFO (first in, first out). FIFO is still a form of flow because work is moving forward in sequence without priority changes, reroutes, or management decisions.

4. Workflow Cycles. These refer to the rate at which work moves or flows within or between different work areas or departments along a fixed path. They dictate the time by which work should be completed and help stabilize the flow of information in the office.

5. Integration Events. Workflow cycles are used to flow work on a consistent or regular basis. However, work may not need to flow on a regular basis. It may need to flow only every quarter, when a new product launches, or when you need to send information to an outside service provider. In these situations, an integration event helps facilitate the handoff of large amounts of information from one area of the company to another or to an outside service.

6. Standard Work. Standard work ensures that flow in the office is repeatable and predictable, no matter who performs the work. Over time the person performing the job might not need to consult the standard work document every time he or she begins to work. However, in the beginning, it is a good idea to follow the steps to ensure good habits are developed.

7. Single-point Initialization. One of the keys to achieving flow and GTT lies in eliminating the constant reprioritization of work. To eliminate the randomness in selecting work, try to set one single point in the value stream where the customer introduces work. Ideally, the initialization point is set where the request first comes into the value stream from the customer. This is particularly important in quoting since, otherwise, a customer may email their familiar sales rep each time for a quote, which can be problematic if the rep is in a meeting or on vacation when the request comes in. While the relationship with their sales rep matters, what customers value most is getting the service or product on time, every time. That’s the key to securing more business.

8. Pitch. While the previous guidelines were all about designing flow, pitch is a tool that enables anyone to easily see whether the flow is operating normally without having to interrupt or ask questions of employees. Even a visitor to your business should be able to tell if work is on time. For example, you might use a green flag to indicate work has been completed on time and a red flag to indicate work is behind.

9. Changes in Demand. It’s very common for the demand for a service family to fluctuate. When fluctuations happen while operating under the normal takt capability, it’s important to examine the front end of the business and consider the requests coming in or inputs into the value stream. When examining these factors, determine if the fluctuation is a temporary change in demand or a true, permanent increase (or decrease). If it turns out that you are experiencing a permanent change in demand, you then need to switch to another takt capability.

By applying these guidelines, you will create a flow of how a quote gets delivered to the customer—without stoppages. They apply even in the era of remote work. If your workers are still off-site, you might rely more on videoconferencing to complete continuous-flow cells, for example, but the same techniques apply. As long as you design the remote setting into your value stream, you should be able to maintain flow in quoting without employees reverting to working through their inbox at their own pace.

Normal Versus Abnormal Flow

If your value stream design achieves your targeted turnaround time for quotes, you’ve established one of the foundational principles of operational excellence: normal versus abnormal flow. The designed value stream establishes exactly what normal flow is and the performance of normal flow in terms of a GTT. When information doesn’t flow as it should, something abnormal has occurred, and in operational excellence, how you handle that abnormal really counts. Instead of calling in management or having endless meetings (or even daily meetings), you establish a process to self-correct and resume normal flow without the need for management intervention.

Whether you choose a visual indicator or other method, when employees see abnormal flow occurring, everyone should know what to do because they are taught to use standard work to handle any disruption. This could be something like a checklist or decision-tree flowchart. When employees recognize abnormal flow, management won’t need to set priorities or hold meetings to get quotes out to customers. Instead, the quoting department will essentially run itself.

Connecting Flow to Your Customers’

While creating value stream flow in your quoting is an essential step to winning business, you can further maximize the results of your efforts by connecting your processes to your customers’. One way to do this is to educate your customers about your process so they can sync with it. So, for example, you can explain that if they get in a request to you by 9 a.m., they will have a response by 1 p.m. Or if they’re a big customer, design a flow just for them and link your workflow cycles based on their needs. The key is to make yourself the easiest supplier to do business with by connecting your flow with theirs.

That’s a way operational excellence can drive innovation in your sales process. But first a fab shop has to earn that right by following the guidelines to design a systematic way of getting quotes out without the need for management intervention. It then can implement that design to deliver quotes day in and day out reliably and with consistent turnaround times, guaranteed.