You don’t hear a lot about lean principles being applied to marketing, so I was pleased to attend a session on exactly that topic at the recent San Diego regional conference of the Association for Manufacturing Excellence.
The speaker was Jerry Fiala, a managing vice president of Capital One. For those of you who live in caves and have never seen any of their distinctive TV commercials, Capital One is a credit card company. And in recent years it has expanded its financial services footprint by buying a couple of banks.
But as much as what it does in actual financial services, Capital One is a marketing company. Fiala is a marketing executive, his role being to help the company get more customers.
The processes for doing that are “not markedly different from typical manufacturing processes,” Fiala said. Appropriately, his beginning-to-end name he uses for those processes is the Acquisition Value Chain (AVC).
The AVC annual volumes are impressive:
Several thousand different “creatives” developed
Several hundred solicitations executed
4,500 different Web pages
Over one billion mail offers
Millions of applications processed
Millions of welcome kits mailed
Capital One began its lean journey in 2003. The benefits being achieved are neither surprising nor unusual for anyone familiar with what lean can do, but they are significant.
For example, Fiala said that when he first joined the company, “I could get a direct mail piece out faster than I could change anything on my website.” A website change was taking 180 to 200 days. And at that time, the company wasn’t measuring things like cycle time or quality.
The initial lean initiatives reduced time in the Internet marketing process by 77 percent. Since then, further initiatives have not had much impact on the time in the process, but resulted in what Fiala said were big increases in capacity.
(As an aside, Fiala offered an interesting insight into marketing trends. “Much to our chagrin, direct mail continues to go away,” he said. “Its effectiveness is going down and down. There needs to be another way to acquire customers.”)
And as with lean transformations everywhere, the “soft” issues are the most challenging. Capital One trains employees extensively in an effort to create a lean culture. Also, Fiala commented, “Lean management is key to the transformation.”
Has your company attempted to make its marketing processes lean? What is your experience?
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