Milling industry should redefine customer value for 21st century, keynote speaker says.

by Teresa Acklin
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   Flour millers must “look past the traditional and buy into the new millennium” to continue to create value for their customers, according to Richard R. DeGregorio, president and chief executive officer of Pioneer Flour Mills, San Antonio, Texas, U.S. In a succinct keynote address at the recent annual technical conference and trade show of the Association of Operative Millers in Phoenix, Mr. DeGregorio's comments centered on the conference theme, “Creating customer value through the A.O.M.”

   Traditionally, millers have identified customer value as consisting of quality, efficiency, service and price, he noted. While those attributes do create value today, Mr. DeGregorio suggested that the future definition of “value” was likely to contain additional components.

   “What else could (customers) want?” he inquired. “The best way to know is to ask.”

   Mr. DeGregorio said changes in the milling industry and in the determinants of customer value would be driven by explosive expansion in three key areas: population, technology and information. Citing projections that the global population will grow by two-thirds in the next 42 years, Mr. DeGregorio said the need to share the world's limited resources would force change in the flour milling and grain-based foods industries.

   Technology and the amount of information also will be driving forces for change, he said. “Eighty percent of technological advances have occurred in the last 100 years, and technological achievement will continue to accelerate,” Mr. DeGregorio stated. “Information is doubling every five years.”

   In light of these rapid developments, millers will need to ask questions constantly and listen well to the answers to determine how to create customer value in the future, he said. The industry will need to challenge itself to discover what customers really want and then to provide it, Mr. DeGregorio said.

   “I'd like to suggest we look at non-traditional values,” he said. “One might be a clean environment: no obvious dust, no rain water run-off, no pesticides, no herbicides, no chlorine, no bromine, packaging (capable of being recycled).”

   In this area, millers should ask how the industry impacts the environment, which aspects are important to customers and what compromises might be necessary, he said.

   The milling industry also needs to pay attention to research efforts and the development of new technologies, from wheat breeding to harvesting to milling and baking processes, to assure quality is maintained, Mr. DeGregorio advised. Working together with regulators also will be critical for preservation of the quality of grain-based foods, he stressed. “We still have to make good cakes, cookies, bagels,” he noted.

   An increasing focus on the nutritional characteristics of flour also could be a “non-traditional” area of creating customer value, Mr. DeGregorio said, adding that millers should ask the question, “Should we improve the healthful benefits that these products provide?”

   He said the biggest challenges facing millers would be to listen to customers and determine which issues, in fact, would create value for them.

   “Can we do all this and still have products look, taste and smell good?” Mr. DeGregorio asked. “These are exciting times, and the A.O.M. has a responsible and bright future.”