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ACTIVE - Part 3
By Ida Zecco
This is the third
article in the series, which covers the six-step self-assessment
process, ACTIVE, to help you to hang-on to and grow your single
source of revenue, the customer.
A - Account Management
C - Customer Lifecycle vs. Sales Cycle
T - Account Team
I - Internal Infrastructure
V - Value Proposition
E - Enable Customer Involvement in Product/Service Development
T –
Team has been so overused, that it has little or no meaning to
employees today. Perhaps this is because we talk about team, but
we measure, recognize and reward individuals. Reward & Recognition
= Performance. Our employees meet the standards that are set by
management. Consider shifting your reward and recognition from
product to customer.
There
is no Account Manager that is successful alone. There are
countless, nameless, unrewarded, uncommissioned employees who are
part of a greater whole, a greater sale, a greater opportunity.
These vitally important teams of people are usually not organized
as members of Account Teams. This is a place where potential
breakdowns in the Customer Life Cycle take place. There is no
“customer focus” between Sales and Operations; instead, it is a
product focus: “Fill out the order, prepare the appropriate
paperwork and customer order tickets, feed them through the
system, build, test, deliver, switch it on.” These are the very
basics. This is about product. This is what everyone
does—including your competitor.
Completing these basic tasks to the highest standards is the very
least of what is expected from your customer. But, if you ask
yourself, “Within this step of the customer life cycle: what is
the expectation?” The question is how you provide the above
service/product to your customers. And, how do you know how well
it was received? What are your measurement criteria and are they
accurate? How are levels of the Account Team measured, rewarded
and recognized for their customer focus? Is
Operations/Engineering/Billing, etc., included in your yearly
Sales Conferences/Reward Seminars/Strategic Planning? Are you
bringing together all of the parts that affect revenues and
profits? Are they sharing information, ideas, and initiatives? Are
your internal organizations constantly reinventing the wheel—thus,
needlessly spending more because they do not regularly meet, plan
and strategize?
I will
review remaining elements of this self-assessment (the "IVE" in
ACTIVE) in subsequent newsletter editions.
Previous articles
in this series:
Part 1
Part
2
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Is Your Customer
Data a Competitive Asset?
By
Tom Gormley
This is the second
part in the series on the application of customer data management
(see Lauren Weiss' article, Strengthening Customer Relationships
With Data Integrity, 3/4/03), the management and utilization of
customer data, to improve the performance of customer service
organizations. An IT research group called the Center for
Information Systems Research (CISR), at the Massachusetts
Institute of Technology, recently published a Briefing paper
titled, “Customer Data as Competitive Asset.” While not focused on
customer service per se, the research has some valuable lessons
for customer service and other business managers who would like to
get more bang for their buck from existing customer data
resources.
MIT’s
study examined the practices of 15 companies in their management
and use of customer data, with a focus on identifying those
practices which created the most value as measured by metrics
including increased productivity, customer satisfaction, sales
conversion rates, cross-selling, and return on marketing
expenditures. We would summarize the major conclusions of MIT’s
research as:
Approach: The approaches companies use to transform customer
data into a valuable asset fall into three categories: a) Data
Utility, b) Enhanced Marketing, and c) Customer Intimacy. Each was
found to have at least some value, but each also has considerable
risks.
Value: Data utility, an “if you build it, they will come”
approach, led by IT, has minimal value and is ultimately destined
to fail, as business users and managers never really buy in (yet
many still fall into this trap). The enhanced marketing approach
yields excellent value in some projects, but less in others. It
puts responsibility for customer data management into the hands of
individual departments and business units, such as customer
service, but mostly led by the marketing organization. It also
lacks a central, core strategy for dealing with customer data
issues such as integration, accuracy, and security. Customer
intimacy appears to generate the most value, by completely
re-focusing an entire company around its customers and providing
rich customer data and insight to key constituents, to enable and
guide such dramatic change.
Recommendation: Choose either the enhanced marketing or
customer intimacy approach, based on your company’s strategy, and
its commitment to customer focus. Not every company should attempt
the customer intimacy approach, despite its apparent promise of
competitive gains in customer loyalty, retention, and market
penetration. That is because for many companies, even as they tout
the importance of customers to their business, the overriding
focus is really either product development or operations
excellence, and you can’t be all things to all people. The
customer intimacy approach to customer data is far too demanding
for companies that don’t have customers as their absolute number
one priority. If you want to read more about this view of three
corporate disciplines, pick up a copy of “The Discipline of Market
Leaders” by Treacy and Wiersma.
A very
interesting but not yet documented finding of this research was
that customer service departments were quite often last on the
list -- after marketing, sales, and others – to benefit from
investments in improving customer data. In the next Newsletter, we
will address what you can do to change that, to put more useful,
insightful, productivity-enhancing customer data into the hands of
your customer service reps, starting with the Basics, then
Analytics, and finally, Proactive customer knowledge.
If
you’d like to read the full, published MIT Briefing, “Customer
Data as Competitive Asset”, or discuss its findings, please
contact Tom Gormley, one of its authors as well as an Associate of
Customer Centricity, at
jtg3@alum.mit.edu.
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