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Reinventing Customer Relationships

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Have you taken a serious look at your customer relationships recently? If not, now would be a good time.

Recently, IBM polled more than 1500 CEOs, general managers, and public sector leaders around the globe on a variety of topics, including customer relationships. This cross-section of executives represented organizations in 60 countries and 33 different industries.

When asked how they saw customer expectations changing over the next five years, 82 percent of survey participants said they expect customers to demand a better understanding of their needs. Not ask for, but demand. Seventy percent said their customers would expect new and different services.

So it’s not surprising that business leaders are putting customer intimacy higher on their list of strategic priorities. In fact, 88 percent of those polled identified “getting closer to the customer” as the most important factor in realizing their strategies over the next five years.

Keep in mind that these are not consultants, keynote speakers or “thought leaders” making these statements (although we do make valuable contributions every now and then ourselves). These are leaders of highly successful multinational organizations saying, “Here’s what we need to do in order to achieve our strategic goals.”

Like many things in business, reinventing customer relationships is much easier said than done. Based on what they learned in their survey, IBM recommends three specific strategies:

1. Make customers your #1 priority.

Every employee in the company needs to be responsible for customer satisfaction. Not just those who work directly with the customer, but every employee.

Make it easy for customers to do business with you. This requires giving employees the information and authority to solve customer problems without a lot of red tape. Measure all employees on a customer satisfaction metric. And most important, make sure you know (don’t guess) what customers value and what motivates them to buy your product or service.

2. Use two-way communication to strengthen relationships.

The old days of sending out a customer satisfaction survey once a year are long gone.

Make customers part of your team. Find new ways to communicate (i.e. social media) and new ways to evaluate and leverage what they tell you.

Get customers involved in your R&D or new product development efforts. Involve your customers before and beyond the sale, including care and service. Make doing business with you as transparent as possible. Ask customers how you can make it easier for them to do business with you.

3. Turn customer data into customer information.

Develop new ways of gathering, analyzing and using the information customers provide about how you can help solve their problems and achieve their goals. Make sure this information gets to everyone in your organization who needs it.

These strategies seem right on target. But I would strongly recommend one critical action step before implementing any new customer relationship initiatives – unlearning what you think you already know about customer relationships.

Our assumptions, beliefs and “thought bubbles” about the way things work are so deeply ingrained that we often don’t realize how strongly they affect our thinking and decision-making processes. Until we identify and discard outdated ideas, attitudes and assumptions about customer relationships, any efforts to move forward with new approaches will feel like walking up a down escalator. Reinventing customer relationships starts with challenging everything we think we know about them.

This involves asking questions like: When was the last time we thoroughly reviewed our customer relationships? What has changed in our world since then? What has changed in our customers’ world since then? What assumptions are we making about our customers that may no longer be true? What assumptions are we making about how to deliver value to our customers that no longer may be true?

These questions help people to break away from the attitudes and assumptions that keep them stuck in the past. The following exercise encourages people to start looking ahead and thinking in new and different ways:

Imagine that you’re starting the company over from scratch, so for the moment put aside everything you know about running your business. Imagine also that you have no constraints or resource limitations. With that in mind, ask the following questions:

  • How would we go about defining customer wants and needs?
  • How would we serve this market differently?
  • What new technologies would we use to communicate with customers?
  • How would we organize internally to better serve our customers?
  • What things that “have always been done this way” would we do differently and why?
  • If we could solve one customer problem that would put us so far ahead of the competition that they could never catch up, what would it be?

Obviously, no company has the luxury of unlimited resources. So not every idea you come up with will have practical application. But the goal is to jolt people out of their customary ways of thinking so they can begin the process of reinventing customer relationships without the burden of potentially outdated thought processes. So first get very clear on what you are currently thinking. Then define what your new customer relationships need to look like. Then get to work on reinventing them.

One final finding from the IBM survey: organizations that excel at extracting previously undiscovered insights from vast amounts of customer information will enjoy a huge advantage in deepening existing connections and creating new relationships. So if you believe (as 1500 CEOs around the globe do) that customer relationships represent a key component to strategic success, it ultimately comes down to three critical tasks:

  • Engaging your customers in new ways to increase loyalty and generate new demand and revenue sources.
  • Getting customers more involved in your product and service development processes.
  • Learning how to turn customer data into information and using it to empower employees to deliver more value to your customers.

As the survey indicated, today’s customers aren’t asking to be treated differently. They’re demanding it. How are you reinventing yourself and your business to meet that demand?

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