Breaking the (conventional) rules – Delighting Customers
February 20, 2011
— capitalism, customer, delighting customers, denning, differentiation, innovation, IT sales, selling
These, and many others like them, are all great marketing phrases to entice customers into feeling like they are cared for. But are they really?
A couple of great articles that Jim Hays shared with me this week from Steve Denning (“The alternative to Top-down is Outside-in” and here) really drive home this point. Denning also points to The Age of Customer Capitalism HBR article. An article that I read last year and is a powerful thought provoking article that I would strong encourage reading. (found here)
This got me thinking, in the technology sales industry how do we really put the customer first? How do we shift from a “shareholder value” focus (“push” more of our products and services”), to a delighting the customer approach that means customers will seek out our products and services.
Part of the challenge is fear.
History tells us that buyers (IT and Procurement) go to great lengths to keep us (sellers) squarely in our place in the value chain. They expect us to jump through all the hoops (increasing the cost of sale) in their attempt to de-risk their decision on how they buy from
Note – not WHAT they buy, but WHO they buy from, as in most cases they know what it is they want to buy, they are simply now going through a tried and tested approach of getting the best bang for their buck. Commoditising our offerings.
So for all of us that sell in the industry, how? When we do not have the chance to “add value”, when we are treated as “suppliers” in a commodity environment, when our products and services are considered the same as, or near enough the same as, our competitors do we delight the customer…and do all this without eroding margins in an already tightly contested space?
The fear is that if we do something different the result will be worse, and in doing so we will risk our companies and our own personal future. So we keep selling the same way, with lower close rates and lower margins.
But without risk there is no reward.
Conventional management wisdom (as described in the linked articles above) describes management culture focused on shareholder value. Our customers live this culture. Their shareholders will benefit if they can sell more of their product while reducing their overall expenses to make, sell and support those products. Some people in the organisation are focused on the sales side, some of the make side, some on the support side and then more on the admin / overhead side (like IT). It’s an interesting pyramid that when balanced out there is often more people (as a % of employees) focused on the cost control side of the shareholder value equation. This is in part as management doctrine says aggressively optimise the business while increasing revenue (innovation falls into that but innovation as a % of revenue generating activity is usually very very small – cash cows get the most resources).
So if the “traditional” (IT) buyers in our customers today are focused on cost control, why aren’t they delighted. The technology industry has it’s strength and reputation in helping companies to save billions,if not trillions of dollars over the past 20-30 and into the next 20-30 years. Yet are our customers happy? Are they delighted to a point they see our companies not as suppliers but as genuine trusted partners?
No, optimisation is a given – it’s table stakes.
So how do we truly delight them? In short the answer is simple. Help them overcome their frustrations, make their jobs easier, make their contribution to their companies goals more tangible and achievable. But we can’t do this “at any cost”.
Two weeks ago in our blog we introduced BOLD as a model for differentiation, not just in the sales cycle but in genuinely helping customers achieve their desired business outcomes. It’s this type of bold strategy to go beyond the PO and help customers through supporting adoption of new technology that changes the rules. Sure adoption is the customers responsibility, not ours, but if they don’t adopt they don’t get value, no value, no repeat sale and we are commodotised.
Breaking the rules means doing things that others aren’t, it’s about moving beyond the short term “close the sale” focus and looking at the longer term customer relationship. No “wham bam” PO and move on to the next.
Zappos encourages staff to take as long as they need on the phone with a customer. Their philosophy is that we have 5-10 mins of uninterrupted time with a customer, why “rush them off the phone” in the name of call handling times and cost per call.
Proctor and Gamble tied CEO A.G Lafley’s bonus to the companies performance as much as 10 years post his tenure as CEO, meaning he needed to create long term sustainable growth capability that ensured the company would be successful for up to a decade post him leaving. rather than creating short term immediately rewarded bonuses.
The technology industry needs to break the shackles, pushing our products to IT isn’t going to work anymore. In “the age of customer capitalism” it’s the companies that take delighting customers to another level that will be successful.