In business-to-business markets, the key element of the customer relationship can be defined as how much strategic value your products and services add to a client’s business. Yet “strategic-value-added” is one of the most difficult things to measure and nearly impossible to gauge using third-party customer surveys. The best way to understand how clients perceive value you provide, and identify opportunities to improve your business, is to skip the customer satisfaction surveys and opt, instead, for collaborative conversations with decision-makers at key accounts.
Our client, A Washington, D.C., technology services firm—”Washco”—wanted to grow existing strategic customers and attract new ones. Washco was seeking profitable long-term relationships in which it could concretely contribute to its customers’ success.
With this goal, Washco’s executives sought to understand what would or would not motivate customers to buy. They identified four key questions:
- What are we doing that works well, and how can we do more of it?
- What are we doing that is not working, and how can we improve those activities?
- What should we stop doing because it provides no value to our customers?
- How much strategic value do our customers think we are providing, and how can further contribute to their success?
Washco commissioned a customer survey, which provided broad statistics on such topics as Washco executive interaction; understanding of the customer’s mission and how well Washco served it; and the ease of interaction with Washco across all areas.
The survey showed that Washco’s customers were generally “satisfied”; it also revealed that customers were “somewhat unsatisfied” with problem resolution. More troubling, the survey results did not provide any insight into why customers were unsatisfied. In Washco’s complex custom solution business, the problem could have stemmed from a number of areas. Were the issues in time to acknowledgement, time to resolution, resolution quality, executive involvement, problem ownership, the impact on customer business, a combination of elements or something Washco executives hadn’t thought of?
‘The company created a solution to its customers’ problem that no other vendor was currently addressing.’
While the survey could have been redesigned to include all possible touch-points in the problem resolution process, Washco executives realized that static survey responses would not capture the nuances of the interplay of factors that were frustrating customers. They concluded that only face-to-face discussions with customers would give them the necessary actionable intelligence improve their business processes.
With our help, Washco developed a structured interview designed around their four questions, then sat down with executives at each strategic account for a collaborative meeting.
Help us help you
The Washco team started each meeting by presenting to client executives specifically what Washco was doing to help them reach their goals. Next, team members asked the clients for feedback, saying to each customer, “This is what we think we do to help you achieve your goals and what we want to do to help you more in the future. Help us understand where you agree and why and where you disagree and why. Help us focus our resources on maximizing our value to you.”
Washco’s customers appreciated the “everything is on the table” approach and the opportunity to brainstorm new products, services and business processes with their vendor. Customers not only enthusiastically offered frank appraisals of Washco’s efforts but also volunteered some of their strategic objectives and in-house issues, asking Washco for their help in achieving their goals.
Customers expressed concern over the delays of both Washco and their competitors in finding personnel with specialty skills such as Oracle knowledge. Washco pointed out that the customers were unwilling to bear the cost of keeping such talent on the bench. Washco determined that its best alternative was to develop internal and external third-party rapid recruiting and hiring teams that would keep tabs on talent to pursue at a moment’s notice. The company created a solution to its customers’ problem that no other vendor was currently addressing. In return, customers acknowledged the challenge that Washco faced and agreed to give Washco more notice when they needed specialty skills.
In highly competitive markets, the decision to buy or keep buying from one company over another is based on whether or not the customer sees the vendor as a source of strategic value. Everything a vendor does affects the buying decision. Sales, order entry, delivery, legal, accounting, customer service and support all impact how customers feel about doing business with you. Over the long run, a company that keeps strategic customers and attracts new ones must integrate all business functions around providing value to clients.
Tear down department boundaries, eliminate unnecessary activities and focus your energy on doing things that serve customers well. This is a significant undertaking that affects your entire. Before making changes, know exactly what customers perceive as value. The best way to understand how customers value your activities is to ask them directly.
A custom questionnaire will help you get at the heart of what needs to be done within your company to add customer value. Start by answering the questionnaire yourself, having key company leaders pretend to be clients. Then imagine how clients might answer the questions regarding your major competitor. Finally, sit down and review the questions with at least one trusted client executive.
Don’t miss this opportunity to use your time with the customer to delve into the issues behind the answers. Follow Washco’s example. This is an opportunity to collaborate with clients to create innovative solutions that differentiate your business in the marketplace. In this age of technological applications, sometimes simply sitting down with people face to face can tell you more about what customers think.
The better you understand the nuances of how to best serve key accounts and add value, the more likely you are reduce price competition and keep competition out.
