Feature

The customer is always right... really?

In a previous article, I looked at suppliers from the point of view of the customer, the CIO. Now it's time to do it the other way round.

Let's start with the idea of customers from heaven and from hell.

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From the supplier's point of view, there are two extremes of customers from heaven. One type knows what they want and understands that a good customer-supplier relationship is worth its weight in gold. They are prepared to pay for value. They may benchmark your costs, but they don't put everything out to tender so other suppliers get a chance to tread on your territory.

If there is a problem in the relationship, whether it concerns a particular solution you have provided or your failure to manage some, or all, aspects of the relationship professionally, they voice it quickly so you can rectify the situation. Periodically, they review their relationship with you. However, if they intend to go and see what other suppliers have to offer, they give you due notice.

An open chequebook

At the other extreme – but still a heavenly one – is the customer that has no idea what they want in terms of IT and doesn't want to get involved in lots of detailed purchasing decisions. They expect you to manage everything. This sounds chaotic, but it isn't. Their view is that their job is to run their business, while your job is to sort out their IT.

Their chequebook is open, but they make it clear that you will be assessed for your contribution to the success of their business, by supporting their strategic moves and keeping their operations smart, smooth and efficient. Fail in that, and you will be out.

Between these two extremes are most of the customers from heaven. They rely on your expertise in some areas, and on their own in others. They just expect you to provide the solution to meet their defined needs, although they will be open to suggestion as to whether their view on their needs is correct.

Customers from hell

Now let's look at customers from hell – the polar opposites of customers from heaven. At one extreme are customers who think they know what they want, but their judgement is not good. This may be because the CIO is poorly connected with the business, and forms a view of what is needed without proper and deep consultation with senior functional colleagues. You may not know this and will discover it only when you begin your first projects. Then you will be faced with challenges from senior users, not only about how the project is being run, but also about why the project is there in the first place.

Such senior managers are likely to be far removed from the daily lives of the people who work for them

Another problem might be that the CIO really does know what the business needs are, but senior functional colleagues don't understand what they need to support their activities. They underestimate, or overestimate, what information systems can do for them. They may not even know what information systems do for them at present or how well they function. 

Such senior managers are likely to be far removed from the daily lives of the people who work for them, whether they be other managers or front-line staff who deal with the day-to-day running of their functions, such as HR, logistics, purchasing, sales, customer service or accounts.

Troubled projects

There is at least one other dimension of hell. This is the client, whether originally from heaven or hell, who has fallen victim (or believes they have) to sharp practice by another supplier, which led to a "troubled project". As a result, the client's staff may have become very cynical about all suppliers and will co-operate poorly with any future suppliers. 

The CIO may even be bullish about what has happened, blaming it squarely on the supplier, even though it may be partly a result of his or her mismanagement, whether in appointing the supplier or in how projects were managed.

Identifying customer types

How can you avoid such a situation? The key requirement is to know the nature of the beast you are dealing with, just as clients need to, as suggested in my first article in this series.

Why? Because it is bad news if you mistake one customer type for another. The type of customer has a big effect on the probability of you being able to deliver your projects on time and/or on budget. Ideally, you should know the truth before you sign any contract. How can you do this?

The type of customer has a big effect on the probability of you being able to deliver your projects on time and/or on budget

One way to minimise your chances of being caught in the wrong situation is to train your people whose job it is to manage customers before the sales – sales and pre-sales support – about these matters. They need to gather the facts to indicate what type of client you are dealing with. This means giving them the question sets, not just to diagnose the basic information systems requirement, but also to diagnose how well information systems policy is developed and implemented. If the likely contract is very large, then your senior management need to be fully involved in this diagnostic work.

Warning signs

What if the client doesn't co-operate? This is a serious issue. If a client refuses to allow you to ask questions about how they develop and implement their information systems policy, how they diagnose requirements, how they work with their information systems and functional users and how they work with their suppliers, this is a warning sign.

Of course, you need to watch your own behaviour. If you are so desperate to sell that you decide not to investigate these issues, then you will only have yourself to blame if you end up producing a troubled project, news of which will travel round the market. One supplier I knew well told me it refused to bid for large projects where the previous supplier had messed things up badly.

That was because, in such situations, the project was almost certain to end up being troubled, whether because the previous supplier had badly oversold, leading to inflated expectations about what could be done and subsequent disappointment, or because the motivation and understanding of the information systems and functional staff were so damaged by the project that they had become impossible to work with, regardless of your own professionalism.

Maintaining a good relationship

If all goes go well, you should end up with a marriage made in heaven, because you will identify clearly how you need to manage a customer and attune your propositions and relationship management to the customer's needs and characteristics. But too many client-supplier marriages made in heaven end in bitter wrangling and divorce. So how can you ensure the relationship stays good? The best approach is straightforward but rarely implemented fully in practice – use a proper account management process.

But doesn't everyone do that? Well, everyone says they do it, and some do it very well. But there is often a yawning gap between theory and practice. One problem is the theory. 

Too many client-supplier marriages made in heaven end in bitter wrangling and divorce

Take communication between supplier and client. In today's world, it is not as easy as the account management theory suggests to stay in touch with all the client's decision-makers, influencers, users and others on whom the success of your projects depends, and to manage their expectations and requirements. There are simply too many people to keep in touch with.

Make communication easy

However, you can make it easy for a client's staff to keep in touch with you when they need to or when they want to discuss a problem or an opportunity. You can use groupware to do this, or simply make it clear to contacts what is the best way to reach you and how quickly they can expect a response and resolution of any issues. 

This is hard when you are a large business, and when no matter how good any one member of your staff may be at managing clients, they rely on their colleagues, who may not be quite as good. Of course, a customer from heaven understands all this, and develops ways or working that are feasible for both parties.

What customers really think

Most suppliers think they are better at account management than they really are. That is why I recommend a health check every now and then. If only more companies would do this honestly and not believe their own publicity about how good they are at account management, then I wouldn't keep hearing stories from clients about company X or company Y. Here are some examples of what I have heard in the past month:

"We only hear from them when they want to talk to us."

"They are only interested in the money."

"We have no idea of their strategic direction, and whether it matches ours."

"I don't even think they know how much business they do with us."

"They are worried that the cloud will undermine their business with us, so they are trying to maximise short-term sales."

I would like to believe I will hear this kind of thing less often in the future, but I'm not convinced. Perhaps customers and suppliers from hell will continue to find each other. Let's hope those from heaven continue to do likewise, and educate the rest of the world.


Merlin Stone is an experienced manager, consultant and academic who has advised many systems suppliers and clients


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This was first published in June 2014

 

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