The traditional business model of separated teams, or silos, for marketing, sales, development and support simply is no longer working for B2B companies. This business model is prone to a waste in resources, duplication of efforts and poor internal communication. On the other hand, a product focused business model can lead to not recognizing opportunities for additional sales opportunities to an existing customer base. So what is the alternative? To borrow and adapt a quote from the 90’s – it’s about the customer stupid. Though these independent functions are still necessary, the best organization is to align business operations and teams with a focus on a customer segment.
The idea is not totally new. I’ve worked in this situation for years when working on key multi-million dollar accounts. Even though everyone in the customer team actually had reporting line responsibility (and bonus structure) reporting into a function, we worked as a team to service the customer. These customers also had unique processes for delivery and support of multiple products. What is a bit different is to apply this type of “platinum” service to all your customers.
So what are some key success factors to consider when using a customer orientated approach?
Segment depending on what is of value to the customer segment
When deciding on how to divide customers into groups, the criteria that used needs to depend on what is important for the customers. This means building a customer profile that is informed by the customer’s use of the product, how they like to buy and how they like to engage with the company. In the end the individual segments may appear to be like the standard categories in the past. What is different, we aren’t picking one and using it to measure everyone.
As an example, a company that sells accounting products may have a customer segment that represents customers from Japan and a segment for small business. Japanese consumers like to buy locally, so it may be important to offer localized channels to deal directly with Japanese customers. Another customer segment may be small business because they would have a specific needs for add-ons to the product. It doesn’t mean that the company doesn’t have small business customers in Japan.
Design the business process flow for the customer
With the customer profile in mind, the business process flows should be designed for that customer segment. Do they like buying online or prefer to speak to someone in person? Are there other products of use to the customer? The customer’s engagement with the company should be then tailored to these preferences. When a customer contacts the company they should be able to navigate easily through your flow to find what they need. Not be bounced around from person to person who says – that’s not my job, I’ll transfer you.
With this in mind it should be easier to add in products to a layer. If there is a new product of interest to this customer, then it just folds in using the existing operational framework in place. Rather than having to build a new unit for delivery. The new product layers onto the existing customer offerings.
Build your internal systems and tools around the customer
Customer data needs to be easily available to everyone that has contact with the customer. A good CRM system can provide information to field staff. One example of this not working is in the CIO community, where some of the large platform companies which huge portfolios have sales people separately contact the customer independently to sell different products. There should be a cohesive whole view of the customer. I’ve even heard of companies having to deal with it taking months to load contracts into their systems, resulting in preferred customers not being recognized when they first place a support call. Using modern tools and building out an accessible platform of information about the customer is critical
Have customer facing roles that don’t sit in functions.
These people will act as glue between the traditional functional roles, as they engage and interact across the organization and have direct interaction with the customer. It may still make sense to have departmental groupings for functions, to gain efficiencies due to size and share of specific functional knowledge. What I would like to suggest is that there is a need for some independent roles that don’t traditionally sit in a function. An example, one new popular role is the customer engagement manager. This person is the advocate and point of contact for the customer, and doesn’t really sit in sales or support. Product Marketing is another traditional role that actually doesn’t have to fit in one
Adapt your financial reporting to the layer
Traditionally companies do their P&L reporting by the traditional business units, and consider supporting functions such as marketing, finance and development to be overheads. And even go as far to do internal inter-departmental charge backs to move costs between business units. Financial systems should be setup to report the true worth of an individual customer unit – including revenue, cost of sales, cost of marketing, and cost of support that can be attributed to that customer. By creating reporting that can do this, then we have business information to decide if the costs in place are profitable or if budgets should be adjusted.
