loy*al*ty n., the act of binding yourself (intellectually or emotionally) to a course of action.
Does loyalty matter in IT relationships? It sure does, in a big, profitable way. Clients gain a competitive edge and loyalty leaders earn 12 percent higher profit margins compared to the industry average. (Source: walkerinfo.com loyalty research experts.)
How can you employ tools and processes to benefit from building loyalty? This series, "Substance, Not Sizzle, Earns Customer Loyalty," will reveal which IT vendor practices clients value and showcase IT leaders' strategies to meet customer needs, differentiate services, earn richer margins and maintain a competitive advantage. Assess and incorporate new tools in your processes.
For all the hype about investing in new customer relationship and loyalty tools, my study of senior IT managers shows that vendors earn trust, credibility or a positive relationship by consistent delivery of good judgment, deep collaboration and sustained competent execution.
Prominent IT customers gave high ratings to the following six success factors. Over the next few months in this series, IT vendors will describe how they match customer needs.
1. Minimize Turnover to Preserve Communications and Improve Accountability
"Working with the same team preserves communications and holds them accountable for business results. Better decisions are made in less time." - Director of Business Intelligence
Customers place high value on a solid communications link across the multilevel hierarchical vendor team. When vendor staff turnover is low, the same resources retain knowledge and history. During implementation, alternatives and dynamics don't need to be revisited, saving time in making the right choices.
Performance expectations vary by job function: sales, technical and executive. The sales team is expected to remain intact through the completion of the project. Technical contacts are critical to success. Customers want a guarantee that pre-sale skill level is also available post-sale, and the role includes not just problem solving, but it stretches across continuous quality improvement. Executive sponsorship can influence timely execution of expectations set by sales and technical experts, and support teams. The sizzle, the executive-to-executive relationship, holds little value. Enabling resources for operational excellence earns equity.
How would stability of competent resources impact your costs, schedule and performance?
2. Share IT's Intense Focus on Solving Customer Problems
"Every instance where IT provides input to business teams is an opportunity to either build trust or to lose credibility." - Senior IT Project Manager
IT performance is mission-critical; it can tolerate distractions. Rapid deployment of enhancements amounts to deflecting competitive threats, forging a competitive edge. Any interaction that does not improve the efficiency is a cost neither IT nor vendors can afford.
IT teams represent the vision to deliver business results. They calibrate needs and match new tools. They estimate scope of work, schedule, skills and adoption path. The better informed they are to articulate a solution's capabilities, the better their ability to contribute.
Vendors must earn credibility on a consistent performance track-record of substantive value delivery: validate needs, profile systems environment, define specifications, match deliverables, determine priorities - size resources, costs, schedule and ROI. Collaborate in risk assessment and mitigation plans. Understand and work with the team's project and vendor management process. Credibility is built with a track record of performance and teamwork.
3. Collaborate Across Multivendor Teams
"We expect vendors to work across the 11 other IT partners we have in our environment." - Senior MIS Manager
Collaboration in IT projects requires commitment to a multidimensional framework. Vendors need to be integrated into the client environment. Clients have 8 to 10 software providers operating on different hardware platforms connected via a variety of options. The vendor teams need to demonstrate that they share clients' goals and are equally committed to achieving business results for both task focus and day-to-day operations.
One critical task clients face is deploying upgrades. It includes testing integration robustness with their multivendor environment and skills to support it. That the product delivers functionality is expected but irrelevant -- what's valuable is how it integrates in the unique customer environment. Upgrades are necessary and a major time and resource commitment. Expectation setting must reflect the shared technical maturity assessment of the collective client/vendor teams.
Day-to-day IT performance tuning is roughly comparable to daily greasing of machinery and clearing away scrap from production facilities. It includes preventative operations and performance measures: review of user logs, securing data volumes, retesting security routines, examining network bottlenecks, enabling target query performance, scrutinizing reject/error logs. What matters is the efficiency of the entire system. Who makes which component no longer matters. Everything must be fine-tuned to work together smoothly.
4. Employ R&D to Build Strategic Advantage
"We need our technology partners to have skin in the game. They can show value by investing in R&D and developing features we need." - IT Director
In the spirit of creating a strategic advantage, clients expect technology partners to employ R&D without advance payment. Clients invest by providing requirements, committing team resources for development, supporting testing and helping fine-tune the solution. Often they go the extra mile - serving as a reference, participating in vendor events and allowing on-site customer visits and team conversations.
This continuous-improvement collaboration delivers innovative solutions and competitive advantage for clients and vendors.
Are you exploring such customized collaborative initiatives?
5. Optimize Multitrack Communication Channels
"Today, we employ a variety of strategies to work with our IT partners." - IT Manager
At all levels, project managers use a problem-management process to catalogue and resolve problems. A weekly or twice a month vendor conference call tracks progress and resolution. Often, this establishes a very tight connection directly to the developers in the lab. Problems are visible to the right engineers. The call has an impact on morale in addition to business results. They are aware of resolution plans and schedule.
At level I, the day-to-day integrated operations and problem-solving team forges a unique identity. Even though multiple vendors are represented, this team functions as a single unit. Tackling high priority and tactical problems, it often serves as an early warning system and is a critical source for future enhancements.
At level II, longer-term problems are tracked by the team. Here, all vendors and program teams integrate tactical choices into a system that can provide superior support to users.
At the next level of communication are formally scheduled vendor meetings or summits. Typically, these are held once or twice a year. The meetings are two to three days packed with eight to 15 sessions on vendor technology, vision and demos, as well as current needs. Participants include client IT staff and operations teams (and other vendor representatives), as well as the vendor's assigned executive, technology experts and support team. The agenda has been carefully drafted and circulated well in advance. These meetings can set a very positive the tone for the year.
"When all business processes are working smoothly and we have plans to fix problems, vendor interaction at lunch or a dinner meeting is very rewarding for both teams. There is not much scope for socializing if the systems are not performing well." - DW Director
How well are your systems working at each level?
6. Leverage Executive Communications, a Powerful Tool
High-level contacts on the executive and technical teams are a very powerful tool, but only when the underpinning is the substance of delivering commitments the vendor's operational team has made.
"When the vendor's president or V.P. of development sits across the evening dinner meeting and confirms that their resources and work process match our priorities, it is good to know that they are making the required investments." - IT Executive
How effectively are you leveraging your vendor executives?
With intense focus on delivering client success, client and vendor team lines are blurring. Develop a clear vision of your needs and seek collaboration. You may be surprised by your IT partners' positive response.
Register or login for access to this item and much more
All Information Management content is archived after seven days.
Community members receive:
- All recent and archived articles
- Conference offers and updates
- A full menu of enewsletter options
- Web seminars, white papers, ebooks
Already have an account? Log In
Don't have an account? Register for Free Unlimited Access