10 Nov 2008  What Do YOU Think?

How Much Can You Ask of Your Customers?

Think of IKEA and eBay. Some popular companies make it easy for customers to become "volunteers" in the organization's success, says HBS professor Jim Heskett. Is there a downside? Or will customer-fueled strategies provide competitive advantage in the future? Online forum now closed.

 

Summing Up

Is customer volunteerism combined with "ownership" a double-edged sword? It's seems okay to involve customers in providing ideas for new products and processes. Encourage them to refer new business. But beware the downside of poorly thought-out strategies to encourage customer volunteerism and "ownership." Those were messages in the very thoughtful responses to this month's column.

Dianne Jacobs commented, "This builds on the real social need for people to connect in sync with a purpose." Charlie Cullinane added, "I believe we can ask a lot of our customers if we give something back, even if that something is a sense of belonging … just look at this forum … to see it in action." As Jacoline Loewen put it, "Even if a company does not want customers involved in their business design and delivery, it will happen." Commenting on the need to bring trouble-shooting forums in house, Ruediger Voelske said, "Innovations and strategies can then be developed from forum experience."

Others offered examples of interesting applications of the idea of involving customers in fashioning products and services. These included the National Geographic Genographic project (Inga Ness), Trendwatcher (Gerald Nanninga), and Wikipedia (Adnan Younis Lodhi and Sameer Kamat).

In spite of the advantages of putting customers to work, a number of cautions were raised as well. Bruce Dancil warned, "Some of the ugliest cases of over-involvement (of) customers have led to bitter intellectual property right disputes … customers simultaneously trying to drive the product in two (or more) very separate market directions … (or) feature creep that literally prevents on-time, on-budget delivery." Heinjith Balakrishnan commented, "… the biggest challenges for … organizations are to have the necessary competencies and resources to act upon … inputs." Sowmia Gopinathan echoed this comment: " … (the) downside is only where expectations of the customers are made high by involvement and … (are) not met due to resource constraints." M. J. Fleming cautioned, "If you (as a customer) have influence, you can lead in a horrible direction … We should all be very careful of what we wish."

To avoid these predicaments, Neil Jackson recommended, "Before we encourage too much, the risk surrounding what it is we are encouraging, how and when we set overall rules for encouraging (volunteerism) and how we plan to assess, monitor, and manage need to (be) addressed." Alden Cushman added: "how information is collected, put into context, prioritized, and impacts business decisions is key."

Other comments raised questions for us to think about. As Jill Malleck said, "Many (customers) … do not want to be artificially attached to a company … Organizations would do well to pay more attention to their employees." Mark Bright asked, "Can we have too much "customer" in the process?" And Gerald Nanninga posed the interesting question: "Have we limited our potential by not only mislabeling potential partners as 'customers' but in mislabeling everyone in the entire supply chain?" What do you think?

Original Article

The Internet and related technology has freed customers to express their feelings, exchange information, and act in ways that previously were unheard of. Several recent writings suggest that the next phase in the activation of customers will be putting them to work in the service of an organization. Characteristic of this thinking is an article in the October issue of the Harvard Business Review by Scott Cook, Co-Founder and Chair of the Executive Committee of Intuit.

Cook argues that a number of successful organizations have gotten that way by making it easy for "volunteers" to contribute to their success. Business models are designed so that volunteers (often customers, but also others) can easily contribute content (opinions and ratings for Zagat guides), "stuff for sale" (eBay online marketplace), behavioral data (Google's search engine algorithm), and even resources (Skype's Internet-based phone system). What is contributed benefits other users (as, for example, when a network is enlarged) as well the organization itself (providing lower costs, greater resources at little cost, better customer service, more effective marketing, increased employee engagement, and better design).

Research reported in a book, The Ownership Quotient, that three of us recently co-authored suggests that the benefits of customer contributions are significant. Further, an organization's best customers—measured in terms such as size, loyalty, or lifetime value—often are the most willing to go to work for it, whether that means referrals of new customers, ideas for new products or processes, or even help in the selection of its frontline employees. Of greater significance than satisfaction or even the willingness to recommend the organization to others, these "ownership" behaviors can make some customers more than a hundred times more valuable than others.

Just how far can ownership be taken? What's its downside? Those are questions explored by Pete Blackshaw, the incoming Chair of the Better Business Bureau, in his new book, Satisfied Customers Tell Three Friends, Angry Customers Tell 3,000. The title is a play on the standard pre-Internet belief, based on the results of only one research study that became a mantra, that satisfied customers tell five others but dissatisfied customers tell ten. Blackshaw's experience with consumer-generated media suggests that consumers today can be a major force in making or breaking a product or service. But they have to be given the latitude and freedom to do so, involving a risk that few organizations are willing to take.

Note that the term "marketing" has not appeared thus far. Our work suggests that customer and employee "ownership" has as much relevance for operations and human resources as it does for marketing. Blackshaw argues that organizations that regard their web sites as marketing devices run the risk of destroying the credibility of information presented there, thereby losing their effectiveness with potential "volunteers" and "owners." It requires that marketers, as Blackshaw puts it, work in an "atmosphere of complete honesty," something sometimes difficult for them to do.

These phenomena raise interesting questions. Just how much risk do organizations with well-established names, policies, and processes take in encouraging volunteerism and ownership on the part of customers? How can the risk be mitigated? Are customers being underutilized by the typical enterprise? Going forward, will customer-fueled strategies provide significant competitive advantage? How much can you ask of your customers? What do you think?

To read more:

Pete Blackshaw, Satisfied Customers Tell Three Friends, Angry Customers Tell 3,000: Running a Business in Today's Consumer-Driven World (New York: Doubleday, 2008).

Scott Cook, "The Contribution Revolution: Letting Volunteers Build Your Business," Harvard Business Review, October 2008, pp. 60-69.

James L. Heskett, W. Earl Sasser, Jr., and Joe Wheeler, The Ownership Quotient: Putting the Service Profit Chain to Work for Unbeatable Competitive Advantage (Boston: Harvard Business Press, 2008).

Comments

    • Neil Jackson
    • CEO, JAT Risk Solutions

    Very interesting debate now and into the future. Risk must include an assessment of how the volunteer will view their contribution relative to its potential for revenue and their potential perception of volunteer ownership reward share. The risk assessment should follow the processes defining how volunteer ideas move into products and services. Defining the rules clear and upfront needs to be done.

    Before we encourage too much, the risk surrounding what it is we are encouraging, how and when we set overall rules for encouraging and how we plan to assess, monitor and manage need to addressed. Volunteerism with and without a subsequent exchange of value needs definition, impact assessment and policy enactment before risk mitigation and effective governing can take place. These steps will tell both when you want a customer to become a volunteer and to what degree a customer will. We suggest knowledge/awareness is the first and greatest step to risk mitigation.

     
     
     
    • CJ Cullinane

    I believe we can ask a lot of our customers if we give something back, even if that something is a sense of belonging. From honest feedback to ideas for products, customers can give an organization fresh input and a different viewpoint. I think of the SETI/Government space projects where thousands of people got involved in listening for and processing information on their computers during off hours.

    I believe this can be a powerful tool for companies but they must do it correctly. By this I mean do not overdo it, don't become SPAM. Give something back, even if it is just feedback of what happened.

    If you would like to see this process in action just look at this forum, Working Knowledge, to see it in action. A high profile audience responding to intellectual questions and getting feedback and recognition in return (the reward).

    Do I think it works? Yes, I respond every month and appreciate the opportunity to do just that.

    Charlie Cullinane

     
     
     
    • Bruce R. Duncil
    • Alderon Consulting, Inc.

    Research you've cited showing that customer loyalty can drive brand just as customer input can feed critical innovation is certainly consistent with broad industry experience. Ultimately products must satisfy customer needs and solve customer problems. But yes, customer ownership of a product developer's process and its result can be taken too far with sometimes catastrophic outcomes.

    Some of the ugliest cases of over-involvement have led to bitter intellectual property right disputes between product developers and their customers. In other cases, development teams have become paralyzed by two (or more) customers simultaneously trying to drive the product in two (or more) very separate market directions. In still other cases, customers induce feature creep that literally prevents on-time, on-budget delivery. Creep has sometimes even caused product over-specialization that ultimately resulted in loss of overall market share and profitability. Many product developers have discovered that they do not have the internal capability to successfully manage separate core and customer product lines.

    In today's rapidly changing global markets, it is becoming more common for customers to be increasingly out of touch with their true needs - or even have a thorough understanding of the problems they are attempting to solve. In those cases, developers must play the role of becoming the experts, "owning" the customers process and results. In some instances, the customer's own success may ultimately rest on their ability to put their trusted suppliers to work and make contributions in their organization.

    And of equal interest, some companies have recently begun to discover that their success can be driven even further by engaging and capturing the contribution from their non-customers.

     
     
     
    • Adnan Younis Lodhi
    • Section Officer, Ministry of Commerce, Pakistan

    The mass usage of Information and Communication Technologies (ICT's) has changed the way Individual(s) act in our society. The era of passiveness is over forever. Access to information in empowering. But access to information and means to employ & deploy that information could be energizing and intoxicating.

    In this decade, we have seen the rise of Wikipedia, user driven encylopedia. It has shown how many willing minds are out there to be tapped for free. This is a geat opportunity not to be missed to your competitor.

    The interactive consumer is a package deal. Its advantages are obvious. From better product quality, process and compliance with labour, health and environment standards to fair competition.

    In the zeal, we must not under-estimate the downside of over-intrusion.

    Generally, the avtivist owners tend to be more puritan and idealist and miles away from the actual constraints of doing busiess in competetive world. Companies can as easily lose thier goodwill as they earn them if not fullfilling their recommendations. Losing goodwill of such customers is disaser as they are armed with the latest weaponary of Information age.

    Moreover, the company can easily overwhelmed by the pressure of activist consumer who may not represent the majority.

    This models also challenge the standardized production model benefits of big companies that derive brand premium from quality assurance through their name.

    To mitigate downsides, companies have to create ways and means to filter positive contribution from the push of the idealized.

     
     
     
    • Dianne Jacobs
    • Founding Principal, The Talent Advisors (Melbourne, Australia)

    We are as much in the age of collaboration as we are in the age of information.

    Collaboration within organization structures and with external stakeholders (such as suppliers, customers, other businesses, governments and nonprofits) is a response to situations that are becoming more complex, difficult or ambiguous. Knowledge, power and the capacity to execute often no longer resides with one leader, one company or one alliance partner. It also requires a capacity to work with opposing concepts such as competing while co-operating.

    Companies that excel at collaborating, internally and externally, will take the lead. Collaboration forges interdependent and sustained links. The ante is that stakeholder collaboration must deliver truly improved business performance and an enhanced value proposition for the participants.

    Client-centric models where companies listen to and engage with their customers are not new. Shared client interaction and problem solving has always been a source of competitive advantage. This new volunteer and ownership model is extending and testing these boundaries. Clients are willing participants in this phenomenon as it enables them to achieve their objectives more effectively than in the past.

    For these clients there may be deeper drivers in play. When people are involved in creative work there is a greater sense of personal satisfaction. Creativity is a source of meaning in people's lives and most of the things that are interesting, important and human are the results of creativity. This builds on the real social need for people to connect in sync with a purpose.

     
     
     
    • Sameer Kamat

    Wikipedia is another example of how volunteerism has been taken to a whole new level where volunteers/customers are not just embedded in a supporting role, but actually help build the product.

    Some of the factors that may have a significant influence on whether such an approach will be successful are:

    Product Need: Whether the product (or service) fills a genuine gap in the market by addressing issues that customers can directly relate to, will decide if they see real value in it. The need to communicate (cheaply) falls in this realm. If I can communicate across continents at a fraction of the cost, that option would surely get my attention. However that factor alone cannot guarantee success. Skype wasn't the first one to provide internet based telephony services and there were many me-too products that came out subsequently, based on the same concept and technology, with varying degrees of success.

    Product Uniqueness: Topic focussed blogs (if you view them as individual products) come in various flavours and there may be several people writing on the same topic. But the ones that attract the most eyeballs and comments are those that have something unique and exclusive about them, ranging from quality of writing to real analytical insights. Many of the pure content aggregator blogs and websites sorely lack in this department and that reflects in their popularity graphs.

    Access to the 'system': Interestingly, the examples used in this response (Wikipedia, blogs) as well as those (Zagat, Google, Skype) mentioned in Prof Heskett's opening thoughts on the topic share a common factor. They are all internet based businesses. I doubt any of these would've have managed so much customer support if the customer interactions with the business were limited to phone calls, snail-mail, telepathy or smoke-signals.

    Lack of complete control over their business processes may be the biggest risk for such businesses. In traditional businesses the supply chain can be secured through legally binding contracts. But what happens to business continuity, if the customers who provide content, resources and other critical inputs that help run such customer owned businesses decide to stop their 'supplies' overnight? Unlikely scenario though, as the supplier base here is pretty large and diverse, and that makes it impractical to adopt unionized behavior.

    These are new evolving business models and one can only guess what future forms they'll adopt.

     
     
     
    • PulpTechie

    Customer feedback and input should be the cornerstone of every business. If companies fail, I believe they are either not listening to their customers, or using the customer feedback incorrectly.

    The comment by Bruce Duncil about creep is definitely relevant and a great example of misusing customer feedback. Take a generalized software project for example. Most software teams would do well if they spent (1) 25% of their time on bug fixes, (2) 25% on incremental improvements to existing features, (3) 25% on new customer requested features, and (4) 25% on new features that are beyond their customer's expectations/requests. I have worked with many software teams that spend 90% of their time on (1) and (2) because this is the lion share of customer requests and complaints. This is where creep comes from.

    As another thought, I believe that how you receive and integrate customer feedback into your business plans is greatly dependent on the stage of your business. Start-ups have to listen very closely to early adopters and would be foolish not to because early adopters are often betting on a product that is much better in the future, not now. Larger businesses would be better off using crowd-sourcing to help them sift through the often overwhelming amount of feedback. Salesforce does a great of this with Idea Exchange. I always wonder if US automakers would be better off if they used crowd-sourcing to help determine and prioritize their new car development efforts.

     
     
     
    • Alden Cushman
    • Research Director, SiriusDecisions

    I agree with Bruce Duncil. Customer provided input and feedback should be collected and evalutated in the overall company and product strategy, however, new technologies and communications channels (e.g., social media) can result in far too much influence being given to customers that participate directly and actively in the product development process. It comes down to understanding, clarifying and publishing your strategy(ies) and then putting in place a proper change management process that prioritizes customer requirements. This included running risk/reward calculations on any new requested feature, function, etc. Sometimes clients or even prospective clients will pull a company down a very narrow "custom" road that leads to a potential market of one which may prove to be very unprofitable.

    Listening to clients and prospects is always a good thing to do, but how that information is collected, put into context, prioritized, and impacts business decisions is the key to success or lack thereof.

     
     
     
    • Gerald Nanninga
    • VP, Retail Ventures, Inc.

    There's an organization in the Netherlands that has been following this trend for years and has a huge database of examples of what consumers can do. The organization, Trendwatching, has two sites: trendwatching.com and springwise.com. A good place to start is their database. Once you see the bredth of the potential, you would have to agree that most companies have only scratched the surface.

    There are really two things you can ask of a customer: to help in the creative element of business or to help in the advocacy of the business. On the creative side, there is only a small sector of society that is naturally creative. This is especially true if you are looking for something creative enough that others would pay money for that creativity. Hence, this may be the lesser opportunity, unless you only want to play in that niche.

    Anyone, however, can become a brand advocate. All you need are some tools. And I'm not just talking about advocate from a selling/marketing point of view. As Scott Cook and others point out, being an advocate for the community of those who could have an affinity for your type of product can be very valuable.

    On a similar note, I recently wrote a blog about Scott Cook's article and took the question to an even broader level than the one asked by James Heskett: Have we limited our potential by not only mislabeling potential partners as "customers" but in mislabeling everyone in the entire supply chain?

     
     
     
    • Ramji
    • Senior Manager, Ramji & co

    In software industries (Infosys, Wipro, TCS, IBM) the customers provided lots of suggestions, and based on that the companies have changed their products to be beneficial to all.

    I was told that ERP, RDBMS were born based only on customers' suggestions.

    Wherever the company feels that a customer's suggestion is not implementable, it should inform the customer in a polite manner with valid logic.

    I do not think that risk is involved because the customers/volunteers give only ideas. It is the company/seller who converts those ideas into policies/product/service. So the seller/company has to take the full responsibility.

     
     
     
    • Dr. Hemjith Balakrishnan
    • Group Sr. Vice President - Strategy & HR, Health Prime International

    Extremely interesting topic. A lot of hue and cry are made these days about the value of customer experience - are we delighting, dazzling or disappointing?. The buzzwords today are "getting closer to your customer", "a complaint is a gift" etc for the organisation to improve their products/services have taken centre stage in organizations. As we all know, progressive organizations have always responded to the views of the customers - both external and internal. They have responded to feedbacks received from customers and acted upon it by even facilitating to have "Customer Communities" built to support and take inputs for product enhancement or services.

    Also there are numerable Organisation Psychology theories such as Categorization theory, Labelling theory, role theory etc which looked at various data to enhance customer value. More to it, Organization have re-worked their vision statement to show their customer focus (care) such as - to solve unsolved problems innovatively (3M) to give unlimited opportunity to women (Mary Kay), to preserve and improve human life (Merck), to give ordinary folk the chance to buy the same thing as rich people (Wal-Mart), to make people happy (Walt Disney).

    On one hand we have innumerable incidents reported about dissatisfied customers who are angry and unhappy and appears on blog sites to express their frustration of unattended customer support service which does immense damage to a company's brand. And on the other hand we have concepts like "Social Marketing", Fansumers and Viral videos really bringing the customers to the centre stage in the "product and services say." South-west Airlines Nuts about Southwest and Enhanced Boarding are classical examples of customers adding value to the organisation through their inputs.

    However, the biggest challenges for the organisations are to have the necessary competencies and resources to act upon and capitalize inputs which can deliver superior results and have long lasting relationships with customers.

     
     
     
    • Hujaj Ali Nawaz Khan
    • General Manager, Tafani General Contracting L.L.c

    Definition of "Customer" is at the same time a science and an art. It is complex just like human body and easy just like using a napkin. The complexities involved in Customer behavior is always under the subjective and objective contexts of both science and art. The involvement of customer into your business processes behind the scene is becoming a brutal fact because of lack of resources and race to win the best deal by client and profitability/revenue management techniques used by the seller. Whereas the seller is defined as the most non raciest person on this earth but increasing pressures from deprived part of the world to catch their share and find new opportunities helps the customer to become seller instead of keeping on buyer end.

    The shift of Customer to become seller through use of technology, referral sales programmes, backdoor commission agents, reseller while being customer, and above all the quest of satisfaction from whatever spent from deposable income of one makes situation totally maneuvered and intermingled the boundaries of how much customer should be asked ? We need to define the customer and seller first, put some barriers to remain on one or exit and the interim space should be called as "channel partners" and their involvement should be studied separately instead of mixing with rest of the Customers. A customer should remain out of the circle of seller activities until one buys the product and should thirst for the satisfaction, not process, of sales/circle of seller activities.

     
     
     
    • Kapil Kumar Sopory
    • Company Secretary, SMEC (India) Private Limited

    Corporates engaged in businesses of all hues have to carefully understand that they would not go on but for the support of the customers. The bottom line is that the products and services have to be passed on to customers and consumers who have many choices before them to choose their product/service provider. Obviously, quality of the product/service weighs heavily when choice is made from amongst different providers. A customer rests content if his demands are adequately met. Once this happens, he becomes somewhat a brand ambassador for his preference is bound to get communicated, directly or indirectly, to his circle of influence. So far so good.

    At times, a customer gets dissatisfied and raises his voice in the shape of objections/complaints. It is when the problem solving ability of the corporate is tested. A good corporate will take all steps to redress the grievance to ensure that the complainant reverts to becoming a "friend" yet again - this lot will definitely speak well and this will help the corporate immensely.

    It is to be understood that the velocity with which dissatifaction travels is many many times more than of satisfaction and hence the caution.

    Some of the steps that could be implemented to invoke support of customers could be:

    1. organising customer meets,
    2. focused advertisements,
    3. distributing brochures/pamphlets,
    4. whenever possible, one-to-one meetings with the influential customers whose voice matters,
    5. inviting suggestions for improvement and treating theresponses as serious innovation possibilities,
    6. always watching what competitors are doing and making the best use of whatever suits for betterment, etc., etc.

    Managements have also to be truthful in what they profess avoiding window dressing which may not stand the test if confronted. Even an oblique expectation must not be raised on the customers to support or hide the corporate's failings as these will get revealed sooner or later.

    In essence, the customer is the "king" and he deserves special treatment. Then alone would he be of anticipated value throughout.

     
     
     
    • Narasimhan G
    • VP, Oracle Financial Services Software

    Many successful organizations have been immensely benefited by their Customers' contribution. The contribution varies from simple operational improvements to very strategic aspects depening on the level of people in the customer organization with whom we engage with.

    I can think of some examples...

    Customers' C level Execs contributing towards strategic direction in terms of where the industry is heading towards.

    The users of the product having gained expertise in the product or service they use, become expert problem solvers and thereby their feedback improves the product/service quality.

    User Interface and design is always a function of the end users perspective of the way they would like to use and the way they want the product to be designed, etc.

    These are just some examples and there are many more. Forums which could effectively create a customer community or user group or expert group, can bring the people with similar interest as users, decision makers, experts, consultants, etc. would be of immense use to an organization as each special interest group would bring feedback and thereby, value from a different perspective.

    From the risk perspective, these engagements need to be managed well else there could be vested interests which could mislead the groups or malign the reputation of the organization. Also, as the organizations grow large the ability to manage or control these groups also will become limited and the risks of corporate espionage, competition encroaching into these groups, sabotage from vested interests, etc could create increased risks. For taking the feedback, the company needs to use the Customers as one of the key stakeholders besides employees. It is very important to use customers and employees as two most important sources who could add immense value to the organization.

     
     
     
    • Inga Ness

    There is a lot to contribute to this topic (speaking of customer's contribution), but I would like to point out a fun example that reflects much of what has been mentioned above. That is the National Geographic Genographic Project, where regular National Geographic customers (magazine, channel or website) can participate in a 5 year project that traces the migration history of the human species. Now, without customer participation this project simply would not exist, and if it did not exist they would not have a Gene Project to write about and show in their channel or website, which for them generates profits, as it is their main business. What does the customer get in return? the satisfaction of being part of a Natgeo experiment and the results of it, as Mr. Cullinane explains. And just by mentioning it, I am at the same time doing unexpected marketing for them. It is an interesting cycle.

     
     
     
    • Sowmia Gopinathan
    • Manager- Group Business, Kotak Life

    I would definitely agree with Mr. Balakrishnan. The biggest challenge today for every company is the balancing of the resources & the customer expectations. This is basically again measured by competition analysis. All the major companies agree to the importance of customer involvement but ultimately the optimization of resources to fulfill the customer requirements is where the company stands productive/competitive.

    I believe the downside is only where the expectations of the customers are made high by involvement and the same is not met due to resource constraints. Otherwise, for any company to develop, customer involvement is the key.

     
     
     
    • Michael Peng

    As information technology advances, passiveness is no longer a descriptive word for customers. The nature of business competition forces vendors to involve customers in product design and manufacturing as well as in the delivering service process from the very beginning. There are many variations of customer involvement in different business modes, e.g., manufacturing products to mass customers, selling products to certain clients, and service-oriented business. Unprecedented customer involvement creates many new business modes. Especially in mainland China, where the economy is tranforming from a government regulated one into a market driven one, customer involvement will facilitate the economy-tranforming process.

     
     
     
    • M J Fleming
    • RN

    "Moreover, the company can easily be overwhelmed by the pressure of activist consumer who may not represent the majority." This quote from above author Adnan Younis Lodhi is to be the crux of the issue. If you have influence, you can lead in a horrible direction. Recently California outlawed the use of cages for poultry raising, thus greatly increasing the risk of disease and death in their people because they want the animal to be "free". This will also greatly affect the economy as the HSUS is intent on eliminating animal agriculture which contributes a huge amount to the economy of CA and the US. We should all be very careful of what we wish.

     
     
     
    • Jacoline Loewen
    • Partner, Loewen & Partners

    The boundary between business and customer used to be opaque and rigid, but is now more and more transparent and open.

    Co-operation with the customer must be accepted into the company strategy as a given. Even if a company does not want customers involved in their business designa dn delivery, it will happen. Hotels on exotic islands, far from the big cities, are rated on travel websites. Wouldn't it be better to just have a customer blog section on the hotel's own website where photos can be posted. If there is a bad story, the hotel can explain and apologize. Most customers want that fair exchange of dialogue. It reduces the perception of power inbalance which is what enrages the public against corporations.

    Here in North America, we have freedom of speech and political freedom. It's the economic freedom that upsets people as there is that perceived inbalance of power. By inviting in the customer, I think this process - or free trade - heightens the emotional connection.

     
     
     
    • Sunil Varughese
    • Director, Brand Indigo LLC, Dubai

    Encouraging volunteerism and ownership on the part of customers is a healthy first step towards tweaking the "service aspect" of extant business models.

    However, from a long-term perspective it is imperative that all stakeholders of an organization are given a 'sustainable' role across the value-chain.

    Embedding "sustainable practices" across the value-chain is the only road that organizations that wish to survive profitably can take. Mere tokenism at customer-facing brand touch-points is just not enough in these times when the world is in the midst of a recession and deflation rather than inflation appears to prevail.

    Many brands may lose their franchise during the next two years of recession as a result of customers 'trading down' or "brand-switching". Smart marketing or advertising will not be the answer to arrest the loss of franchise but embedding "sustainable practices" especially within the 'marketing function' is of utmost importance for all brands that intent to capture the hearts, minds and "share of wallet" of their target segments.

     
     
     
    • James Egbe
    • CEO, JP CONSULTING

    The expected role of satisfied customers in telling the story and getting additional customers have always been there like any other old theory. I think ICT has expanded the scope and the global village makes it a more useful tool for selling services and products.

    Even though it has its advantages, the whole issue is still limited to the customers loyalty and level of satisfaction derived from the company. A customer with inadequate product knowledge may be limited by only the satisfactory service/product delivery received. The company also runs the risk of the customer over promising another customer especially where there is limited product knowledge and incentive attached to getting additional customer. However it is still a very strong way to acquire new customers based on existing customer satisfation. If there are terms it should be clearly stated and all parties should honour their obligations when they fall due.

     
     
     
    • Jill Malleck
    • Senior OD Consultant, Epiphany at Work

    The term customer is becoming outdated even as we write about it. Many people do not want to be artifically attached to a company - particularly when they have no influence or say in how corporate decisions are made - simply because they had a product need. Buyer might be a better descriptor. Therefore each transaction - each purchase - stands on its on merit. Companies must be aware that customer loyalty - like employee loyalty - is a fading myth. A majority of people can't stay loyal in a marriage, never mind to a corporation. Give me a better product, at a better price and with better service, and the relationship is over.

    I agree that consumers - whether past buyers or potential buyers - are great sources of information for product development and service improvement. What restaurant doesn't want to know what recipes are popular enough to keep on a menu, in a particular location? But as everyone is now educated about Marketing and Media by about Grade 10 the cynicism grows. Kids are very aware of the flipside of customer intimacy - mainly, can I get you to buy more product? It pays to be honest and straight up about the extent you are "using" people to further your agenda. On the flipside, you also should be prepared to discuss or change features that buyers are unhappy about. Never mind enticing people in company blogs. Everyone on the internet knows how easy it is to research the real stories behind the "official" customer experience. Even professors and teachers are being rated by their students. (their customers)

    Organizations would do well to pay more attention to their employees. Free products, test products, huge employee discounts - all of these perks build goodwill, contribute to higher morale and provide a forum for input with little risk of annoying paying buyers. It also give employees a taste of what the buyer is getting, increasing empathy and compassion.

     
     
     
    • Pia Azarcon
    • Country Manager, ibm.com, Philippines, IBM

    I would use the word "advocate" instead. Making a customer an advocate of ones products ensures that there is a repeated sale and that the re-marketing effort to this base is not wasted. Advocates generate business for the brand unconsciously. Initiatives poured into turning consumers into advocates will be, in my opinion, more bang for the buck in the long haul. Not only are you reaching out to your target demographic and expect a realistic return out of the effort, but you are also assured that the advocate, at some point in the immediate, will "push" the brand to whomever will listen. I would like to see more studies of these advocates and how much to they contribute to a company's bottom line.

     
     
     
    • Nandana Kumara Uluwatta
    • Senior Lecturer, Wayamba University of Sri Lanka

    Arena of Buyer and Seller is debateble topic and interested. According to my view, both of them are customers. Customer loyalty can drive brand just as customer input can feed critical innovation is certainly consistent with broad industry experience. However commodity must satisfy customer needs. Customer satisfaction here is both producer/seller and buyer may be satisfied. Product development is equally benefitted to both parties for to serview in the market as well as for satisfaction and ultimately resulted in benefit of overall market share and profitability. Many product developers or producing customers have discovered that they do not have the internal capability to successfully manage separate core and product lines for speculative buyers or buying customers.

    Today we are facing mainly three strategic issues when dealing with each other such as Quality, Flexibility and Competitiveness. With rapidly changing global markets, it is becoming more common for both parties to be increasingly out of touch with their real needs or even have a clear understanding of their problems. In this situation as customers, product developers must play the role for the buying customers satisfaction. This may be resutted to benefit both parties, and their organisation and as well as for the whole society.

     
     
     
    • Mark Bright
    • VP, Business Development, Direct Health Canada

    While the engagement advantages to fully harnessing the comittment of many (hundreds, thousands or more+?) new found evangelists is intoxicating, at what cost? What if the "volunteers" are not truly representative of the future wave of "next product" consumers? Have we then just co-opted the wrong group to become our mistaken "bleeding edge"?

    If the volunteer customer was the new wave of intergrating the VOC within the process, why has the prevalent format of business organization not become centered about some type of co-operative structure based on this volunteer? Is it evolving in this direction? Can we have too much "customer" in the process?

     
     
     
    • Stanley Anemelu, MBA

    I believe in some cases, volunteerism on the part of a customer/consumer can be reflexive. When a customer/consumer has a good experience with a particular firm, the customer shares the experience with others without being asked to, likewise if it was a bad experience. However, the firm can control the risk by being proactive through immediate follow-ups after engaging in a business transaction with a customer; this could be done via email or phone calls, in some cases before the customer leaves the place of business. The customers would be asked questions about the experience and what the company needs to do to be more attractive to them. And the customers can be rewarded by offering them some discounts or credits depending on the situation. I believe that firms that employ this process see less negative impact on their business, even if a customer had a bad experience.

     
     
     
    • Ruediger Vaelske
    • Client Service Director, CPM Germany

    Internet and related media let the people move closer together and let them exchange very useful information. An example: I have a certain problem with the automatic climate control of my car. I googled that problem and found threads discussing exactly that problem. The guys in my garage did not know the simple technical solution that was given in the internet ...

    A company cannot neglect that development. Instead of sitting on their hands letting customers praise their products or complaining about them uncontrolled in different forums they better act pro-actively and invite them to do so in a company-steered forum. In those forums the company has the chance to comment entries immediately and to learn how the customer is acting, thinking and feeling. Innovations and strategies can then be developed from forum experience and other survey findings. What could be more useful?

     
     
     
    • Enrico Zingales
    • Honorary Member, ADACI (Purchasing Managers Italian Association)

    In my experience, the willingness of customers to participate in the improvement of a supplier (or to the whole supply chain) can change according to the final use of the item supplied, depending whether it is a consumer's final use or an industrial (manufacturing, trading) use. If the improvement could go to the advantage of competitors' companies, the customer is not interested in putting his supplier in a better position, unless establishing a no-disclosure clause. More than this: the manager must know himself how to run his company, must know his customers (his market) better than they know themselves. Their suggestions could consider only partial aspects and not benefit the whole company. The manager could pursue objectives that customers do not fully perceive.