Challenges create opportunities, and this is particularly relevant during tough economic conditions. It is not enough to review your own internal cost cutting measures. A global economic crisis demands attention to the needs of clients, consumers, and your strategic partners. To look out for your future means looking outside your company and adjusting your internal strategy to accommodate future growth.
Summing It Up in Two Statistics
A survey by Harris Interactive revealed that 52% of customers responded that Outstanding Service is the number one reason for doing business with a company. 38% responded that Lowest Price is the number one reason to do business with a company. What does overwhelming statistic mean in a strategic sense? It is simple, while striving to reduce cost and offer a competitively priced product or solution, do not sacrifice your customer service or you will be the one ultimately paying the price.
Top Tips
Cost cutting cannot make up for economic challenges if the reductions impact your ability to generate revenue. When revenue and consumer spending is scarce, it is even more important to leverage your organization's ability to create new opportunities and to satisfy existing customers. Consider new services from within your organization and from innovative partners to stimulate your own economic recovery by offering outsourcing and cost cutting opportunities to your clients. Clients and consumers are willing to investigate low cost customer satisfying options that they may have ignored during better conditions. Helping customers cut costs may create new service revenues for your company.
Don't discontinue any existing customer initiatives during uncertain economic times. If necessary, adjust the scope or the schedule of your initiatives to accommodate your budget or your client's budget. Demonstrate your commitment to your clients and your willingness to persevere.
Proactively communicate with your customers. Maintain a strong relationship and do not allow an opportunity for your competition to steal your clients. Furthermore, make sure that you are aware of the financial conditions of your clients. Help your customer to deal with economic challenges, and be aware of how the profitability of your customers will impact your own business trends.
Organizations and consumers are much more deliberate about purchasing decisions during uncertain economic times. Provide adequate information for your customers to make informed decisions, and provide economic comparisons to demonstrate your competitive virtues. Make it easy for your customers to recognize the financial benefits of your products or services in comparison to competition, alternatives, or lack of action. Sometimes a lack of purchase, or lack of investment, can have detrimental fiscal impact on your clients, Make it easy for your customers to justify the decision to invest in you.
When budgets and pocketbooks are tight, purchasing decisions are often delayed. During these conditions, it is even more important to nurture your pipeline and to maintain a stream of communications with prospects and the market. Many organizations reduce marketing and communications budgets to cut expenses when time are tough. There may be discounts available for advertising. Look for opportunities to convey your message, especially for the gaps created by suddenly absent competitors.
Monitor the return on your marketing and service investments. Identify those opportunities that have the highest yield for both short term and long term profitability. Shift your investments to the areas with the highest returns and lowest risk.
Invest in innovation and technology. Improving your infrastructure should improve internal efficiency with applicable automation, and investments should also improve customer satisfaction. Some IT investments directly impact your customers, and some improvements enable the internal resources to better monitor and be responsive to the needs of customers. Before slashing a program from your IT budget, consider how it will impact the ability to take care of customers, and how that reflects on your ability to sustain the revenue that comes from loyal customers. Customers will remember your actions long after the economic hardships have receded. Your communications and your commitments to your customers will be remembered long after the pains of the uncertain economic turmoil if forgotten.
IT Investments
TechWeb Research asked the question, "How important are each of the following business imperatives in terms of priorities that your IT organization must support?" The results of this survey were published as "The State of Business".
Improving Customer Responsiveness: 64% High Importance, 30% Medium Importance, 6% Low Importance
Reducing Costs: 63% High Importance, 32% Medium Importance, 5% Low Importance
Speeding Product Delivery to Market: 57% High Importance, 33% Medium Importance, 10% Low Importance
More Agile and Streamlined Integrated Supply Chains: 41% High Importance, 48% Medium Importance, 23% Low Importance
Global / International Expansion: 38% High Importance, 27% Medium Importance, 35% Low Importance
Integration due to Mergers and Acquisitions: 24% High Importance, 40% Medium Importance, 36% Low Importance
How would you rate each of these areas with regards to importance?
How do you think that you organization rates the importance of each of these areas?
How do you demonstrate the importance of these areas in your decisions, your budget, and your strategic initiatives? Customers will make their current and future purchasing decisions based on the communications and decisions that you demonstrate today.
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Words of Wisdom
"Technology is a way of organizing the universe so that man doesn't have to experience it."- Max Frisch
"For a list of all the ways technology has failed to improve the quality of life, please press three."- Alice Khan
"Letting your customers set your standards is a dangerous game, because the race to the bottom is pretty easy to win. Setting your own standards--and living up to them--is a better way to profit. Not to mention a better way to make your day worth all the effort you put into it.”- Seth Godin
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