TTF;
I thought you would find the following of some interest...
THE COMING CUSTOMER REVOLUTION
By Don Peppers
A dramatic transition is under way - one that will propel the
world's major corporations to organize around customers
as opposed to product lines or geographical business
units. Citing the results of their new survey of global
companies, Andersen Consulting ( ac.com )
and the Economist Intelligence Unit ( eiu.com )
argue that "Customer Relationship Management" is now
moving to the center of corporate strategy. While only 18
percent of businesses surveyed are currently organized
around customer type, the figure is expected to rise to 50
percent by 2002.
Companies are increasingly shifting attention from
attracting new customers to retaining and growing
profitable ones, according to the report. Major findings of
the Managing Customer Relationships survey of 200
senior executives in North America, Europe and Asia
include:
-- The number of businesses citing "customer retention" as
a critically important measure in the next five years has
jumped to nearly 60%, as companies shift their focus from
attracting new customers to retaining their more profitable
ones.
-- Companies are becoming more sophisticated at tracking
customer profitability. Nearly 50% said that customer
profitability will be a critical measure by 2002, up from 26%
today. A greater number will be measuring not only
customer revenues, but also when they pay, their service
requirements, and whether they generate special handling
costs.
-- Companies will increase their empowerment of front-line
employees and create cross-functional links that integrate
the front line with other parts of the organization. While
only 27% currently report a high degree of integration
between sales and IT functions, 76% expect such
collaboration to be common by 2002.
-- By 2002, 83 percent of companies expect to have
customer data warehouses, up from about 40 percent
today.
-- More than 60% of businesses believe that "changing
customer demographics and needs" and the "pressure to
customize" their offerings in light of these changes now
have the most profound influences on their business
strategies.
-- This new sophisticated approach will be aided by the
evolution in interactive technology, specifically the soaring
popularity of the Internet. Companies predict their use of
the Internet to collect customer data will surge 430% by
2002.
"Focusing on customer needs seems the most basic,
fundamental tenet of business. Yet, major corporations are
just now beginning to blend strategic thinking,
management resources, front-line support and technology
to better understand and serve more sophisticated
buyers," said Dale Renner, global managing partner of
Andersen Consulting's Customer Relationship
Management practice. He also pointed to the growing
importance of assessing customer value: "Not all
customers are created equal. Companies are increasingly
gathering more data to discern the differences among
customers and shape their offerings based on the relative
value these customers bring to the enterprise."
We couldn't agree more. As companies realize that
different customers have different values, they will be able
to coax their Most Growable Customers in more profitable
directions - and make their Most Valuable Customers
more loyal. The report, "Managing Customer
Relationships," is available from The Economist
Intelligence Unit, Tel: 0171 830 1007 (United Kingdom) or
(212) 554 0600 (United States).
PS You don't want any of me on the golf course. |
