How do you feel about my value to you?
Our customers’ answer to that question shines a light on reality that tells us where we stand with them and how far we need to go to reach our desired relationship with those we aspire to serve. This is true of past, potential and existing customers.
The key word in the question is feel. The question is not about a score card, nor ROI analysis. Instead, it seeks to grasp the customer’s gut feeling about our value to them. Great insights lie within a well articulated description of that gut feeling, and they are ours for the asking.
How do we ask, and how do we process the answers? As for asking, it is as simple as connecting with the right level of management in the customer’s company and asking the question as simply as it is constructed. want to share a conceptual framework with you which can facilitate the dialog about this important question, capture our customers’ responses to it, and define the answer we aspire to achieve, an invaluable help in plotting our journey to it.
The framework is based on my own experience in serving customers and in being served by those who consider me as their customer. It is a hierarchy of 9 levels that cover the full spectrum of customers’ gut feelings about our value. The levels are not sequential steps; rather, they are discreet points in the spectrum with a value rank relative to each other.
The Red Zone
This is the lowest level in the framework. When a customer feels indifferent, there is a total lack of interest in the supplier. It may be because the product or service offered by the supplier is irrelevant to the customer. For example, if our business offers quality steak dinners, we expect vegetarians to be indifferent towards us. We can accept their indifference by sticking with our menu and being indifferent to them, or we can expand our offerings to include them and hope to win their interest.
A potential customer’s indifference towards a new supplier can also be a result of deep satisfaction with current suppliers and a lack of desire to even consider a change. If we want to change this customer’s feeling, we must show a value proposition so compelling that it is visible to the customer above the high wall of indifference. Of course we have a choice to not spend our energy doing that, and instead focus on lower hanging fruit.
At this level, the customer is interested enough not to be indifferent. He has looked at the proposition, but does not believe it is real for him. It can be a result of disbelief in the portrayal of the proposed value, or that the proposed value will not translate to his specific need and circumstances, or for some reason he may not trust us to deliver.
Our response depends on understanding which of the above reasons is behind the cynicism of this customer. This is not a time for debate or argument; instead, use actions over time to attempt to erode this customer’s feeling of cynicism.
I remember trying to get one of Intel Custom Foundry’s most important potential customers to sign with us. It started with a discussion in which they told us they believed in our value proposition, but they did not think we would be in the foundry business for the long term and therefore it would be a mistake for their company to spend the astronomical switching costs to sign us up as a supplier. We respectfully heard the reasons for their lack of confidence in our long-term commitment and worked for three years to get them out of this level of cynicism. During this time, the lines of communication were kept open with regular lunch meetings in which we had casual conversations about the state of the industry and about our respective businesses.
While disappointment is a terrible level to be at, it is better than indifference and cynicism because the customer has come along with us and she cares about us enough to be disappointed, and even angry, with us. It is an opportunity for us to acknowledge and right the wrongs. It is an opportunity for us to win her all over again and to show her that we too care enough to want to get out of this level. We are not likely to stay at this level for too long. We either seize the opportunity and move up the hierarchy or lose the customer to indifference.
The Yellow Zone
At this level, the customer is intrigued. If she is a potential customer, she is opening the door for us to win her as a new customer. If she is an existing customer, she is intrigued by our roadmap or aspects of our offerings which she feels may be new sources of value to her own mission. She may hide the intensity of this intrigue to keep her leverage, and/or try to validate her intrigue through indirect questions. We must have sharp sensors not only to pick up on the intrigue, but also to pinpoint the specific need of her mission and the offerings at the center of her intrigue. Only then can we amplify and target the value of our offerings to clinch the deal.
At this level, the customer is concerned about whether we can deliver in response to his decision to go with us. The concern can be a result of a disappointment in the past or the natural concern of signing us on. Acknowledgement, transparency and honest assessment of status are key to addressing these concerns. Good news must be delivered with an explanation. “It was our good luck” is not a good explanation. Bad news must be delivered in its complete form and with a transparent explanation of known causes and plans to rectify the situation. The worst response we can give the customer who is concerned is “Trust us. We will take care of you.” A response like this will only escalate the concern, and the gut feeling will tumble down a few levels.
The customer need is real and strong. Our offerings are compelling enough for the customer to rely on us to deliver. The customer can’t wait for our deliverables so she can quickly integrate them into her operations. Based on past experience or watching us give status updates on the current deliverables, she has every reason to think we will deliver. This is our opportunity to bank equity in her heart with our performance. Our transparency and adherence to guidelines for delivering good and bad news as discussed in level five apply to this level as well, for it does not take much for the customer to step down a few levels.
The Green Zone
We enter the green zone with a level that represents deep customer satisfaction. We have met our promise of value and lived up to the expectations in the heart of the customer. He is delighted with our performance and delighted with the proof that his decision to deal with us was correct. He fills our bank account with tons of goodwill and lets us know of his gratitude towards us. He may show it with a smile, loud praise, an endorsement, an award, or even a monetary extra. Should we rejoice? You bet. This is a major confidence boost for us. We have, after all, not only delivered our value, but we have also helped him realize that value through operational integration of our offerings. But we can’t rest on this laurel. We want commitment for the long term. Our response after we thank him for his gratitude must be to strive to do better and to climb to higher levels.
The pattern of delight and the richness of our roadmap brings our customer to the next level – to excitement. She now views our relationship as a valuable partnership. There is delight in the road travelled and confidence-based excitement for the future. She actively works to identify more and more areas in which our offerings can be of use to her. She is energetic in her reviews of our plans and forceful in her attempts to influence them. She is inviting us to a vibrant collaboration and win-win future together. Our confidence is soaring and so is our own energy in discussions with her. We must understand and internalize her dreams. We must stand ready to alter our plans to fit her needs. And we must do everything possible to continue our streak of success and transparency in our communication with her.
This brings us to the level that we strive to achieve. We are integrated with our customer’s enterprise and we are both critically dependent on each other for our individual success. Based on our history of performance and the relevance of our rich roadmap to his mission, the customer is no longer guarded. He discusses his strengths, weaknesses, opportunities and threats with us freely. He shares his own roadmaps and forks in the road with an expectation that we will co-envision our future together. Feedback is real-time and two-way. We no longer need to wonder about the answer to the question with which I started this blog because we already know the answer. However, to keep integration going, we must check in from time to time to force ourselves to step back and consider. The customer himself will have a genuine desire to ask the same question to us: How do you feel about my value to you?
At this level, we have become one with this customer. Our aim now is to hang on to this level and ensure that we both will harvest the fruits of our partnership for a long time to come.
It is very important to understand where we stand and where we would like to get with a customer. This answer is not always available in formal customer presentations, so we must find other ways to perceive their gut feeling towards us and chart a course to get us to being one with them.
I read your reactions to my blog with great interest and a desire to learn from you. Thank you for your reactions and please keep them coming.