Tuesday, July 17, 2012

Strengthen Customer and Supplier Intimacy


What is Customer and supplier intimacy?
Customer and supplier intimacy strategy utilizes information systems to develop strong ties and loyalty with customers and suppliers. Parties, customers and suppliers are important to firm. Strengthening customer and supplier intimacy can be an extremely effective strategy in itself. Through making transactions in general easier and more user friendly for both customers and suppliers, the intimacy of the firm and customer/supplier will increase. This offers great incentive for both customer and supplier to continue doing business with the firm. 


Customer intimacy creates an honorable circle: the better the supplier knows the customer company with its objectives and difficulties, the better able he is to provide a most advantageous solution. The more adapted the supplier's service is, the happier the customer will be, and the stronger the relationship between the two parties.

Customer intimacy is the largest basis of the growth, competitive advantage and profit. Everyone in the organization should practice it. Customer-intimate companies bring an entirely fresh viewpoint. They discover the occurring problems and create a dynamic synergy with customers. In the incorporation of the operations, suppliers become more than simply useful: They become vital.

Customers control the core of a successful firm if they are denied the services. When the power of a customer increases, the ability to hold and control prices decreases.
Suppliers have wonderful market power. If a firm has only one supplier, it has little control over the price, quality and delivery schedule of the goods or services. As the number of suppliers increases so does the control of the firm over the suppliers.


However, the companies gain opportunities for brand building and loyal customer base creating. For case in point, Thai Airways and Emirates increase switching costs for their customers by initiating the collection of airline miles to amplify the number of loyal customers. The other example is Chrysler (Custom published magazine from customers’ database) and Amazon (Customers’ personal customization by book recommendation based on purchase and website visiting history)

What You Should Do As a Customer-Intimate Company?
·    Take responsibility for your customers' messages. This originates from sharing information and building trust.
·    See your customers' problems as your own. Remember that customer intimacy is the best way to create hard, tangible, rewarding results for both sides.
·   Engage in truly cooperative partnerships with your customers. Integrate your operations with those of your customers to develop new products, services, or solutions.


Benefits to Everyone in Your Organization
Customer intimacy,
·          Gives senior managers a new vision of the future, a strategy that makes sense, and the tactical actions to make it work.
·          Helps sales and account managers build deeper and more productive relationships with selected customers, support them with a real-world model of success.
·          Helps IT professional’s leverage emerging innovation: keeping information flowing back and forth to customers, and coaching them on how to get the best results with that information.
·          Helps HR professionals to deal with a most sensitive challenge of the commitment to deliver results – to integrate the supplier's personnel into a customer's operation.



Customer Intimacy as a Competitive Advantage
Businesses have traditionally relied on technology and product innovation for competitive. However, as products became supplies due to global competition and insistent technological advances, customer value creation shifted to customer intimacy and service. This service-focused competitive strategy has worked well for numerous companies across various industry sectors.




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