“Because its purpose is to create a customer, the business has two – and only two – functions: marketing and innovation. Marketing and innovation create value, all rest are costs”. Peter Drucker
I am currently reading Peter Hinssen’s excellent “The New Normal – exploring the limits of the digital world” giving me plenty of new insights. Even though the book is a couple of years old it still describes the impact of digitalization in a smart and direct way. One topic highlighted in the book is around marketing and customer interaction. How do we actually interact with our customer in the digital era? And, what can IT learn to improve its interaction with business? Is there a difference?
“We see our customers as invited guests to a party, and we are hosts. It’s our job every day to make every important aspect of the customer experience a little bit better”. Jeff Bezos – CEO Amazon
Marketing is undergoing a complete change due to digitalization, from mass monologue to customized dialogue with customers. The change is not difficult to understand as patience with non-relevant information is close to zero, change is constant and experience and contact are the new kings. It is about how I as a customer can get what I want, when I want it in a smooth and quick way. No disruptions are tolerated. It is all about “you” as a customer. Therefore we need different customer channels, and these channels need to change constantly. It is all about creating a great customer experience for the customers relating to expectations and interaction.
One key difficulty in the business and IT relationship is about communications. I have myself experience the difficulties of miss-matching business expectations with IT services. One example is outsourcing where IT can communicate “green” SLAs (everybody should be happy) but business is still unhappy about the delivery. Why is that? This strained relationship gives rise to a “blame game” culture about who is right and wrong. The internal brand of IT is deteriorating each day giving IT the role of a production unit (cost center and not strategic partner) and outside important strategic discussions. This is a common but dangerous path as the future corporate competitiveness is starting from IT in the new digitalization era. IT is quite clear that the IT business channel and marketing capabilities of IT is not really working. We need to change this today!
But is there a difference between how the company sees the customers, and how IT sees business. Not really. Both relationships are part of the same value chain and need to be in synch. To avoid friction and inefficiencies, both relationships need to have the same basis for marketing and communication – based on customer experience. What is driving this change is digitalization but maybe more unpredictability. We frankly do not know what our business or customer want in the future or what channel they are going to listen to. It is therefore not recommendable for IT to provide fixed services, fixed communication channels and long-term structures and process to fulfill the expectations of business. IT needs to move from “Operational Excellence” to “Customer Intimacy” (see earlier blog posts).
Let us briefly set the scene in the IT business relationship based on the new thinking. What we generally can say is that the value of IT is based on experience and expectations. The successful IT units or organizations are those that can manage the business expectations are the best way – given IT marketing. But what is business expecting?
- Business have no patience for non-relevant information (IT reports in IT language)
- The business requirements will change constantly (unpredictability)
- Business want to be approached in different ways depending on situation
- Business want the services they need to be successful (not what IT provides)
- Business wants their services immediately without trouble!
These expectations are not new but what is new is that IT need a new approach based on IT marketing. If IT is to run as a business – then IT need to include marketing capabilities based on business understanding to unleash performance. The “old” IT organizations pushing services to business through the service catalogue with limited interaction is dying as a concept. IT needs to re-invent itself focusing more on value creation (marketing and innovation) to support a business success in the future. Mass communication to business (standard IT reports) is no long valid – it is about customized dialogue.
So what can we do? Well, it depends. There is no “silver bullet” but rather to understand how your business partners work and what triggers their success.
- Understand how you today communicate with business. Do they get relevant customized information or mass-produced IT reports? What reports can be removed? What need to be added?
- What channels are used to interact with business? There are probably multiple interaction points in the relationship – how do they work? Are the channels synchronized? How are there constantly updated?
- How do you understand the expectations of business? Are the expectations mapped in someway? Do IT discuss with business the fulfillment of these expectations?
- How are the services delivered? Are the service offerings dynamic based on innovation? Are they seamless without trouble and great speed?
- If you do not know where to start – get help and contact me!
The era of digitalization and the “age of you” have re-shaped marketing and business IT interaction. The new mantra is around “learn and leverage” to create the best experience for your customers and business. To learn how your customer or business partner work and leverage on that knowledge. There are plenty of frameworks (provided by The Goodwind Company) to address these topics and actually driving business success. What is your first step?
– Hans Gillior