IT is the business’s competitive differentiator to customer acquisition and retention.
More and more IT organizations are transforming from back end internal support function into front office revenue generators, during the journey, CIO must know how to answer the question such as: How do we get revenues now? How will we do in the future? How should IT help the company win business? And how can IT contribute to customer acquisition and retention?
1. IT Influences Customer Experience Directly
Besides internal customers, end customers should also be IT focal point, CIOs must go out and talk with customers to understand business and understand their tastes and current and future needs. Now technology can improve every touch point in customer intimacy, it provides a significant opportunity for IT to influence customer experience directly.
- Provide improved processes or better information to your customers: You can invest in business analytics or related technology which can help you spot new growth areas and provide value-added services to customers. You could also extend this by implementing predictive analytics technologies which could aid you in identifying which opportunities have the highest likelihood of success.
- Directly influence a customer's perception of a business: Deploy a range of technologies that focus purely on improving the customer's experience and perception of business services, showing the customer that you are making significant investment to deliver to them products / services which more closely meet their needs, you are doing so to a greater extent than your competitors. And you can enthusiastically present, directly or through marketing, the investments in such technologies to customers and prospects.
- Balance “invisible” & visible myth of IT: The optimal way for IT/Technology to help win new business is to make most of IT/technology "invisible" to the customer. In other words, hide the complexity of IT/technology infrastructure & operations. What is left visible to the customer should be simple, intuitive, secure, reliable and predictable. This requires a cross-functional customer-centric paradigm for managing and operating IT/technology. Also keeping relative transparency is a major part of customer influence, the ‘visible’commitment of the whole corporate body behind those deliverable.
2. IT Enables Business to Understand Customer Deeper
The two prime questions any business should understand about customers are: What do they buy and why do they buy it? IT as information steward that will enable the business to discover the answers and understand customer deeper.
- New technology tools and business models allow a company to capture customer information on a continual basis: Imagine collecting valuable information about customers in real time and getting that to the right teams inside your company. This is the reality of many of the web and social media tools. Bringing the customer closer into the value chain has allowed business to collect vast amounts of information about customers. Business intelligence tools then allow management to analyze that information to create robust customer experiences and make better product decisions more quickly than before.
- IT enables business innovation to create a value proposition that would move your prospects to become your clients; more importantly, to improve customer retention: Everyone focuses on customer acquisition when they should be focusing on customer retention. This is the problem that IT has the potential of solving. To the degree that IT can help companies keep in touch with their prospects and clients in a personalized manner, the greater degree of success that company will experience in comparison to its competition. The “hard” technology can create such soft touch, to make people feel better about themselves. As the saying goes, "People don't care how much you know until they know how much you care."
- IT understands deeply the value chain of business, value chain of the industry segment and value chain of the business ecosystem where it competes: It can find areas (not to automate) but, to innovate in the way certain tasks are done with the help of technologies that allow rapid testing of processes and outcomes. Thus, IT enables the business to understand customer deeper via an in-depth understanding of business value chain and oversight of key business processes.
3. IT Works with Business Partners to Drive Business Growth
IT should help the company achieve its business objectives in any way possible and the first step is forging close relationships with the senior execs and business managers to really understand their goals and plans for expanding their area. Then you can suggest and implement IT solutions that move them forward.
- Make sure the executive team first understands what it needs to drive future business growth: Put the framework in place to map the strategic objectives into KPIs and then determine what technology investments will accelerate the changes you want to see in your KPIs. Companies are recognizing that IT is roughly coupled to the business strategy, and it is a very good sign about how the companies will deliver value.
- CIOs have to be an integral part of driving business value: They can do so by marrying technology with strategy. In order to marry technology with strategy, Information executives have to be fully aligned with the business executives in articulating business strategy. Establishing the policies: (1) "Procurement strategy" for Enterprise cost reduction efforts or (2) Launching innovative delivery channels for improving sales revenues, or (3) Visioning the future product strategy or any others, Information executives have to be hand-in-glove with the business owners to map out the vision/ strategy.
- There are front end and back end of the IT Department: The front end is the portion that helps with the business, customer solutions and how IT can bring back the "scientific" support effort that people used to trust. "The company's IT Department supports a certain solution... The customer often taps their own IT Department for their thoughts, for their innovation, when they match up, customers go for it. The back end is the part that acts like Accounting and HR, a business model support function. The trick is how to put it together without taking from each other's resources, time, and money.
- If IT is supporting the business goals, it will help the company win business: There should also be strong interaction between Operations leaders and IT leaders and their teams with feedback mechanisms and willingness to find solutions that can support both the business need and build any ROI required to justify the business case. At the age of complexity and uncertainty, working with vendors/business partners in technology in a consultative manner can often open out ideas since they will be looking for business pain and solutions that IT/Technology can drive. It is also important to measure and validate the ROI.
- IT can work cross-functionally and drive value in three ways: (1) Stability allows the Marketing, Sales, Service and Fulfillment components to continue to deliver the cash-cow aspects of the business. (2) Agility allows the CIO to consider ways to drive more ROI, integrate services and any number of additional IT value-added components which can be provided..(3) Integration: moving to integrate the IT strategy within the framework of innovation and generation of products and services of the organization to attract and keep customers.
Therefore, IT is the business’s competitive differentiator to customer acquisition and retention. IT is also a business catalyst to optimize processes and enable innovations, to win customers' heart and mind in the long run.