What did these firms have in common?
They were all taking the journey from product-centered companies to service-driven business models - based on the notion that "customer intimacy" surpasses product sales for its value-creating potential.
Because of competitive pressure, many corporations have begun the journey to become solution led; or as we say "started to explore the Intimacy Engine™ business model." We've worked closely with dozens and dealt with hundreds of these companies and most are daunted with this business model change. Let's be clear, there is a promised land that allows companies to weather storms because they have become indispensable to their customers by building large portfolios of ideas that solve true important business problems - not just selling products, bundling products and services, adding professional services, or marketing solutions (think IBM and their success during the recent downturn).
This blog will be focused on the components of the transformative journey - what gets in the way, what keeps many from success, and what are the best ways to get through the journey.
Most complex B2B businesses need to move to this model at some point in their business cycle - particularly when they find that their innovation curve is no longer providing a long period of price differentiation for new products or product extensions.
However, most companies do not see the journey as moving to a new business model for which their current structures and measures are ill equipped. Further, many believe it is just a new way of selling - like so many sales training courses over the last 20 years. And finally, because this transformation is so different and difficult, they under-invest and set short-term success hurdles that cannot be met - and then get frustrated and quit. Often the very things that made these corporations successful in their high growth periods stand in their way moving to the new model.
I think the customer intimacy journey affects every level of an organization: corporate, operating divisions, sales, R&D, financial measures, staff functions and maybe most important of all - individual leaders - struggling to make sense of the journey and how they can be successful. Through it all I have become more convinced of the power of the customer intimacy engine as the key business model for survival.
This blog is our response to this challenge. We want to ask questions, discuss alternatives, and help shed some light on customer intimacy as a business model. Specifically, we hope to:
- Advance our collective knowledge of the definitions, trends, and technologies for Intimacy Engine™ models.
- Examine the strategic alternatives available, i.e., how are business models going to change?
- Define an Intimacy Engine™ maturity model - the choices and use cases for large enterprises in a way that makes sense to leaders
- Develop recommendations for creating an Intimacy Engine™ discipline within your organization; present sample business justifications supporting "intimacy engine" investments.
- Define and understand the critical factors that contribute to improving customer intimacy.
- Discuss lessons learned from our experience over the past twenty years.
- Create a framework for measuring the Intimacy Engine™.
- Disseminate information on next practices, news, events, and relevant information on a regular basis.
I also think it would be helpful to examine the reasons for lack of success by companies seeking to change. Like any change initiative of this magnitude - many fail. I want to lower that failure rate and assist companies in understanding what does not and what does work.
Finally, we will examine best practices from top to bottom:
- what do the executives need to be doing?
- what are the organization models?
- what are the roles of HR, Finance, IT?
- how are true solutions created?
- what is the best portfolio model?
- how are account relations altered?
Please feel free to participate by commenting on the posts that follow. I can be reached at McMann and Ransford.