All Posts in Strategy and Tactics

|In: Leadership|Last Updated:

The Internet is:

a) A vehicle for completely transforming society.

b) A source of useful information.

c) A new venue for marketing and commerce.

d) On the verge of collapse.

e) Excedrin headache #3.

I’m guessing most readers of this column would choose “e”. That’s too bad, because the Internet can be a great route out of the corporate slums for all of us in Information Systems.

Aren’t you tired of being viewed as a Money Pit? Focus on reducing costs and increasing productivity and that’s where you’ll stay. Like it or not, lots of companies see us as a necessary evil – money they’d rather avoid spending but are stuck with, like payments on a failing car.

No, you want to hook up with Marketing. That’s where the fun is, because that’s where revenue comes from. Revenue gets respect. Revenue gets glamour. Revenue gets … funding!

Right now, companies see the Internet as an intriguing marketing opportunity. Embrace it and get on board. If you need help, this is a great opportunity to flog my new book, Selling on the ‘Net, (National Textbook Company) due out mid-September, co-authored with my friend, father and great guru of direct marketing, Herschell Gordon Lewis.

Marketing has three basic goals: acquiring new customers, reducing customer defections, and increasing volume with current customers. While you’re lunching with your new marketing-director friend hearing details of your company’s plans for accomplishing these goals, point out that while the Internet has a lot of sizzle, several other technologies have much more potential. “What might those be?” he or she is sure to ask.

I’m glad you asked. Of a long list, here are four.

Data Warehousing: Here’s the perfect platform for a killer marketing database. You can use it strategically, to understand who buys what – information you can use for corporate planning.

You can also use this database for tactical marketing. What you know about each current customer’s recent buying habits helps you create tailored offerings to more effectively increase per-customer volume. You can use the same information for targeted marketing to non-customers, selling each one products and services popular with demographically and psychographically similar current customers.

Electronic Mail: Yes, plain, ordinary e-mail can become a powerful marketing weapon, and no, you don’t have to become a spammer. Do you have a customer newsletter? Offer it to customers via e-mail as an alternative to paper. Just set up a list server and make it easy for customers and prospects to subscribe.

Correspondence with subscribers isn’t spamming, it’s service – they’ve already expressed interest. Send them customer satisfaction surveys by e-mail. Use them as informal focus groups for refining ideas about new products and services. Use your imagination. E-mail, because of its immediacy and informality, cements customer relationships far better than any paper alternative.

Computer Telephone Integration (CTI): Here’s a wonderful technology. It has huge potential, but no logical internal sponsor until you came along. Add screen-pop to your call center (that is, automatically display customer records before transferring calls to call center agents). Add intelligent call transfer, where transferring a customer call from one employee to another also transfers the computer screens.

Add data-directed call routing, where information about a caller in your databases (or data warehouse) determines who should receive the call.

The secret to successful CTI: every customer contact must enhance the relationship. Every customer service interaction becomes a (soft) cross-selling opportunity and every sales interaction becomes a customer service opportunity.

Electronic Data Interchange (EDI): EDI, the electronic exchange of formal documents like purchase orders and invoices, has never lived up to its potential due to the extraordinary difficulty of converting EDI transmissions into database updates. Turn this to your advantage: customers who successfully exchange EDI transaction sets with you are unlikely to leave you for a competitor – it will cost them too much.

There are other customer-facing technologies, too. Let someone else maintain the accounts payable system. In this Olympic year, go for the gold.

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|In: Organizational Effectiveness|Last Updated:

I’m on vacation this week, so we’ll take a break from our growing bestiary.

Instead, you get another re-run. No, nothing from I Love Lucy. This one is from the near-exact precursor to the Digital Strategy beloved of the business-pundit faithful – the advent of the World Wide Web and how it plunged IT knee-deep into dealing with Real Paying Customers.

– Bob

My alternative pointing device worked when I plugged a keyboard into the back of my laptop computer. Otherwise the laptop reported a keyboard error.

When I reached tech support, their representative diagnosed it as a BIOS problem. “But it works with a Microsoft mouse,” I pointed out. “It’s a problem with your laptop’s BIOS,” he repeated.

“Your literature says you’re 100% Microsoft mouse compatible,” I added. “We are,” he replied. “Then why does a Microsoft mouse work but yours doesn’t?” I asked. “They use a four-pin interface. We use six pins,” he explained. “I guess that makes you 150% compatible,” I guessed, sarcasm getting the better of me. “Well, I’m not going to argue with you,” he answered.

Wise move.

Here’s the odd part: he knew how to fix my problem.

We’ve been talking about the differences between internal and external customers. Not everything is different, of course. If an end-user calls to report a problem, don’t argue – the user does have a problem.

Don’t assume you’re smarter, either. Not all end-users are stumps, you don’t know everything, and you’ll gain the respect of your end-user community if you show them respect yourself. Explain what you’re doing, tell them what to expect, show interest in how they’re using technology, and leave them smarter than when you found them.

That’s how you should treat Real Paying Customers (RPCs, to use the technical term) too, and because of the Internet, you’re going to have a whole lot more to do with them than you used to. That will be the healthiest shock we’ve had since the personal computer forced us out of our glass house.

The Internet, and more specifically the World Wide Web, is like Columbus. Columbus wasn’t the first explorer to reach the western hemisphere, but he was the first who couldn’t be ignored. In similar fashion, customers have interacted directly with other technologies, but IS largely ignored them. (Did you build your company’s fax-on-demand system? Do you know much about the Automated Call Distributor, and have you added screen-pops, customer-controlled queuing, and data-directed call routing to it? Do you know the definition of Lifetime Customer Value? I rest my case.)

You can’t ignore the Web, and so, probably for the first time, you have to start thinking about serving your company’s RPCs. That will change everything.

For the better.

Remember when you did feasibility studies, requirements analyses, external designs and internal designs before you got around to coding systems a few years later? Forget it. You’re going to start working in marketing time.

What’s marketing time? That’s how long your company takes to get new products, services, and pricing programs into the public awareness to beat your competition. Years? Forget it. You’re going to be working in months. Sometimes weeks. That means a whole different way of designing and building systems. (We’ll talk about how in a future column.)

Remember when you justified everything you did by showing how it would reduce costs or increase productivity? Forget that too.

Now you’re going to justify your existence based on how well you help the company attract new customers, retain the customers it has, and encourage every customer to do more business with you. When you’re done with InfoWorld, take a look at your current IS project list and mark the ones that have a discernible impact on your company’s ability to attract and retain customers.

I’ll bet that for most readers it’s better than the previous year’s list, but still pitiful. Probably, you’re setting priorities based on the needs of your internal customers. Next year, see if you can bring external customers into your Systems Steering Committee (if you have one). For every proposed system, ask, “How will this help us attract and retain customers?” You think you’re having fun now? Wait until you facilitate that session.

From here on in, you’re face to face with real customers. And that really does change everything.

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