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A tight economy and better informed customers are forcing organisations to find a new competitive edge.
This edge can be obtained by measuring and rewarding the development of better quality customer relationships.
However, few sales organisations have changed their systems to reward customer relationships. This is partly because of resistance to change, and partly because they are not sure how they should measure such relationships. Assessing relationships will always involve a subjective element, but new measures have been developed to assist relationship development.
Most relationships do not develop beyond these basic types:
Social – based on having fun. A relationship driven by entertaining, which has the lowest return on investment of any relationship. Often seen as the easiest place to start a new relationship, but the hardest to shift to a relationship of significant value to the sales organisation.
Technical – based on the quality of the product or service, and nothing more. The most dangerous relationship. Traditional measures of a sales organisation only measure revenue, and this can give the false impression that everything is going well. This being the most common relationship, there is a sudden and painful surprise when everything stops, usually because there was an instance of technical failure, or because a competitor built a partner relationship.
Ad hoc – A reactive relationship. The customer buys the product or service when he or she has an imminent need. The customer initiates contact, and the sales organisation reacts. This can be a very pleasant surprise, and there can be significant revenues.
However, it may involve a proposal, and price may well be a critical factor, so profitability may be questionable. The sales organisation has no certainty of how many opportunities it is missing.
Partner – The hallowed goal. This is a relationship where the customer trusts the salesperson totally. It doesn’t matter what the salesperson is selling – the customer would buy from that person because he or she is trustworthy.
The customer actively refers other customers to you, and customers seek your counsel on topics in respect of which you are not an expert. There’s a significantly reduced focus on cost.
The strength of a relationship is determined by the extent to which your behaviour will come across to the customer as trustworthy – how much you appear to be genuinely helping the customer achieve his or her desired outcomes.
The measurement of relationship capital allows salespeople to assess their customers so that they and their potential employers can take a qualitative view of their relationships.
This helps sales organisations to:
1. Recruit salespeople who have the right type of relationship with the right people to help the potential employer’s organisation.
2. Provide relationship growth targets for sales people.
3. Reward relationship growth.
There is still an element of subjectivity involved, but it is being removed as technology and psychology interact more closely.
If sales organisations are to genuinely move to a relationship path, they need systems that measure business-to-business relationships.
The following variables can be used to determine whether the relationship between sales and customer organisations is ideal.
l The role and position of each person.
l How influential each person is at the customer organisation.
l How strong each relationship is between a salesperson and each customer.
l Touch points – how many people at the customer organisation have relationships with people from the sales organisation.
l Depth – how many people from the sales organisation have a relationship with each of the key people at the customer organisation.
To measure the “security” of the sales organisation to customer organisation relationship, the sales organisation should determine what its ideal situation is regarding all the above. It should then measure the current reality. That, then, allows for plans and strategies to move to where they want to be.
l Keith Dugdale is one of the co-authors of Smarter Selling and the founder of the Smarter Selling Programme – The IOWEU Approach.
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