How B2B Companies Put Customers Firstin Key Account Management /
We know from talking to B2B companies across all kinds of industries that most aren’t as customer-centric as they think they are. Turns out, companies know it, too.
B2B International conducted a survey of 266 B2B marketers across North America and Europe, and only 14% of respondents said their company was totally customer-centric, meaning “the customer experience was ingrained in the fabric of the company.”
Interestingly, the survey also found that building market share and driving innovation are the top business challenges related to growth.
We think these 2 things are closely related. Failure to really engage customers makes market share and innovation even more challenging. Conversely, when you put the customer at the core of your business, you set yourself up to drive market share and innovation. Market share for obvious reasons; innovation because when you’re in tune with customers, you’ll find they’re constantly telling you what they need. Innovation becomes an answer to a question, rather than an idea you have to generate from thin air.
True customer-centricity means the customer informs every decision you make. Here are 3 key examples:
- Structure around your customers, building business units around customer needs—and empowering them to deliver
- Design around your customers, looking at your product or services through their eyes to make sure it’s what they need or want
- Plan growth around your customers, carefully considering what they can support in addition to what you want to achieve
Let’s look at some real-world application of these insights using successful companies we admire.
Structure Around Your Customers
In 2010, Dell evolved from organizing around geographic segments to organizing around customer segments: Large enterprise, Public, and Small and Medium Business.
The move reflected a key insight about customers: That the type of business they ran was more important than where they ran it, especially when it came to anticipating and meeting customers’ unique needs.
By structuring this way, Dell empowered each business unit to respond with agility to the unique customer needs of its segment. Of course, as a large company, Dell has the option to structure in several different ways. If that doesn’t seem practical for your organization, you can always apply the insight on a smaller scale. In place of entire business units, you could use dedicated teams, or even individuals, whose job is to understand a certain customer segment exceptionally well. The key is also to empower that person/team/unit to deliver exceptionally well. All the customer understanding in the world won’t do any good if they aren’t set up to act on their knowledge.
Design Around Your Customers
Slack is a billion-dollar business used by teams and companies everywhere. And while it may seem like they skyrocketed to success (they did), there were a couple of key points along the way where they could have moved even faster, but chose not to. Why? Because they were busy getting and responding to customer feedback.
Slack began as an offshoot of another project—an in-house tool the team put together to help them work on something else entirely. But as time went on, they realized they had something interesting on their hands.
Their next step wasn’t to market it like crazy, or even keep hammering away at it internally. It was, as founder Stewart Butterfield told First Round Review, to get it into the hands of different kinds of customers, and view the product through outside eyes.
“We begged and cajoled our friends at other companies to try it out and give us feedback,” Butterfield recalls. They quickly learned that what had worked for smaller teams didn’t work nearly as well for larger teams—and they adjusted their product accordingly. Once they mastered functionality for a certain size team, they tested the product on more and bigger teams, collecting feedback at every step along the way.
In that way, the ideal Slack customer was integral to the design of Slack itself. This is a much different approach than sequestering your developers in an office somewhere so they can build a product and hope the customer uses it later. It takes time to weave in customer feedback as you go, but it’s worth it.
Although they didn’t call it a “beta” launch, the functionally beta launch of Slack lasted a full 6 months, which is relatively long in the tech startup world. Why? Because that’s how long it took them to get more feedback—and the feedback is what made it great.
The takeaway here is that as fast as Slack’s rise has been, relatively speaking, it could have been even faster at a few key moments—but it would have been at the expense of the final product. They stopped and made sure to look at the product through their customers’ eyes.
It’s an old idiom, but a true one: Slow and steady wins the race. If you’re chasing growth as fast as possible, at whatever cost, you won’t have time to pause and look at yourself through the eyes of the customer. A willingness to do so can make all the difference in building a product that truly makes customers’ lives better.
Plan Growth Around Your Customers
In one of our favorite episodes of “How I Built This” with Guy Roz, Patagonia founder Yvon Chouinard recounts an early mistake he made as founder and owner of a phenomenally successful company: He grew without regard to what customers could support.
“We were growing too fast,” Chouinard recalls. Patagonia was doubling almost every year in the late eighties, expanding capacity and hiring staff to match. Then came a year where they only grew 25%. Which is still a great number—but not if you’ve hired and built inventory for 50%.
“We decided to put ourselves on a growth program so that we would be in business a hundred years from now.” Now, says Chouinard, “I wait for the customer to tell us how much to make.”
Patagonia is, of course, a B2C company, but there’s an insight in Chouinard’s story that’s applicable to B2B companies, as well: Let the customer drive your growth.
As a B2B company, this means understanding what your customers are trying to achieve with their own business. It means tailoring your products and services to meet those needs, using constant feedback to do so. And it means projecting your own growth goals largely as a function of the organic growth your existing customers can support, assuming you are successful in helping them meet their needs.
Key Account Management as Customer-Centricity
In order to be truly customer-centric, you have to build internal structures designed to understand your customer, deliver on their needs, and measure their success so you can project and plan for your own success accordingly.
Key Account Management is a function you can establish within your organization to help tether cross-functional teams to a customer-centric approach. KAMs are dedicated to understanding customer’s needs and actively seeking customer feedback at every point in the relationship. KAMs build Action Plans designed to meet their customers’ big picture goals. And with the right technology in place, KAMs are able to measure customer progress in real time, while also tracking internal milestones. This helps them closely marry internal growth to customer success, so they can contribute to an overall forecasting approach that’s grounded in numbers your customers can support.
We hope it’s been helpful to see some real-life examples of companies internalizing and acting on true customer-centricity. We’d love to hear other examples from your own or other organizations.
To see how Kapta supports a truly customer-centric model by reinforcing customer knowledge, customer delivery, and real-time metrics, schedule a personal demo today.