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A blog in which our staff discuss current topics and trends in the IT business community and Internet culture. Includes news of interest and helpful tips for Canvas Dreams customers.
The Importance of Sustainable Business In Today's Economy (April 14, 2009)
Whenever the phrase "sustainability"
is used, more often than not it is said in the context of
environmental awareness. Less attention is given to the ways
sustainability can be applied exclusively within a business setting,
or the different ways it can surface in a company's day-to-day
activities.
In the past I have written about the importance of
customer service with regards to sustainability. I'd like to
refine this notion by breaking the general concept of "customer
service" into two components: KYC (Know Your Customer), the
manner in which a company constructs the relationship with the
customer; and QOS (Quality Of Service), the manner in which a company
provides its services and products to the customer and how the
delivery supports or hinders the relationship.
Given the
troubled economy, personal experiences dealing with poor service, and
recent national security news in the Web hosting industry, it seemed
a perfect time to explore what is going on right now, how companies
can learn from others' mistakes, and embrace sustainability in a way
to support their customers, grow their business, and protect their
company's image all at the same time.
KYC = Know Your
Customers
The first place I saw the phrase "know your
customer" was at a bank in 2002. They had just posted a policy
following then-recently-passed anti-terror legislation. The bank
wanted to get to know who you were so they could provide you better
service. The policies didn't necessarily mean the bank wanted to
restrict your business. It was more like a vetting process: As the
bank became more familiar with you, financial transactions would take
less time because the bank began to recognize patterns in your
legitimate day-to-day activities. One banker told me it simply meant
establishing a relationship with a customer to build a thing called
"trust".
Within the scope of the Internet, I often
hear about a poorly-used term, "Web 2.0". Instead of simply
browsing information, Web sites built around Web 2.0 concepts enable
you to provide feedback, interact with the site, add your own
opinions, and overall create a two-way conversation out of your
Internet usage. You can think of Web 2.0 as a form of KYC because it
removes anonymity from the picture and makes the entire experience
personal.
KYC is a simple philosophy that any business should
uphold. You cannot serve your customers' needs if you don't know who
they are. Despite the increased adoption of KYC, many companies --
particularly large corporations -- seem to have little interest or
ability to know anything beyond the dollar value of their customers.
They may perform an aggregate analysis to determine their customers'
demographics, general interests, purchasing habits and all that; but
if you were to ask what a particular customer did for a hobby, what
the weather is like in the customer's city, or if the customer's
child enjoyed their birthday party, the company would look back at
you with a blank stare.
Now enter the aspect of the current
economic climate, and it becomes even more apparent why a company
should know its customers. In this "buyer's market",
purchasers are extremely choosy about where they spend their money.
The can afford to be picky because of the sheer fact many companies
are hurting for business and can -- and should -- work harder to earn
the trust and business of new customers. Any company not prepared to
put out this effort will likely be passed over in lieu of a
competitor that understands what is at stake.
QOS = Quality
of Service
From the other side of the company's dealings
with a customer comes QOS. The value of the company's service or
product, how it is delivered to the customer, and how it is supported
should the customer have a problem.
One of the negatives
experiences I have had as a consumer in this economy stems from large
companies trying to reduce costs by scaling back or outsourcing
customer service. Service that used to be excellent is now par;
service that was mediocre at the start has now become quite poor. The
quality of customer service departments has become abhorrent. It is a
disappointing turn of events all capped off with impersonalized
customer service from support staff who do not care about your needs
and simply filling a chair to get a paycheck.
What is most
astounding is the way some companies choose to deal with business
customers, and I can draw on personal experience to illustrate this.
Last week, one of our vendors -- a Denver telephony company that
supplies SIP trunks for our VoIP service line -- demonstrated that
they apparently outsource their support to an Indian firm, do not
want to know anything about their customers, and apparently have
little concern about the quality of their service, either. What they
also don't know is that they are one of three vendors we work with
for this particular type of service, and after our experience, we
will not be conducting any further business with them.
After
debugging quality issues with some of the DIDs (direct inward dialed
phone numbers) for one of our customers, we determined the cause of
the issue was not with our phone servers, but instead the issue was
with the vendor supplying service for that number. After a dozen
exchanges with the support department, and us carefully spelling out
the lengths to which we had localized the issue as being on their
end, our vendor's support department tried to close the trouble
ticket twice with these two damning statements:
"We
suggest that you contact your equipment vendor for further
assistance. Sorry for any inconvenience."
"Unfortunately
there is nothing further we can do for you on our side. Again we're
sorry for any inconvenience."
Despite us proving the
issue was on their end, their service staff didn't care and just
wanted us to go away. The dismissive tone of their support department
did far more than show the vendor doesn't care about providing
service; it also demonstrated that this vendor is not going to last
very long in this environment, beginning with their loss of our
business. It took less than five minutes for a consensus of Canvas
Dreams management to fire the vendor.
KYC + QOS =
Sustainable Business
After our experience with the fired
vendor, we immediately rang up one of our other SIP suppliers, also
located in Denver. They were delighted to work with us and begin the
process of transferring our customers' phone numbers away from the
former vendor. We set up a temporary phone number through the new
vendor for our customer, and the vendor's customer service department
-- based in Denver, not India -- was happy to speak with us over the
phone and help us through a minor configuration issue.
After
having a wonderful chat with their service department, I thanked
them. We chatted a bit about the weather, and they wished us a "great
weekend". Service with a smile. This was the first time I had
spoken directly with anyone in their department, but hopefully it
will not be the last. Yes, you read that correctly -- I actually look
forward to the next time we need to ring them up and ask for
help.
This is what happens when you combine KYC and QOS. The
service is good to begin with, it is backed up with personalized
customer support, and you, the customer, are amazed. As a result of
our experience, this is a vendor that we'll continue working with,
and while we have other providers to choose from, their few minutes
of effort and care showed that this supplier wants to know us, they
take pride in their work, and they want to build a healthy business
relationship. They took care of us, so we are going to reciprocate
the relationship by providing them more business in the future.
When
a company achieves this level of harmonious balance, it is a perfect
example of sustainable business.
Sustainable Business =
Business Protection
Beyond fostering a healthy customer
relationship, knowing your customers and maintaining healthy
communication can also help protect your business. For example, you
can pro actively determine whether a potential or existing customer
is abiding by your terms of service, or abusing your service for
their own gain in such a way that could be detrimental to your
company's image or worse, its operation.
I can draw on a
startling article in the Washington Post straight out of our industry
-- Web hosting -- to illustrate this point. This past week, it was
discovered that a pro-Taliban Web site in operation for more than a
year was being hosted at ThePlanet, a large Web host in Houston,
Texas. ThePlanet said it had no knowledge that the group running the
site had Taliban connections. And yet, there it was, an extremist,
militant Web site touting U.S. and Allied deaths on a Web server
managed by an American company and on American soil.
The full
article can be read here (limited to subscribers):
Extremist
Web Sites Are Using U.S. Hosts
The New York Daily News has
a boiled-down version of the story here:
Taliban,
al-Qaeda other extremist and terrorist groups host their Web sites
within the U.S.
One can only imagine the ramifications of
this situation. As a customer of ThePlanet, the (pro-Taliban) group
agreed to ThePlanet's Acceptable Usage Policy (AUP), which clearly
states "Soliciting the performance of any illegal activity, even
if the activity is not performed." is strictly prohibited on the
part of the customer. Yet, for more than a year they had broken these
and other terms of service and still went unnoticed.
The only
reason ThePlanet learned of the group is that a third-party blogger
alerted them to the fact they were hosting the site. It stands to
reason that had they done background checks, passed the customer's
information through any number of anti-fraud services, but more
importantly simply gotten to know who it was that was renting server
space for $70 per month, ThePlanet could have declined doing business
with the Taliban group in the first place.
Certainly,
impersonalized service comes at a price to the supplier. Shady groups
can fly under the radar when purchasing service from a large company
that doesn't employ KYC. Just as domain registrars like Network
Solutions and GoDaddy refer to you by your "User ID", a
number-based account, large Web hosts like ThePlanet simply have too
many customers for them to be able to keep tabs on, let alone
establish any sort of relationship or active communication channel
with those customers.
It is an extreme example for sure, but
it illustrates the point that when a company fails to understand its
customer base on a personal level, it cannot count on its customers
to respect the company's policies. Anonymity goes both ways, and
either party is capable of abusing the other.
Sustainable
Business at Canvas Dreams
At Canvas Dreams, we employ KYC
and QOS from the very first communication with a prospective
customer. We don't simply try to know what the customer wants, we
also want to know the story behind the customer. This way, not only
can we better understand their business requirements, but we also
gain a window into their personality and business. We continue the
process throughout the sales process. Should they sign up, we
continue it by speaking with the customer on a first-name basis and
developing a friendly relationship of open communication.
It
takes little effort to employ a smidgen of humanity in the business
process. We make a point of following up with customer support
requests and do in fact return phone calls. Very few Web hosts do
this, but it's just one way we can bridge the communication gap in a
very personal, first-person way. It is a way of assuring our customer
that they have our attention and we are just one phone call away. As
we develop and foster the relationship, we begin to construct a
profile of the customer, take notes on things of interest to them,
and overall simply try to relate on a human level.
The method
is not only disarming for times when we receive an upset
communication from a customer who needs our help, but it is also a
fool-proof method of understanding what they are really doing with
their business. We do not employ this method to try and determine if
a lead is bogus or a potential threat, but a benefit of this method
is that we do gain a lot of knowledge into the customer's mindset and
which addresses those concerns at the same time.
Overall, it
is through a simple commitment to ensure that our customers' needs
are met at every step that we are able to put sustainability into
action and create a comprehensive, quality Web hosting service for
our customers and establish respectful relationships that will
last.
Conclusion
"Knowing your customer"
is a process that is gaining ground throughout service-based
industries. With little effort, a company can employ a few simple
ways to open two-way communication with a customer throughout the
lifetime of the relationship. When blended with caring customer
service, the quality of support can advance exponentially and set
that company apart from its competition.
Getting to know a
customer brings many benefits for vendor and customer alike.
Customers come to know the level of service they can count on and
truly trust the vendor. The vendor can learn to identify how best to
serve the customer and also facilitate the support process should
that customer need help. The vendor can also use this method to
protect the wellbeing of the company and the existing customer base
from potential risks. Ultimately, both vendor and customer can work
towards a sustainable relationship of trust and honesty that will
serve their respective needs for a very long time to come.
In
today's world, it is up to businesses to distinguish themselves in
their respective industry. It is those companies that put out the
effort and integrate KYC with a commitment to QOS, and together work
those into the larger model of sustainability with their day-to-day
operations, that will weather the current economic situation and
rocket ahead when everything starts picking back up. Those companies
that do not understand the value of these philosophies are
essentially turning their backs on their customers' needs, and are
likely experiencing lost sales right now in line with the economic
downturn.
Sustainable business doesn't happen overnight. It is
a never-ending process that involves many rounds of revisions. As the
owner of a business in this troubled economy, never before has it
been so important to listen to your customers and get to know who
they are, and be prepared to back up your claims and support your
customers through any problems they encounter with your products or
services. By adopting simple, honest methods, you can single-handedly
plot a sustainable path for your business that will safely see you
through this economic storm.
Thank you,
David
Anderson
Principal, Canvas Dreams, LLC
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