How do you assess customer relationship risk?
Finally, the email you’d been hoping for had arrived.
Written confirmation the multi-million-dollar two-year contract was your’s, and don’t forget the one-year option.
“We did it!” you shout to know one in particular. Jubilant with victory.
After eighteen months of careful laid strategic steps, you’d steered your organisation’s ship successfully into port. The draw bridge had been lowered and you were ready to take your first steps onto your new customer’s land.
“Finally, no competition for two years, I can relax.” you thought.
But can you?
Fast forward eighteen months and the partnership seemed to be ticking along nicely.
As the head of business development, your organisation was servicing the account well. There were no complaints from the c-suite. From either party. You were meeting your quarterly milestones and despite dicey economic times, you were confident your customer was satisfied. They were spending as promised.
While you hadn’t caught up with their c-suite for a while, you assumed your director’s had been. You were certain your one-year option would be taken up. There was no reason not to, after all.
With four months of the contract to go, you ask your director to contact the customer’s executive to “check in”.
“Sure, I haven’t spoken to them in ages,” he says.
This makes you nervous.
You weren’t prepared for the wrath which was about to ensue. It was bad. The person who signed off on your contract had resigned and you didn’t know.
“How’d we not know this guy left two week’s ago?” your director fumed. “His replacement is from their biggest competitor who’s in bed with our biggest competitor. How do we fill a bloody two million dollar hole???”
Panic engulfing your mind, you instantly regret not being closer to the c-suite relationships throughout the duration of the contract.
In your mind you’d ticked every requirement of the contract.
“They’ve never faulted our servicing,” you thought over and over, “surely that’s enough?”
No, it is not.
Customer engagement refers to our evolving commercial relationship. It is a continual, never ending process.
Customer service refers to how a customer interacts with our brand.
Both different and of equal importance.
This was a simple case study for a reason - the more complex the partnership the higher the risk.
The reality is, customer relationships run their course.
An organisation has a responsibility to be prepared for their conclusion with a robust pipeline and a timely conversion.
In this case studies instance, there were a number of tough lessons. To name a few:
Assumptions blind reality
Partnerships are designed to evolve
Growth requires continuous learning and a collaborative future vision
Customer service and engagement must be equal priorities
A team approach to c-suite relationship management ensures multiple perspectives, objectivity and minimises risk of oversight
An organisation must have a customer trust strategy to reflect the continuous calculation of trust by the customer
Regular partnership health checks incorporating service and engagement, are integral to strong partnership health
Customers are the gatekeepers of revenue. Without them, business dies.
What does your strategy look like to mitigate the risk of losing a customer?
Here are a few questions to get your planning started:
How would you define an at-risk customer relationship?
Do you see value in a customer risk committee in your organisation? What would it look like?
How would you describe your confidence in the management of and ability to evolve your most lucrative customer relationships?
How can you invest in the improvement of this capability in your organisation?
How do you calculate customer partnership health?
What is your strategy when you identify an at-risk customer relationship?
Your customer is your business’s lifeline. They are difficult to secure and very easy to lose.
The integrity of these relationships worthy of investment. How are you investing in your’s?
Let me know! I’d love to hear!
Peta
Creating masters of customer relationships | Sales Coach | Consultant
Speaker for Beyond Blue Australia on workplace well-being
Author of My Beautiful Mess - living with burnout & rediscovering me
If you’d like to explore how to reduce customer relationship risk in your organisation, reach out to Peta below.