How companies get to do repeat business?

I work for an IT services company that makes over 90% of its revenue from repeat business.   For the last few days or so, I was thinking about the reasons how certain companies get to maintain long-lasting customer relationship and generate repeat business.  I wanted to delve a little deeper into this topic.

To start with, let us analyze this from a customer point of view.  Why do we regularly shop at one particular retail store over others?  The potential answers I could think of were:
1. Good quality products
2. High availability
3. Low prices
4. Good customer service
5. Ease of shopping
6. Location proximity

We can see that there are a number of factors that can contribute in enabling repeat business. Now, the important question is how companies are able to consistently do this.  It is difficult to do well in all of the above points.  Is it not?

After a little deeper thought, I could classify the above points into 3 focus buckets - i) Product differentiation, ii) Operational Excellence, and iii) Customer Experience.   So, successful companies, that do repeat business, will need to have hardcore focus on at least one of these 3 points and do their possible best on the remaining two.  Let us look at examples of few companies and confirm whether this analysis is true or not.

The first company that came to my mind is Apple which is known for its product differentiation. Apple products are also relatively expensive when compared to similar products from other companies.  Though, many customers are willing to pay a premium for the experience these products deliver.

The next company is Walmart.  I think Walmart's core strength is operational excellence.  They are able to ensure high availability of various products at lower prices with close location proximity to customers.  Customers of Walmart may not be too cost conscious as most of them have good confidence on the low price commitment from Walmart.

One company that delivers great customer experience is Amazon.  They are known for making shopping experience easy and pleasant.  Customer care and service is of primary importance.  I have seen the maximum number of shopping innovations around product pricing, shipping options, buying modes, shopping cart and loyalty at Amazon.

The 3 focus points - product differentiation, operational excellence and customer experience applies to services companies as well.  We can see that there are many other companies that are successful in delivering repeat business by leveraging these 3 focus points appropriately.      

I invite you to share your thoughts and comments on the above analysis.

Knowledge Management: To kill re-invention, improve quality and promote innovation

How does Knowledge Management complement Quality - is the core question of discussion for the ASQ bloggers, this month. Arun Hariharan, founder of The CPi Coach is the guest author of this thought provoking blog post focused on knowledge management.

In the blog post, Arun makes an interesting comment on Knowledge Management (KM) that it only kills re-invention and not innovation.  He says, KM must be available in an organized fashion to facilitate further knowledge creation within the organization and re-use of existing knowledge promotes innovation.  Modern companies carry out several KM initiatives for generating innovative ideas from employees.    These KM programs help institutionalize best practices and standardize business processes.   Excellence models such as Baldrige and EFQM highly value KM.  The synergy between KM and Quality is also clearly brought out as part of the blog post.

KM transformation will help in the improvement of quality of processes with in the organization and the products and services it offers to customers.  Modern organizations have started to reimagine their workplaces to institutionalize 'social' knowledge management as customers expect high quality across all aspects of products and services.

I have attempted below to discuss some recent trends that is helping organizations to transform knowledge management.

Many of the top organizations have created an enterprise social platform to enable collaboration, foster innovation and ideation and, subsequently, integrating them to business goals and objectives. True collaboration can be achieved only by breaking hierarchies and silos within the organization. Thus, creation of a flat organization structure leveraging social is a best solution option.  This type of social system actively promotes collaboration to create, dissipate and enable consumption of knowledge amongst various stakeholders.

To motivate employees and ensure regular participation, the collaboration platform is integrated with a gamification set up.  The real value of collaboration is achieved only when employees are intrinsically motivated and they compete to collaborate.   A carefully crafted gamification system comprising of badges, points and leaderboards is implemented.

Continuing the social journey, organizations have attempted to reduce top-down communication and rather promote multi-directional conversations.  When 2 parties within the organization are interacting, many others are directly listening and indirectly consuming the knowledge dissipated from these conversations.  This is the true power of an enterprise social platform that enables creation of an open culture for KM and is important for the next generation employees comprising of Gen Y, millennial and baby boomers.  

Crowdsourcing, an approach to resolve complex problems, is another interesting flavor of KM adopted by  modern organizations.  By leveraging a million minds - internal and external to the enterprise, organizations extract the best knowledge in an efficient manner.  The extracted knowledge is highly valuable and produces high quality solutions for the large and complex problems.

We can observe that KM is in the correct transformation path to address the needs of tomorrow's modern organizations and, in turn, enable them to deliver high quality products and services.

The Power of Social Media

The latest IT wave of digital is comprised of Social, Mobile, Analytics and Cloud known as SMAC, in short.  Some of us may wonder about the role of social in digital and it may appear to be an odd man out of S-M-A-C.

The reality is that social cuts across the digital forces - Mobile, Analytics and Cloud.    Let me explain.  We all know that mobile is the user facing entity and the access point.  When multiple users communicate via mobile, it becomes a social platform.  This platform generates a lot of data to help organizations derive analytics for their business intelligence.  The amount of data generated is so huge that it has to be stored on to a cloud data store.  So, social plays an important role as the integration element of SMAC.

Dr. Manu Vora has carefully chosen to write a blog post on "The Gift of Knowledge Transfer through Technology", a relevant topic for today's context.   Dr. Manu's post primarily talks about social collaboration via technologies such as Google Hangout and its direct and indirect benefits.  Based on Dr. Manu's experience, Google Hangout has various benefits. It is free and available to all, can connect a large number of participants, automatically record videos and post them to YouTube, conversations are available for offline reading etc. He has real experience of using social, in his projects, to improve knowledge, communication skills and creativity.   

But I believe that social has more power and I have attempted to list those additional characteristics - The 4Cs: 

a. Conversation - Traditional focus was always on communication - top-down or bottom-up and one-on-one or one-to-many.  With the advent of social, communication has become conversation - multi-directional and many-to-many.  Today when two people converse, many others get to listen, comment and contribute.   Take for example, a post in Facebook.  Many people that belong a network of the original poster can follow and contribute to the post.  Many times, conversations in Facebook get deeper on the topic of the post and also on the reach.  The power of social conversations is immense.

b. Collaboration - With social, task-based workplaces are replaced by collaborative workplaces. Teams collaborate to achieve a particular goal or an objective. The right team members voluntarily join hands with the focus of completion of goals and objectives.  For example, houzz.com is a collaborative way of designing the home.  In the earlier era, tasks were created and assigned to teams to get the work done.  

c. Crowdsourcing -  NASA has recently initiated a crowdsourcing effort to seek inputs on establishing sustained human presence on the planet Mars.  Let us imagine that there was no social concept, then how do you think NASA could carry out such an exercise.  Through crowdsourcing, organizations are able to perform huge tasks quickly and in a cost-effective manner with a strong innovation focus.  In olden days, huge tasks were always a challenge and many times impossible to do or complete.

d. Co-Innovation - The overarching characteristic of social is co-innovation.  Social provides a fantastic platform for everybody to join hands and innovate together.  The social platform can intrinsically motivate people to stay focused, develop novel ideas and also implement them in an efficient manner. Social platform helps in continuous improvement, a key attribute required to ensure quality.

Conversations, Collaboration and Crowdsourcing thus help organizations to Co-innovate leveraging the power of social.