Problem:
Based on the Smith Systems scenario below, answer the following questions: What are some possible solutions to the scenario? What are your assumptions and constraints? Can you let them go? What are some best case solutions?
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Smith Systems Consulting (SSC) is a B2B provider of web and business application services. The services focus on three areas: networks, applications and web sites.
Sam Smith, founder and CEO of SSC is concerned about customer acquisition and retention. To date, SSC has done everything possible to avoid losing a client, but Sam is now questioning whether or not all clients should be treated the same. Since it's founding in 1994, SSC has been profitable, but has not kept records of profitability on each client. Currently, SSC's largest income clients are Huffman Trucking, Kudler Foods, Riordan Manufacturing and McBride Financial Services. Last year, McBride threatened to drop SSC as a preferred supplier. The sales and marketing teams created a "turbo charge" process to ensure McBride stayed with SSC.
Sam is now questioning whether or not the cost in terms of time, money and resource allocation was worth the result. The web business has become more competitive with many more companies now competing for customers. SSC is finding that it is becoming more difficult to attract new customers and retain existing customers.
The SSC management team sees an increase in competition from the larger companies, but the team believes as a smaller company they can provide better service to their customers. They are not sure which of the services they provide are most cost effective for them and most valued by their customers. SSC has not defined their ideal customer.
SSC does not have as many newer clients. Although the newer ones tend be larger accounts with relationships across the organization. The problem is that while the accounts may be larger, the relationships are shorter. The Finance & Accounting Manager wants to review the profitability of each customer but the COO and Customer Service Manager of sales believe every customer is a valuable customer.
Sam is planning to retire in the next few years. While the company has grown, many long-term customers still associate the company with the founder. The long-term customers often call Sam directly for assistance and service.
Since Sam Smith may be leaving, it seems to be an ideal time to prepare for what the company will look like without its founder. The Director of Marketing believes they need to evaluate their marketplace, the trends and the competition. The Finance & Accounting Manager feels they need to focus on profitability before service. The Customer Service Manager of customer service wants to focus on retaining existing customers while the Customer Service Manager of sales wants to focus on selling new accounts and penetrating deeper into existing accounts. Everyone agrees their brand could suffer with the retirement of Sam but they are not sure of the impact or how to handle Sam's retirement. The Senior Officers have equity in the company. The Customer Service Manager level participates in profit-sharing.
The management team wants to explore new ways to reach customers and prospects. Advertising has become too expensive. Tradeshows cost require a big investment of time and money but do not always reach the target audience.
The senior team has gathered for an off-site meeting to review their current state and to map out future plans. Over the next few days they plan to understand where they are, where they want to be and how they will start to reach their goals. In preparation for the planning meeting and comprehensive customer satisfaction survey has been completed. The results will be shared at the meeting in a SWOT analysis.
Sam wants to leave the meeting with at least the beginnings of a customer acquisition and retention strategy.