New Directions in Vendor Relationship Management: A Customer-Centric Approach

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Chris O'Brien, Marketing Communications WriterClothes that remember the last time you wore them? Phone apps that work together to schedule travel, create budgets, and send reminders? These concepts  are certainly still in the future, but they are a future closer than we might imagine, as Doc Searls discusses in his book “The Intention Economy” and Wall Street Journal article.

These updates in technology are the result of a changing focus in how companies interact with customers. Customer empowerment, Searls says, started with the PC, gained power with the Internet, and is finally becoming a hand-held solution with smartphones. As customers, we constantly expect more from companies, from increased data privacy to more mobile options. These expectations are driving the marketplace to provide more personalized solutions.

While some companies still think of customers as targets to be won, the next wave of successful companies will be those actively empowering customers. 

Vendor relationship management, or VRM, is a new field that aims to do just that. Imagine a system where you could update contact information with all of your preferred businesses at one time, rather than updating it at each individual website. Likewise, fully automated systems would allow you to only search for those companies that have the same terms of engagement and privacy that you require. VRM is about putting customers at the same level as vendors and other organizations in the business cycle.

Companies that allow customers to participate in the business cycle are uniquely aligned to learn from and grow with their customer base.

Searls imagines a world in which customers instantly reach out to companies when an object is broken to compare prices for rental, repair, and replacement. Further, he sees phone apps that tie together services from different companies into one seamless system that can fill out expense reports, issue reminders, and make reservations.

This new focus allows companies to learn from and collaborate with customers in a way that had not been possible before. Rather than acting as constraints, these new expectations allow companies to provide better solutions and products to their customers at every stage of the business process.

Consider how you work with customers in your business now. How are you working toward better ways of actively incorporating customer feedback and expectations into your business?

Chris O'Brien