Tuesday, November 26, 2013

Role Reversal on Personalized Service

Technology always changes the relationships between businesses and people, just as it does between people and between businesses. As we move into the final weeks before the New Year, it's worth considering how these changes affect us.

Two particular trends affect those of us who run small service businesses. Taken together, they represent a role reversal with regard to the large service organizations out there. We're becoming less "personalized" in our service while the big boys are becoming more personalized.

Ten years ago the big organizations couldn't compete with us on this score. We know our clients by name. We attend their BBQ parties. We send them thank you notes. We know the quirkiness of their servers and printers.

In the meantime, the big companies didn't know their customers except through some macro-level buying habits. They focused on transactions rather than people. Transactions might be money, but it might also be gigabits sold, contracts signed, boxes shipped, or licenses installed. In this equation, "people" are just names on a mailing list.

But now we are becoming more transaction-oriented while the large corporations are becoming more personalized. Interestingly enough, their move toward personalization is pushing us toward the transaction model with our clients. Here's what I mean.

Big service organizations are becoming more personalized because they can now gather massive amounts of data and attach very specific information to specific clients. Instead of dealing with big chunks of users based on zip code or age, these companies can drill down into very specific buying histories and patterns. They can serve up personalized experiences in real time.

The most obvious examples are in retail. Amazon is king of this. You bought the last three novels by this author. She's got a new out now. Shall we add that to your cart? At the grocery store, if you don't buy your favorite chips two weeks in a row, you might just find a discount coupon at the bottom of your receipt.

Meanwhile, we small service providers are finding that transactions are the wave of the future us. Just look at your Cost of Goods Sold:
- BDR Units
- Anti-Virus licenses
- Spam filter licenses
- Gigabits of storage
- RMM agents deployed
- Hosted mail boxes
- Web sites
- VOIP lines

Of course these things translate into units deployed, clients under service, cloud packages deployed, etc. Even the way we describe our businesses to each other has changed. "I have fifteen servers and 400 desktops on managed service."

Transactions. We deploy licenses during the month, get paid for them in real time, and pay just for what we use. When you deploy enough licenses, your cost drops from $1.10 per unit to $1.07. It's all about transactions.

If there's bad news for us, it's that we are moving into an era in which we no longer push or deliver the kind of personalized service we used to. Microsoft wants us all to sell Office 365 and make pennies per transaction. The only way to make that work is to have thousands of transactions.

In the meantime, companies like mine are offering our services to "strangers" all over the country because we're going to deliver them basic remote services that are 100% transaction based. They sign up and get service. Calls go to a help desk. And we only get involved when the job needs to be escalated. Ideally, most clients will never need that.

One of my favorite quotes is:

"The factory of the future will have only two employees, a man and a dog. The man will be there to feed the dog. The dog will be there to keep the man from touching the equipment." - Warren G. Bennis

We're heading in that direction.

The good news is that the big service organizations will never be able to compete with us on personalization. We can compete in some small way with transactions. But they can never actually "know" their clients. We still can - if we choose to.


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