Delivering with quality and speed may require ‘co-opetition’
One of the few business observations that’s true across virtually all industries is that customer habits have changed dramatically over the past three years.
- Customers have become much more comfortable as digital consumers.
- They have grown accustomed to having goods and services delivered right to their door in a very short time after placing an order.
- After experiencing sky-high inflation throughout most of 2022, customers also are used to paying significantly higher prices for many goods and services than they did just a few years ago.
All these new customer behaviors and expectations have significant implications for businesses as they pursue organic growth, according to Chris Smith, Grant Thornton LLP’s Chief Strategy Officer. Smith said business leaders need to take a new look at their customers’ needs and how they can be met at the right price and margin points.
Smith said companies need to learn how to deliver on what he calls the “culture of now” that has emerged with customers in all industries. The days of asking customers to be patient are gone. Brands that can’t service customers immediately are being replaced by brands with breathtaking speed of delivery.
“This culture of now has completely permeated B2B, B2C,” Smith said. “Even inside companies, employees want their performance review now. They want their raise now if they’re doing something successfully. This whole, ‘Now, now, now,’ is very pervasive.”
Smith said some organizations are finding that they need to cooperate with their competitors to deliver in a manner that satisfies their customers.
5:12 | Transcript
Keep an open mind
Partnering may be the answer
Company leaders can be particularly averse to participation in co-opetition, where companies partner with traditional competitors to accomplish customer fulfillment tasks that are beyond their own core competencies.
Sometimes, Smith said, companies have to experience failure outside their core competencies before they’re receptive to the idea of co-opetition.
“If they’ve tried to expand vertically or horizontally to complete the next stage of the experience and it goes horribly wrong, it’s easier to talk about, ‘Just be great at the thing that you’re great at and partner for the other things,’” Smith said.
Meanwhile, at a time when customer brand identification is fickle, companies are focusing efforts on getting customers to use their product more and even leading them to the right solution if it’s outside the organization.
This shift to align strategy with customer needs may result in a misalignment with employee expectations, which requires addressing by leadership.
4:21 | Transcript
A delicate task
Employee engagement is critical
Some shifting of internal resources may be required to enable the shift to a strategy based on customer retention. Performing that restructuring while retaining the buy-in of employees in a competitive talent environment can be a delicate task that requires a careful balancing of the needs of customers and the workforce.
This can affect various functions within an organization, and a shift in operating models may be necessary to match customer preferences with operations and ultimately employee desires.
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