Maintaining a well-balanced customer portfolio that supports a recalibrated business plan can be challenging.
Last month’s blog, Is it time to recalibrate your business plan?, addressed the importance of recalibrating the business plan and sharing its details throughout the organization. When customer lifecycle management focuses on integrating the company’s business plan with an ideal customer portfolio, the outcome is purposeful and dramatic.
Identify and retire products and customers that no longer align with the company’s business plan.
As market dynamics evolve, customer expectations change, and new product requirements emerge. The ability to generate profitable revenue and solidify the longevity of ideal customer relationships is vital for the success of a recalibrated business plan. As leadership updates the business plan, they may elect to retire products or service offerings that are using up profits and are no longer viable to support the new strategy. Achieving this goal may require short-term changes to products and services while the business simultaneously invests in new development.
Managing the retirement of products that support current customers’ business objectives can be challenging for business relationship management teams. Consider that customers have specific goals and objectives that draw them to the company’s existing product and service offerings. Not all current customers will have interest in the new products in the company’s innovation pipeline. With planning, collaboration, and effective management, existing customers who embrace the new products and service offerings can become future brand ambassadors.
Conduct analytics and develop champions to support the desired customer portfolio.
The team managing customer relationships must be knowledgeable about the business plan to successfully manage their books of business against the plan’s goals. It is essential to conduct periodic reviews of the customer portfolio to identify business relationships that support the company’s short- and longer-term plans.
The business relationship management staff, with support from the financial analytics staff, are the best qualified to provide the portfolio analysis. The customer portfolio should evolve, reflecting the business’s current and desired future state. Creating awareness with customer relationship management teams regarding required changes in the customer portfolio – including timelines to achieve business objectives short and longer term – is imperative for the success of the plan. Collaborating and communicating with the business relationship managers is important to develop champions who support the new business plan.
The results of the customer portfolio analysis may indicate the need to dissolve targeted customer relationships as your leadership team recalibrates the business to focus on more innovative products leading to a new portfolio of customers. Requiring business relationship management teams to retire targeted customers within their books of business can be tough to execute.
Business relationship management teams typically focus on customer retention and organic growth. The staff has specific revenue targets associated with their compensation. Asking them to dissolve segments of their existing pipeline and begin to focus on new products and services offerings while retiring current customer relationships can impact their compensation. Collaboration complimented with insight into new product launches is important for the timely execution of the plan.
Communicating with the sales organization regarding the new business plan, strategy, and revised ideal customer profiles is a crucial step in redefining the future state of the customer portfolio. Remember, customer lifecycle management begins with sales. It starts with the handshake. As new customers are onboarded, the business relationship managers can appropriately manage their evolving books of business to drive profitable business and a well-balanced customer portfolio supporting the desired future state of the business.
It’s about communication and creating awareness. It’s about developing champions.
It’s about leadership – It’s about you!
