High-Performers Focus on Customers

ALMOST ALL contractors complain that they are already doing great in their operations, but they need more sales and marketing. Some even go a step further and suggest life would be wonderful if it werent for those darn customers! In most cases what the contractor actually needs is not more marketing but more customer focus. In todays market, everyone is looking for a differentiator. Having a world-class

ALMOST ALL contractors complain that they are already doing great in their operations, but they need more sales and marketing. Some even go a step further and suggest life would be wonderful if it weren’t for those darn customers! In most cases what the contractor actually needs is not more marketing but more customer focus.

In today’s market, everyone is looking for a differentiator. Having a world-class way of working with one’s customers is what sets the High-Performing Contractors apart from the rest.

The HPC views his customers differently. When he sees a potential or existing customer, he sees a relationship for life with changing needs that must be understood and fulfilled as well as communications that must remain current and open. He doesn’t see a customer as another sales conquest or a pain in the backside. Employees react to customers the way their managers see them.

High-Performing Contractors don’t want satisfied customers, they want loyal customers. What’s the difference? A satisfied customer is an opinion; a loyal customer is a behavior. A loyal customer gives us the next job! The pathway to loyal customers includes getting the requirements right upfront, establishing a trusting relationship, managing that relationship to keep the customers for life and measuring loyalty to ensure loyalty.

The HPC understands the customer’s specifications and requirements. Specifications are what the customer formally says he wants. Requirements may be perceived or spoken and represent what the customer expects the job to accomplish. The HPC goes beyond meeting specifications to make sure he meets the customer’s requirements.

In contracting, we waste money in bidding jobs we never get. Most contractors say they are successful on bids about 20% to 30% of the time and feel good about it. That means that 70% to 80% of their bidding resources are wasted! The HPC puts in place and uses systems to help achieve much higher bid success rates. These systems include:

  • Ways to communicate and meet with the customers routinely to “listen” to their needs and concerns and not to “sell” the customer. High-Performing Contractors have developed ways to translate the customer’s ideas of their needs into the contractor’s language. Customers are not always knowledgeable in the language of construction. The HPC listens through pre-job walks and post-project reviews with the customer. He listens to the customer’s complaints to hear not only what is said, but also what is really said between the lines.
  • Methods to capture and analyze the competition. All successful contractors know their competition. The HPC has ways of turning general knowledge into facts for analysis.
  • Ways to involve the operations people in the bidding process so that they build it the way they planned it and they build it the way the customer valued it.
  • Working hard and smart to keep his customers and to manage relationships. The term “relationships” as used here does not mean golf outings or fishing trips with the customer. It is referring to “business” relationships. It costs about five times as much to get a new customer as to keep an existing customer.

The most basic and critical way to maintain loyal customers is to deliver the job as promised.

The HPC performs as promised and communicates in a timely manner. This is the foundation of his customer focus. Great performance on the job can lead to a great relationship. Mediocre performance, even coupled with great marketing, will not lead to a great customer relationship.

  • The HPC develops and uses a formal complaint system, which is used not only to ensure that any customer complaint is resolved in a timely manner, but also to see where opportunities lie to better meet customer needs and expectations that were not clearly spelled out in the specifications. Complaints mean the customer is still trying to work with the contractor.
  • Another method used by the HPC is alliances, teaming or partnering. While the term “partnering” has taken on some legal and even negative meanings, the HPC works with the customer and other trades and suppliers to get everyone on the same side of the table to address problems and job productivity opportunities. These teaming or alliance relationships are built on trust and work to achieve mutual goals.
  • The HPC trains his employees in how to provide excellent customer services to make sure they manage customer relationships by design. This training teaches employees how to create a positive experience for the customer, how to listen and resolve complaints and how to make customer-related decisions in order to keep the customer for life.

One contractor uses a “green sheet” to define its customers in detail. The sheet helps identify the customer’s key players and their decision-making and influence roles. This analysis identifies needs and areas of interest, and where the contractor stands with each player compared to the competition. This contractor has created a system of asking and answering questions about the customer. The process clearly points out the company’s relationship and areas of opportunity with each customer.

l Measuring customer loyalty is an important part of customer focus. These contractors are not satisfied with gut feel when it comes to getting feedback from a customer. They measure loyalty the good old-fashioned way — they ask for it. They do satisfaction surveys at the end of jobs and regularly throughout the year.

The HPC looks for his standing with his customers the way most contractors look at their financial statements. The customer perception surveys are not marketing attempts, but they ask questions about how the contractor met the customer’s needs, which needs are most important to the customer and how the contractor compares to the competition.

The HPC shares satisfaction survey results with employees and uses it to drive improvement. He also measures other signs of customer loyalty such as lost customers, the percentage of the customers’ work that he won and the number of referrals by customers.

In summary, the HPC has systems and methods in place to listen and respond to his customers’ needs and expectations so that his company can constantly improve on its world-class service.

Dr. Myron Tribus may have said it best about having loyal customers:

“Quality is what makes it possible for your customers to have a love affair with your product or service. Telling little white lies, decreasing the price, adding novel features, can create a temporary infatuation.

“Love is always fickle. Therefore, it is necessary to remain close to the person whose loyalty you wish to retain. You must be alert, ever searching for what pleases customers. The wooing is never done; constant improvement is required to keep loyal customers.”

High-Performing Contractors understand and live this better than their competition.

More management articles by Dennis Sowards