The Age of the Internet: Business Solutions for the Future
CUSTOMER CARE The cost of acquiring new customers greatly exceeds the cost of retaining existing ones. As a result, in the age of the Internet, business is all about the customer. With increasing competition, companies need to unify customer communication across all functions.
Challenge
Today's customer is more sophisticated - and more demanding - than ever before. Customers expect to be able to conduct product research, place orders, check order status, customize orders, and investigate new products and services - 24x7. Customer loyalty in general is low, while retaining customers is critical to profitability:
a mere 5% reduction in customer defections increases company profits by 25%-85% (Harvard University study by Fredereich F. Reichheld and W. Earl Sasser)
if companies continue to provide poor service levels on their Web sites, they could lose more than $63 billion in potential revenues in 2004 (Datamonitor).
Solution
A new business model that emphasizes a customer's lifetime value. Organisations are executing this model by integrating new Internet initiatives and Web-based applications, including:
Interaction technologies to allow customers to interactively communicate with the enterprise (cobrowsing, chat, e-mail management, and legacy interactive voice response)
Communication enablers permitting data to physically and logically flow across multiple media
Network/intelligent network services to provide a flexible, secure, reliable, and scalable network infrastructure that supports data, voice, and video communications.
Benefits
Companies that incorporate customer care solutions into fundamental business processes reap many benefits, including:
Integrating customer interactions across marketing, sales, e-commerce, fulfillment, billing and provisioning, service, learning, and online communities
Creating a flexible, effective channel for communicating with existing and prospective customers
Reacting quickly to changing customers needs and increasing brand awareness
Maintaining order processing and customer support at a steady headcount despite an increasing customer base
Reducing the time for handling orders and resolving customer issues
Moving transactions away from agents to automated fulfillment.
SUPPLY CHAIN MANAGEMENT Staying competitive requires transforming the supply chain-sourcing and procurement, production scheduling, order fulfillment, inventory management, and customer care-from a cost-based back-office exercise to a flexible operation designed to effectively address today's challenges. The Internet is proving an effective tool in achieving this.
Challenge
Increasing customer demands, competition, and rising development costs are changing the face of business in the Internet economy. Companies are now attempting to reinvent themselves to meet ever-tightening lead times and higher customer expectations. A successful, customer-centric supply chain must fulfill delivery promises, ensure uninterrupted supply and squeeze the costs from internal processes.
Solution
Developing and implementing a networked, flexible supply chain that integrates all partners into a seamless unit is the first step in meeting ongoing customer demand and maintaining a competitive edge. In doing so, companies transform their supply chain from a cost-based back-office exercise into a flexible operation designed to effectively address today's challenges.
Benefits
Innovative companies that implement supply-chain management techniques are realizing a number of key benefits, including:
Cost reductions in inventory management, transportation and warehousing, and packaging
Enhanced customer satisfaction through online order entry and configuration
Improved service through techniques such as time-based delivery and make-to-order
Enhanced revenues, thanks to higher product availability and greater product customization
Reduced product-cycle times
Increased market share due to shorter engineering-to-production cycle times
Flexibility to design, market, and retire products more rapidly
Ability to sustain product quality while outsourcing major portions of the fulfillment process.
WORKPLACE OPTIMISATION Using the Internet enables organisations to improve employee productivity and satisfaction, create operational efficiencies, and reduce cost (and enables employees to focus on the core value of their jobs).
Challenge
To create an informed, empowered workforce-one that has the knowledge and the tools to make both tactical and strategic decisions and to act on them. And to avoid increasing support staff proportionally as the business grows (resulting in a costly, administrative-heavy organisation that is unable to rapidly respond to changing market conditions).
Solution
Incorporating Web-based tools, rather than more personnel, into the infrastructure design. A productive workforce depends on easily accessible information, whether it is corporate administrative information that saves an employee time, or market knowledge that can improve employee-customer interaction. Web-based company systems provide workers with the dynamic information they need to make better decisions in a timely way.
Benefits
Workforce optimization tools deliver tactical and strategic benefits to both employers and employees:
Reduce costs by simplifying and automating routine administrative tasks, so your employees can focus on more strategic tasks that generate revenue.
Empower employees so they can react dynamically. In customer-facing roles, for example, empowered employees can dramatically improve customer interaction quality by promptly and knowledgeably addressing issues.
Improved productivity by deploying technology -instead of people- to audit and control administrative processes, resulting in improved employee satisfaction, and faster, more accurate transactions.
What's your IQ Net Readiness?
Drawing on experience with Fortune 1000 executives, Cisco developed an analysis tool designed to assess an organisation's ability to migrate to an Internet Business model. The iQ Net Readiness Scorecard is comprised of a series of Internet Business related statements that require judgment responses. Take the test at:
www.cisco.com/warp/public/779/ibs/netreadiness/20question.html
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