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Relationships Strong Enough to Survive
Big or small, they can deliver real business value.
Posted Jul 28, 2009
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Whatever your industry, your customers are most likely delaying projects and looking for ways to cut costs.

This is a good time to take stock of the relationship-building capabilities of your team. Are current relationships strong enough to withstand the destructive pressures of today's tough economic environment? Do your salespeople know how to leverage personal assets and the assets of your company to "competitor-proof" their customer relationships? To build enduring connections with customers requires two distinctive kinds of skills focused on two distinctive kinds of relationships.

The Importance of "little r" Relationships

The first type of relationship is based on interpersonal connections between members of a sales team and members of a buying team. These relationships might be thought of as "little r" connections. They are founded on a salesperson's ability to demonstrate trustworthiness, competence, and credibility as a business consultant and advisor. Customers who are assured of reliability learn to count on their trusted representative to protect their interests, respond quickly to help meet special needs, and offer reliable business results. Customers become highly averse to risking the loss of these payoffs, and are inclined to resist offers of discounts and price cuts from competing vendors. Even when individual contacts are restrained by budget cuts, they will remember and return to doing business with people they know and trust.

Even one or two "little r" relationships have value, but the real relationship benefit occurs when sales representatives develop a whole network of connections with the right people in the customer organization. With a wide range of contacts who view the sales representative as a trusted business partner, inside information will be shared, and contacts step up as champions, advocates, and coaches. The salesperson will receive advance notice of opportunities and get critical "heads up" notifications when potential decisions could adversely affect a sale.

On the flip side, if these relationships are weak, or have eroded as a result of subpar performance, they offer no protection against competitive encroachment. In the worst cases, where deadlines have been missed or customer concerns left unaddressed, a poor relationship can actually open the door to competitors.

Extraordinary "little r" relationships require your sales team to:

  • establish professional credibility;
  • build trust;
  • demonstrate the value of a relationship with every customer, on every call;
  • exercise a high level of skill in identifying the right people to contact; and
  • be fully engaged in (and capable of learning more about) each customer's personal and business issues.

The Value of "Big R" Relationships

As important as "little r" relationships are, they can be vulnerable to promotions, reorganizations, and downsizing. An even more powerful and compelling relationship is the one that exists at the level of business-to-business -- a different type of bond we can call a "Big R" relationship. These connections are based on business benefits that are highly valued because they are aligned with the customer's corporate strategy, goals, and critical success factors.

Take, for example, a company that provides its customers with complex high-tech solutions. With regard to the supplier of a critical component of its offering, this company may be very concerned about the supplier's research-and-development efforts and technical capabilities. Because "Big R" buyers are often facing longer time horizons and higher risks, they want to understand the supplier's marketing and product strategy, and they depend on the supplier's stability.

Though not every customer interaction has the potential for developing into a "Big R" relationship, your sales team needs to know how to identify these highly valuable customers, assess their potential, and establish the "Big R" relationship where appropriate. This requires business acumen and the ability to gather and process both internal and external information. Specifically, the sales team must develop the capabilities needed to:

  • fully understand the customer's solutions;
  • analyze the customer's marketplace and business strategy;
  • gain a clear understanding of the customer's business processes; and
  • verify and articulate the customer's long-term goals and the priorities driving decision-making from the top of that customer's organization.

The next step is to know how to create alignment between the way these select customers are doing business and the way your company does business with them.

The Competitive Advantages of "little r" and "Big R" Relationships

Today, every company is looking for an edge that will open the doors to new business and serve as a protection against erosion of market share. While some focus on renewed attempts to differentiate a product offering, others talk about "building the brand," and a handful struggle to price-cut their way to a better revenue stream. These strategies can't work for every company -- only a lucky few are able to achieve truly sustainable differentiation, for example, and of course only one firm can be the lowest-cost provider in its category.

On the other hand, strong and enduring relationships are not dependent on product features that others can duplicate or price cuts that can hurt the seller's bottom line. Rather, both "little r" and "Big R" relationships offer a unique competitive advantage by delivering real business value deriving from the relationship itself rather than from a product or a price. The ability of a sales team to leverage interpersonal connections and corporate business alignment becomes the best and most-reliable resource for maintaining current market share and driving growth, even in an unpredictable and chaotic economic environment.

About the Author

As executive vice president of Wilson Learning, Ed Emde drives sales, marketing, and service strategy in the Americas. Emde's 20-plus years of experience includes prior executive and management positions with several of the leading training and organizational development companies in the industry. He has been instrumental in helping organizations to leverage their human performance assets to advance their competitiveness.

Please note that the Viewpoints listed in CRM magazine and appearing on destinationCRM.com represent the perspective of the authors, and not necessarily those of the magazine or its editors. You may leave a public comment regarding this article by clicking on "Comments" at the top.
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For the rest of the July 2009 issue of CRM magazine please click here.

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To contact the editors, please email editor@destinationCRM.com
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