Companies today are going through a big game change. The fiat currency regime created easy credit and low risk premiums and a global, efficient credit market. Many companies have been able to surf on the demand from emerging markets for a long time. Everyone has found capital to fund this demand without lots of efforts. This is now changing dramatically. The easy credit is gone, the risk premiums are sky rocketing and the global credit becomes local. This is a game changer no doubt. So what does this mean? No one can know but some may have good strategic understanding of its markets and can give guidelines of course. However one thing will be crucial – to survive one must focus on the clients. You can loose anything else as long as you keep your customer base intact. Trust me, I know.
The common management paradigm “Our people is our key resource” I have never understood. I do not mean that the staff is unimportant, definitely not, we are crucial for the result and our well being and motivation and competence guarantees it. However the staff is the company, not a resource. No, instead the clients are the only truly valuable resource for the company and its biggest asset.
I meet with many executives in large operations and only a few really focus all they do on the wellbeing of the clients and on how to grow revenue by adding more clients and value components. Growth has mostly been anticipated and expected to happen automatically if the GDP grows and the brand is sufficiently strong. This is where I believe the game changer is coming. To survive this downturn you need to make the whole enterprise client centric in its truest sense. I do not mean to only say it but actually making the customer the KING and QUEEN. If you understand what I mean you also know it is not easy – it is changing the whole company’s attitude. When did you last time attend a meeting asking yourselves “How does our decision affect our clients?”
Client centric is not only product oriented. Many products (e.g. trucks, white goods, cars) are not the different from those of the competitors. The key differentiator lies instead in the service levels and treatment of the customers. And that is not only the service organizations responsibility if you want to stand out. It is a matter of corporate culture. Product quality is a pre requisite only, service quality is the differentiator. We do need to have the whole company focusing on creating superior client value each and every day.
You may think: “Wait a second, Magnus, we are the treasury. This does not apply to us?” I would disagree, strongly. The treasury has to be part of the core business and be worrying about client value generation in the same way as the rest of the company. How to impose client focus if you let some functions escape? That is not possible – you will fail. The question is instead how the treasury can assist in creating and improving the client value? What strategic initiatives can treasury take? How should you organize and integrate treasury in the core operations? What technology shall you use and how? How can treasury improve your company’s competiveness? Let’s think about that, shall we?
The common management paradigm “Our people is our key resource” I have never understood. I do not mean that the staff is unimportant, definitely not, we are crucial for the result and our well being and motivation and competence guarantees it. However the staff is the company, not a resource. No, instead the clients are the only truly valuable resource for the company and its biggest asset.
I meet with many executives in large operations and only a few really focus all they do on the wellbeing of the clients and on how to grow revenue by adding more clients and value components. Growth has mostly been anticipated and expected to happen automatically if the GDP grows and the brand is sufficiently strong. This is where I believe the game changer is coming. To survive this downturn you need to make the whole enterprise client centric in its truest sense. I do not mean to only say it but actually making the customer the KING and QUEEN. If you understand what I mean you also know it is not easy – it is changing the whole company’s attitude. When did you last time attend a meeting asking yourselves “How does our decision affect our clients?”
Client centric is not only product oriented. Many products (e.g. trucks, white goods, cars) are not the different from those of the competitors. The key differentiator lies instead in the service levels and treatment of the customers. And that is not only the service organizations responsibility if you want to stand out. It is a matter of corporate culture. Product quality is a pre requisite only, service quality is the differentiator. We do need to have the whole company focusing on creating superior client value each and every day.
You may think: “Wait a second, Magnus, we are the treasury. This does not apply to us?” I would disagree, strongly. The treasury has to be part of the core business and be worrying about client value generation in the same way as the rest of the company. How to impose client focus if you let some functions escape? That is not possible – you will fail. The question is instead how the treasury can assist in creating and improving the client value? What strategic initiatives can treasury take? How should you organize and integrate treasury in the core operations? What technology shall you use and how? How can treasury improve your company’s competiveness? Let’s think about that, shall we?
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