FRAMINGHAM (07/06/2000) - You're running on Internet time these days, frantically keeping pace with new technology and your demanding B2B and B2C customers. But in your haste to keep up, you've got to remember the people who depend on you most--your users. E-business has increased not only external customer demands but also internal user demands. Users seem to have a growing need for IT to perform such miracles as rapid response, flexibility and instant applications.
Out of necessity, creative IT managers are using a broad set of techniques for managing or improving their internal customer relationships. These approaches can be formal--such as devoting one group to customer service or assigning IT account managers to key departments. They can also be very informal--for instance, holding launch parties and writing newsletters to spread the word about successful IT projects. Some CIOs have even used their companies' methods of promoting external customer relationships to improve internal relationships, as did Mark Endry, senior vice president and CIO at J.D. Edwards & Co. His program pairs senior IT people with business leaders to foster ongoing dialogue. This formal feedback loop helps curb the "What have you done for me lately?" syndrome. Others, who may lack the resources to set up elaborate in-house programs, can rely on more homegrown types of efforts.
What matters is not what method you use to manage customer relationships, but that you choose one. Read on for four distinct approaches to get you started.
1- TAKE A LOOK INSIDE Johns Manville CIO establishes a separate group within IT to manage customer relationships When Chan Pollock arrived at Johns Manville International in December 1998, he immediately realized that the distributed organizational structure of its IT group was not meeting end users' needs. The decentralized IT support people were accustomed to doing things their own way since there were no standardized procedures and technology. As a result, the $2.2 billion Denver-based building-materials manufacturer was suffering companywide because its business objectives were not chief in IT staffers' minds.
To remedy that situation, senior management charged its new CIO and vice president of IT with creating an IT strategy that would ultimately increase return on the company's technology investments and improve customer service. In May 1999 Pollock created a global shared services organization in IT. Not surprisingly, users were unhappy about losing their day-to-day support staff.
To mitigate their disappointment, Pollock established an IT business development group and assigned three of the company's major divisions its own business development manager (who, in essence, could be called a relationship manager) to work on critical business issues. John Shellenberger, director of business development and an eight-year IT veteran at Johns Manville, heads the group of relationship managers. The team reports to Shellenberger in the newly centralized IT group and has dotted-line responsibilities to the heads of the respective business units.
These business development managers devote themselves to meeting and exceeding their users' expectations. Instead of getting mired in daily support functions (a separate arm within IT does that), these dedicated managers keep close tabs on their customers' business imperatives and propose ways to meet those goals.
And they speak the language of business, not technology. "Our customers don't care what version of NT we run or whether it's SQL or Oracle," Pollock says.
"[The business development managers] take that technical jargon out of the conversation. They bring high-level technology solutions to the table and use terms businesspeople can understand."
Pollock admits that finding people with the right skills to be relationship managers was time-consuming. But, he adds, the results far outweigh that initial investment. The payoff has been "the relationships that the [IT department] has built with the businesses, the communication and the successes we've had," he says.
While having a separate group manage internal user relationships works well for Johns Manville, some experts say that such an approach can have its problems.
The biggest potential pitfall is thinking you can offload that function to someone else, says Michael Krauss, partner at Diamond Technology Partners, an e-business services firm in Chicago. "Customer service must be the responsibility of everyone in the IT department. CIOs must build a culture of customer service" that permeates an entire organization, he says.
However, Pollock believes that separating the strategic IT component from daily IT support is necessary to give the company's strategic needs adequate attention. "Before, when a [user] had a strategic IT need, [that person] would tell any IT person who would listen. It's hard for IT people to say no, so they would say yes and then the topic would get dropped," says Pollock.
A critical part of Shellenberger's plan was to have the business units work together and with IT's business development group when working on their e-business plans. Without IT's participation, "we would have had three different e-business strategies on three different time lines," says Shellenberger. "We've positioned this [e-business strategy] as a strategic effort that needs to be coordinated across all businesses. We couldn't maintain any momentum if we attacked this from three different directions."
Shellenberger tracks the group's effectiveness by meeting monthly with each business unit head and the corresponding IT business development person for an informal review. At these meetings, they discuss what the group has been talking about, has delivered and is planning to work on. They also talk about whether IT is meeting its service goals. To further ensure good customer service, Shellenberger plans to poll business users on their thoughts about the new structure. But Pollock and Shellenberger say they have witnessed the ultimate indication that they are serving customers well: Johns Manville continues to fund IT projects, and users aren't looking elsewhere for help. "We can look at the growth of applications and utilization of our services as an endorsement," says Shellenberger.
Both Pollock and Shellenberger agree that the hallmark of a customer-focused IT department is meaningful interaction. "We've learned we need to be great listeners," says Pollock. "We don't want to do anything that's going to stifle the dialogue."
2- TAKING CARE OF USERS J.D. Edwards CIO pampers users and closely monitors their happiness J.D. Edwards may be a technology company, but that doesn't mean its business side has always respected the IT department. In fact, five and a half years ago, when Mark Endry joined the $944 million Denver-based ERP software vendor as director of infrastructure, its IT department had a dubious reputation.
Business users believed the group was out to deploy technology for technology's sake. What's more, they believed that the reliability and performance of that technology were secondary to implementing the latest technology.
These problems stemmed from IT not being run as a business, recalls Endry, who has since been promoted to senior vice president and CIO. So he laid the foundation for a service-oriented culture to flourish among the members of his staff of 83 (which has since increased to 400). "We wanted our IT people to think of the other employees as their customers. I pounded that into their heads"--and into their wallets. He put more than half of the IT staff on a variable pay plan that linked compensation to customer satisfaction (which was measured in quarterly user surveys).
Then Endry set out to fix certain service problems, such as WAN outages, and he began upgrading such basic applications as e-mail. He did all of that by centralizing the IT group, which was dispersed throughout the company's various business units. "They were doing things according to local priority rather than what was best for the company as a whole," Endry says. "We needed a consistent approach."
Naturally, the business heads were less than pleased at giving up their dedicated support person. In fact, one group manager was particularly upset about it. So Endry made it his personal mission to show that person that his needs would be met under the new IT regime. "We worked the hardest at making that group happy because they pushed back the most," he says.
Out of that mission came service-level agreements that each division could customize according its needs. Since IT charges back the divisions for its services, the business units would pay for additional services. He also assigned full-time IT account managers to a few key departments, such as development, each of whom has experience in the assigned department.
As a way to measure the IT organization's progress, Endry adopted the marketing department's external customer relationship program to improve IT's internal customer satisfaction. In this program, he matches a senior IT person with a department head so that the two can periodically meet and discuss progress.
Endry also conducts quarterly reviews of the major services IT provides, such as e-mail and networking. And as an added bonus, he does not charge back for this program.
In addition, Endry closely monitors the success--or failure--of all those efforts with extensive "smart" surveys that are administered every quarter online to measure customer satisfaction. The surveys, devised by a Denver-based company that Endry hired, feed users certain questions based on their answers to the previous questionnaire. The survey has an average return rate of about 30 percent, which is quite good, considering that it takes about 15 minutes to complete. He has seen his efforts pay off: The first three surveys have indicated that customer satisfaction levels are high.
For a technology-centric company like J.D. Edwards, Endry believes that it is the aggressive adoption of new technology that seems to make users happiest.
And he has pledged to be an early adopter in most cases. And so far he's made good on that promise: About 1,500 users are already on Windows 2000; all 6,000 users have the Office 2000 suite. Says Endry, "[Early adoption] helps with IT retention issues, and the users love it."
Don't fret if you lack the resources to set up a separate group to handle internal customer relations. Sometimes it's the little things that make a difference.
Take Marco Tapia, CIO at P&O Ports, a global port operator (and wholly owned subsidiary of 178-year-old Peninsular and Oriental Steam Navigation Co.) in Sydney, Australia. Although Tapia has no group that focuses specifically on internal customer relations, that doesn't mean he gives customer service short shrift. He makes his users feel special in a number of modest ways.
For one thing, Tapia's department keeps all users--who are spread throughout 15 countries--abreast of IT developments via a monthly e-mailed newsletter that also appears on the corporate intranet. This newsletter contains information about IT projects, technology advances, business changes that affect IT, new employees in IT and the like--"everything that can help users understand what IT is doing," says Tapia. Once a year, the IT staff also publishes its newsletter in a glossy magazine format to make a bigger splash.
And that's not all his group does to promote customer relations. For a while now, it has held parties to celebrate the successful launch of IT projects, such as the debut of a corporate e-mail system or the introduction of the company's intranet. Tapia attracts users to these parties by sweetening the deal. Instead of the humdrum bring-your-own brown-bag lunches, Tapia lures users to evening launch parties with the promise of cocktails and hors d'oeuvres. "We invite our users to a presentation about the project. A few beers and a few shrimp make it all go down very smoothly," says Tapia.
He also encourages users to bring in key external customers to see a particular application in action, such as ePorts (www.eports.com.au), the company's new B2B e-commerce website. "Users love this," he says.
Since P&O Ports' IT department is distributed across the globe, Tapia issues business cards that list the proper IT contact for the different groups. This prevents confusion--and resentment--from erupting. "We use the same techniques internally that the company uses to market its products externally," he says.
Tapia believes that Internet technology has actually made it easier to serve his customers. Although it has increased customer expectations, the Web has also encouraged alignment between business executives and IT. "Senior executives understand what the Internet can do for the company and its customers," says Tapia. "For the first time, [business executives] are receptive to IT."
3- STARTING FROM SCRATCH Unisa CIO rebuilds a dysfunctional organization and improves department responsiveness You have to walk before you can run, and you have to deliver basic service well before you can rise to a level of excellence. That's the lesson Joe Gagliardi learned two years ago when he became CIO at Unisa of America, a privately held Miami manufacturer of women's shoes.
Gagliardi found himself walking into a "terrorized mess." IT support had been distributed to the business units, and when those support people left the company, they were very difficult to replace, since there were no documented departmental procedures nor standardized technologies. Consequently, many departments were muddling along without any IT support, and people were angry.
"The infrastructure badly needed help," says Gagliardi.
"IT was disorganized in those days," recalls Ed Bertuccelli, vice president of finance and a six-year employee of Unisa. "I had problems getting [the department] to update certain systems. When I asked for enhancements, I was told, 'That's impossible.' It was discouraging. You'd want to try to improve things, but you weren't getting the service you needed [from IT] to do your job to the best of your ability."
Another problem was that for years the company had been relying on e-mail as a primary business collaboration tool, but no one in IT had ever bothered to make sure that the e-mail system was being backed up. "If you lost e-mail, you would lose business data. No one ever captured that before," says Gagliardi.
In addition, all seven members of the IT staff were qualified AS/400 programmers who over the years had been drafted into doing day-to-day support (hardly the best use of these highly skilled people). To make matters worse, six months after joining the company, Gagliardi's staff had all left. But instead of running for greener pastures, he seized that opportunity to centralize the IT organization and implement a standard desktop.
Gagliardi also took a different approach to replenishing his staff: Rather than hiring only highly qualified--and highly paid--programmers, he hired three seasoned programmers and recruited a number of recent college graduates--not even ones who had technical skills. But Gagliardi did have certain requirements: "I looked for the talkative ones. I asked them silly questions just to see if they laughed a little," he says. Those who did were hired to be "operators," or support people. Gagliardi also made sure that those support people could speak Spanish, since Spanish is the first language of three-quarters of the people in the Miami office. (One programmer speaks Chinese, which helps when dealing with the factory in Taiwan.) The skilled programmers, meanwhile, were free to focus on development work, including maintaining and upgrading the company's homegrown PC-based ERP system.
Accustomed to having their own dedicated support person, users were up in arms at the prospect of calling a central support number--fearing that IT would be less responsive than ever. So Gagliardi implemented a special 411 support number for the highest-priority requests. And over time, he got users with less immediate problems to voice their requests in e-mails or to call a second-tier number for help. Since IT people have proven that user needs will be addressed within a reasonable amount of time, users are not as quick to push the panic button. "[The 411 number] works very well," confirms Bertuccelli. "It's much less disruptive. You don't have to page [the support person] or go looking for [that individual]. It's helped productivity."
It took about a year to train the new support people and to work out years of kinks that had made their way into the systems. All of Gagliardi's hard work did pay off. IT service has improved greatly since Gagliardi came on board, says Bertuccelli. "There are fewer errors, computers are standardized, and there's more uptime," he adds.
However, Gagliardi says that one item remains on the IT to-do list: improving end user training. But since their operational needs are addressed quickly, users are more inclined to give IT leeway on such training projects and on developing long-term strategic applications. Says Gagliardi, "You have to understand what users are screaming about. Most of the time, they're screaming about operational issues. The applications are a long-term strategic project.
As long as they can see steady progress on the applications, they're patient."
Interestingly, Gagliardi may be one of the last U.S. CIOs (certainly the only one among these four) with the luxury of operating in a pre-e-commerce environment. Unisa senior managers, who have no retailing experience, are in the process of deciding whether to target B2C e-commerce or focus on a B2B supply chain initiative. Neither project is in the works yet. And Gagliardi is naturally leery of the explosion in user expectations that will surely follow the company's foray into e-commerce. Even patient users may lose their tolerance once they get a taste of Internet life. Gagliardi is trying to stem that tide for as long as possible. "I've been saying to my boss, 'Please don't do that to me. We are not set up for this.'" Do you have an interesting approach to managing user relationships? Send it to Managing Editor Cheryl Asselin at email@example.com. Lauren Gibbons Paul (firstname.lastname@example.org) is a freelance writer in Waban, Massachusetts.
PROS AND CONS Consider both sides of the issues before dedicating a team to manage user relations Creating a group within IT to handle internal customer relations signals you're serious about customer service, but having a separate department within IT for customer service may make IT staffers think customer service is not their job.
A separate service group frees the CIO to focus on other aspects of the job, but even mentally offloading the internal customer service function may cause the CIO to lose sight of customers.
A separate CRM group facilitates the flow of information between IT and the business units, but unless you formally capture the IT CRM manager's knowledge and funnel it back to the IT organization, the business unit will suffer if that person leaves the company. -L.G. Paul BRIGHT IDEAS Simple ways to beef up your internal customer service Make 411 the help-desk number so that users don't have to remember yet another number. Or print business cards that include contact information.
Establish clear service-level agreements with internal clients. Let certain user groups customize their SLAs (at a higher charge-back rate).
Throw launch parties after a successful technology project or application has been rolled out.
Distribute a monthly or quarterly newsletter on what IT has in the works and on the horizon. Solicit contributions from users. Make hard copies of the newsletter, as well as distributing it on the intranet and via e-mail. Then let individuals select their desired mode of delivery.
Appoint an IT "communications officer" to function as ombudsman and facilitator in business-IT issues.
Assign the most critical departments their own IT account manager.
Offer users the opportunity to bring in external customers to showcase a particularly successful IT application or service. -L.G. Paul