IT has been traditionally assigned to a standalone department – the geniuses who provide support when tech fails, keep our data secure and upgrade our operating systems so everything runs faster. This role is changing: IT staff are dispersing to departments across the whole organization, and their focus is shifting from providing support to generating revenue. Should your organization follow the trend? To make the decision, it’s important to understand how we got here. We believe that this trend is connected to some much broader changes.
Why IT Must Become Customer-Centric
The Changing Role of IT Departments
Businesses Are Shifting from Product-focused to Experience-focused
Manufacturers used to strive to offer outstanding products at a competitive price. But in recent decades, sociology has changed the opinion of marketers. Customers don’t buy products, they buy the experience they provide. In other words, it’s the satisfaction of solving a problem, security, happiness, or excitement. We use the physical attributes of a product to justify the purchase, but the emotional result is what we remember. Feelings are what makes us loyal to brands and willing to spend more on them than is necessary.
For this reason, products are no longer the primary focus of some businesses. Their attention and resources are invested in understanding the customer. The goal they’re chasing is to develop products that drive the most satisfaction, as opposed to perfecting a product first, then finding a market for it.
Service Is Now Part of the Product
A growing number of products that used to be sold individually are now packaged as a service. From subscriptions to contact lenses and recipe boxes, to car sharing, music streaming, and Amazon Prime, we’re increasingly renting access to products instead of purchasing them. For businesses, moving from one-off product sales to an ongoing service has two major benefits. It provides the security of a stream of recurring revenue, and the opportunity to learn more about each customer so they can be sold related products.
From the perspective of the customer, services are more attractive because they provide access to quality products without big up-front investments, why buy a GoPro for a holiday when you could rent one for a fraction of the price? There’s also the benefit of flexibility, the convenience of having multiple products bundled into one discounted package, and the ability to have relevant product recommendations.
Kate Leggett, Analyst (CRM), Forrester
The Impact for IT
This change means that software is no longer a tool that brands use to make their product – it is the product. If you’re shifting from selling your contact lenses in stores to monthly home delivery, then the sign-up and account management process on your website needs to be as carefully designed as the product itself. This means that the role of an IT professional is not simply to ensure that the online forms work. Their role is also to help design a sign-up process that is persuasive and easy-to-use. In this way, the role of IT is becoming more ‘customer-centric’ because it’s focused on fulfilling their needs, as opposed to the needs of the company.
How Can IT Meet These Challenges?
A customer-centric IT strategy can be difficult to achieve when time pressures are increasing, budgets are decreasing and skilled staff members are also increasingly difficult to find. For example in Germany whopping 137,000 IT position were unfilled in 2022 since the pandemic acted as an accelerator in many industries when it came to digitization. The right technology can relieve some of these stresses if it’s implemented in the right way.
Switch from CRM Systems to Customer Experience Software
CRM platforms are designed to store customer details, but that doesn’t tell you who the customer is. To start to understand your customer or client, which you’ll need to do if you’re providing an ongoing service, you need to gather much more information about them and make it accessible to as many of your teams as possible. This is what a customer experience platform is designed to do. Platforms such as the SAP Customer Experience Solutions can be integrated with ERP systems such as SAP S/4HANA. This makes it possible to determine which customers are driving the most profitability and factor this data into your resource planning.
Outsource Your Support and Maintenance Tasks
For IT departments to concentrate on their new customer-centric IT strategy, they need to be relieved of back-end processes such as data protection and updates. For this reason, many businesses are looking to external service providers, storage services in the cloud, or both. Managed services offer a company the precise degree of standardization to keep costs and complexity to a minimum. Also, they offer exactly the right amount of individualization needed to satisfy the customer. With the help of external specialists, a company’s IT is always up to date and employees have the time to concentrate on core business – and offering the best possible customer experience. This is how important customer-centric IT is in influencing the overall success of a company.
How NTT DATA Business Solutions Can Support You
We believe that the trends outlined here affect businesses in virtually every industry, and we think that the key to success lies in upgrading software first. The platforms that we use shape the discussions that we have and the ideas that our employees come up with. To learn more about the shift to the experience-based economy and how your organization can take advantage, explore our website.