Meeting customers' expectations

Peter Drucker also reflects: 'Customers only pay for what is of use to them and gives them value.'

Although low price is not the only issue, it will always remain an important part of the equation. Many of the factors that bring advantage are more abstract - the softer issues - and in turn are elements that build up the total value of ownership and bring the product closer to customer expectations. Included amongst these elements that differentiate suppliers are:

Quality, both specified and perceived, is a major differentiator. It must be delivered, even when the value chain takes on a global perspective against a background of varying standards.
Service level will be a key customer consideration. The more globally the value chain is stretched, the more doubt will arise in respect of ongoing support.
Reliability. As the supply process seeks to be more price-competitive, so the question of performance takes on new importance, given the extended global supply network. Customer expectations are rising and the ability to match or exceed them is crucial.
Total life cost is taking on more importance, as capital investment and product support have become more interwoven as factors for overall competitiveness. This trend will grow as products are increasingly sold as services and costs become more visible to the customer.
Relationships that underpin business propositions will be responsible for a significant part of value chain performance and therefore confidence. Customers will expect ever-closer relationships with suppliers and, for those that can deliver, this will be a significant competitive advantage.
Trust. The more mission-critical the application, the greater the interdependence. As supply chains extend, so confidence weakens. Increasing the transparency of the supply chain to the customer can counteract this, but it requires a high degree of trust between supplier and customer.
Communications of good quality are essential. Enjoying a comfortable dialogue, linked to visibility on a global scale, provides a perception of reduced risk.
Connectivity of processes and the application of technology by a customer create the necessity for the supplier to provide appropriate interfaces.
Ethical and environmental standards are becoming a new currency. The 'wired world' creates a fresh vulnerability to pressure groups that may exploit issues within global supply networks.

Meeting the customer's expectations is a complex process and a challenge. This complexity increases when the market place is progressively more fluid and dynamic.

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