June 2001

CONTEXT

Customers Carry the Day

by Doug Henschen

What's the best way to grow your business? Offer superior customer value. What's the best way to keep customers over the long haul? Deliver superior customer service.

With all the dot-com meltdowns and earnings shortfalls of recent months, it's interesting to note the correlation between customer focus and financial performance. It's also telling to examine the substance and packaging of technology these days and how well these are connected (or not) to real-world business needs.

Customer needs came up quite a bit in mid-April when Interwoven, of Sunnyvale, CA, came to New York to unveil version 5.0 of its TeamSite Web content management software. Interwoven is widely acknowledged to be the leading pure-play Web content management software vendor. You know a company is a market leader when everybody mentions them - and usually mentions them first - as a competitor.

While conventional wisdom has it that the upstart, Web-centric vendors are faltering along with their Web-centric customers, five-year-old Interwoven is doing just fine. The company recently reported a 337 percent increase in revenues, to $60.5 million for the first quarter ended March 31.

What struck me most at Interwoven's launch event was how much company executives talked about their customers. President and CEO Martin Brauns, COO John van Siclen and product management VP Kevin Cochrane all credited, at length, the company's customers - for guiding product development, for pushing for simple interfaces that could turn anyone into a content contributor, and for demanding everything from spell checkers to mobile delivery methods.

Sure, it's easy for any company to wave a flag about customer attentiveness, yet here's a company that could afford to swagger - OK, so they did a bit of that, too. But Interwoven also had plenty of customers on hand who were willing to back them up, including executives from Lehman Brothers, Sutter Health, Nortel and a few other blue chip firms.

This experience stood in stark contrast to more than one of my recent vendor briefings in which the company could little explain how its latest products could be used to solve common business challenges. Development seemed to be driven not by what customers needed, but by what was technically possible to achieve. In a few cases, it seemed like a naked ploy to add "e-" marketing spins to rather conventional products.

This month's story on electronic bill presentment and payment offers more evidence of the importance of listening to customers. EBPP was supposed to be a killer Web application, but consumers haven't exactly lined up to receive a disconnected jumble of static electronic bills. Nor have they jumped en masse to pay extra for the right to pay bills online. The successful companies have learned to add value, like the ability to slice and dice electronic statements so customers can analyze their expenditures.

Extolling the virtues of paying attention to customers may seem like selling motherhood and apple pie, but in today's market, solutions in search of problems have no chance to survive.