The customer service industry took a giant step beyond the traditional customer service model when customer relationship management (CRM) became the rage. So what’s next? Relational management, says Kenneth Carlton Cooper in his new book, The Relational Enterprise: Moving Beyond CRM to Maximize All Your Business Relationships (AMACOM, 2002). And he asserts that relational management, which includes building relationships with competitors, will be “nothing less than a quantum leap” beyond CRM.
So what’s relational management? In short, it’s systematically managing contacts with every constituent, both inside and outside the organization, from employees and reps to vendors and competitors. In the fully relational organization, he says, every external and internal contact functions as both a potential customer and a de facto sales rep. In short, unlike traditional CRM, which focuses on the customer, relational management takes a 360-degree view, considering not only customers, but also every other component in a company’s universe. “This high level of integration enables the company to sell effectively up and down both the customer and supplier chains, resulting in an exponential increase in sales opportunities,” says Cooper. In fact, Cooper advocates a complete redefinition of some of the fundamental terms of business – employees, customer, suppliers – because the traditional hierarchical, departmental organization structure, he says, is obsolete.
As part of his roadmap for transitioning to a relational enterprise, Cooper says companies must start building relationships with competitors. Think he’s nuts? Major organizations are already headed in that direction. For example, GM in August 2000 announced a Website to sell cars – including those of its competitors – over the Internet with links to competitive dealer sites. In that same year, 12 PC vendors created a company to address supply-chain inefficiencies with each pledging $5 million to the venture. Marriott and Hyatt, Borders and Amazon.com, 11 large real estate companies – all have announced partnerships of some form. “Will we see archrivals such as Coke and Pepsi… or Siebel and Oracle start working together?” he asks. “When GM is willing to link to a Ford dealer’s site, the day might not be too far off.”