Solution Based Approach for Profits and Revenue

Sustaining success in business is a big challenge for organizations. In order to continue to be successful and sustain leadership position, the organizations have got to keep re-inventing their service offer and the value proposition to their customers. This calls for continuous investments into R&D, creating new products and services, increasing the value proposition of the existing products and services as well as building solutions to solve customer’s problems.

Those Organizations that practice Customer Delight as their motto and work towards providing superior service to their clients every time find themselves holding on to leadership positions.

With continuous investments being made into building products, as well as into technology to improve business processes etc, you might wonder how these Companies manage to grow their revenues as well as bottom-line.

Of course, if an organizations continues to increase the service value to its existing customers, where and when do they make money?.

The reality is that the organizations look at each customer account and do not count the transactions. They look at the Account size, the increase in customer’s spend that results in increase in revenue to the Organization.

When Organizations take to solution building and offer range of basic as well as customized and value added services to one customer, the total revenue from the entire account grows substantially across all products and services. When the Organization proposes to make substantial investments into building, implementing and managing customized solution for the client, the investments are always made on long term recovery basis and the Organization stands to benefit from building long term revenue stream.

In case of projects where the Organizations stand to invest into infrastructure and capital equipment etc, the financials and ROI are worked out to reflect an independent balance sheet with costing drawn up with Cost Plus approach with fixed percentage of profits.

More over the cost of finance too is included in the costing and in most cases, the project costs are also recovered separately. Thus, the Organization stands to gain on all fronts from investing into a long term client and building customized solution on long term basis.

The above example can be illustrated very clearly in the case of the partnership between Xerox and Airborne Express. Airborne Express worked with Xerox team to build a dedicated spare parts delivery service.

Xerox has a committed delivery schedule for servicing customer complaints. To ensure that Xerox engineers complete the servicing and repair within the committed time frame, Xerox has got to ensure that the spares are shipped out of the warehouse to all parts of the country and delivered to the engineers before 10 AM to enable the engineers to leave in time to start attending to their calls.

By working together with Xerox, Airborne express worked out systems and processes whereby it could pick up the parts on normal collection at PM time as well as collect a late night shipment that could service the late evening part requests.

The critical shipments are delivered to the engineers on the field while the bulk spares are delivered to Xerox offices.

Each Airborne delivery guy in charge is aware of the delivery commitment and is always in contact with the office co-coordinating and making sure that he connects the right part with the right engineer in time.

The Xerox parts were packed in tailor made packing cartons that make the identification easy and carried priority tag/label so that each and every handler in the logistics chain knew of the urgency and commitment.

Going forward the solution also explored managing parts inventory by Airborne and thereby give huge cost benefit and savings to Xerox in the process.

The overall scope of the solution included total spare parts inventory management, parts order management, shipment, documentation, courier and door delivery within the committed time frame followed by updation of the website for Proof of Delivery and generation of reports.

By building the above solution, Airborne express not only managed to secure long term courier business with Xerox, but could build new products and services as a part of the total solution. They gained expertise in warehouse management and other supply chain areas.

Going forward, Airborne express can also extend its partnership with Xerox to manage their inbound freight as well as outbound freight of finished goods etc.

By maintaining excellence in customer service, the Organizations can expand the scope of their business with just one client and build deeper and long lasting revenue streams and stand to gain in terms of knowledge and experience which can then be used to replicate with new clients as well.

It pays to be customer driven and customer oriented. Leadership organizations are experts in customer relationships.