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The clas­sic frame­work for defin­ing com­pet­i­tive ad­van­tage says there are three op­tions to choose from: Prod­uct, Cus­tomer in­ti­macy and Op­er­a­tional Ex­cel­lence (for which read ‘to­tal cost to the cus­tomer’).

We’ve all heard about cus­tomer-cen­tric or­gan­i­sa­tions, cus­tomer fo­cus and other cus­tomer-re­lated things. Ac­tu­ally, cre­at­ing a com­pet­i­tive ad­van­tage through cus­tomer in­ti­macy is the hard­est to achieve. This is be­yond ser­vice, which to­day tends to be bun­dled up into prod­uct; it is more about how well you understand your cus­tomer and how you craft an offering to them based on needs and wants they may not even know they have.

Com­pa­nies in this space have a fo­cus on: • Cus­tomer Re­la­tion­ship Man­age­ment (CRM) sys­tems and

pro­cesses. • De­liv­er­ing on time and above cus­tomer expectations. • Life­time value con­cepts. • Be­ing close to the cus­tomer. • Giv­ing de­ci­sion author­ity to employees who are close to the cus­tomer. MAS is a fi­nan­cial ser­vices com­pany head­quar­tered in John­sonville. For a long time it fo­cused on pro­fes­sion­als in the health sec­tor (higher net worth on av­er­age than many other sec­tors), and it pro­vides a wide range of in­sur­ance and fi­nance ser­vices.

MAS started life in 1921. Years ago when I worked in the in­sur­ance in­dus­try, it had leg­endary cus­tomer ser­vice – com­peti­tors knew bet­ter than to try to com­pete for MAS mem­bers’ busi­ness.

Ama­zon is an­other ex­am­ple of cus­tomer in­ti­macy: ‘be­cause you bought this, you might like that’. This is not in­ti­macy in the tra­di­tional sense of know­ing some­one at a per­sonal level, but the 21st cen­tury version of in­ti­macy (‘big data’) – know­ing cus­tomers’ tastes, pref­er­ences, buy­ing habits through data anal­y­sis. Ama­zon ex­ploits big data bet­ter than any­one else on the planet.

The prob­lem is that the cus­tomer in­ti­macy model is not that hard to achieve for a small busi­ness, but it’s really hard to scale.

For many small busi­nesses, their com­pet­i­tive ad­van­tage is the abil­ity to cus­tomise so­lu­tions for cus­tomers based on their very spe­cific needs. I of­ten hear busi­ness own­ers say “cus­tomers come to us be­cause they can get per­sonal at­ten­tion, they can get vari­a­tions and mod­i­fi­ca­tions, in fact they can get any­thing they want from us be­cause ‘it’s

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