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May 02, 2014

The Customer is in Charge, and They Require More Flexible Corporate IT

The customer experience matters more than ever today because the Internet has shifted the balance of power from seller to buyer.

There was a time when pleasing the customer mattered only to a point. Now it is everything, at least according to Alain Ozan, vice president of technology at Oracle (News - Alert).

“Not so long ago in the buyer/seller relationship, the balance of power was with the seller. Companies were able to dictate to the world: ‘This is who we are, here’s what you know about us, here’s how you do business with us,’” Ozan noted at the IDC (News - Alert) Francophone Summit in Morocco a few days ago.

“Now the balance of power has shifted to the buyer,” he added. “Ten years ago it was okay to have a 95 percent customer satisfaction rate. Today, that 5 percent of dissatisfied customers can bring a business to its knees.”

If customers are not happy, they just go elsewhere. The Internet now enables customers to find the competition with only a few clicks when they are unhappy.

The need to keep the customer happy is not supported by most enterprise computer systems, however; most are far past their prime, expensive systems that were made and rolled out before the Internet and social media changed everything.

“The average age of enterprise software is 20 years old, built in the early 1990s before even the Internet came into common use,” complained Ozan.

These old systems are too old, too complex and too expensive, even in spite of them representing a large capital investment. According to Oracle, maintaining these old systems is costly, and the expenses to maintain them grow by roughly 4 percent per year.

Better to write off these old systems and instead embrace the flexible new computing solutions that are better able to keep up with customer needs and wants.

With the cloud, the large investments in the previous generation of technology do not even need to be repeated. Instead, much of the computing needs can now be met with cloud service that operates on a usage or monthly fee structure. This can enable businesses to upgrade without having to repeat the large expenditures they invested in the systems they now need to replace.

Companies that ignore the shift in business landscape do so at their peril. Sellers beware.

Edited by Stefania Viscusi

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