Sourcing & Vendor Management: A Key Driver In The Customer Experience Ecosystem

Christopher Andrews
Vice President, Research Director
October 27, 2011

This is a guest post from Kerry Bodine, a Forrester vice president and principal analyst serving Customer Experience Professionals. Kerry will deliver a keynote on the critical role Sourcing & Vendor Management Professionals play in customer experience at Forrester's Sourcing & Vendor Management Forum on Nov. 7-8 in Miami and Nov. 30-Dec. 1 in London.

Many customer experience initiatives don't meet their full potential — or worse, fail completely — because companies don’t have a complete picture of the dynamics that go into creating it. In order to break from their tunnel vision, companies need to understand their customer experience ecosystem: the complex set of relationships among a company’s employees, partners, and customers that determines the quality of all customer interactions.

In their quest to seek out the root causes of customer experience issues, companies often overlook the impact of sourcing and vendor management (SVM) professionals — often referred to as “procurement” by the rest of the organization. That’s too bad, because these decision-makers influence the customer experience in two key ways.

They influence which technologies and tools will be purchased. Some of these technologies are used internally. One example is: customer relationship management software, which enables employees across the organization to better understand customers and their ongoing relationships with the company. Other tools — like content management systems — directly affect the information that customers can access through digital touchpoints like the Web and mobile devices.

They shape the nature of service-based partner relationships. Some partners — like interactive agencies — help from behind the scenes to design and develop customer interactions. In contrast, partners like outsourced call centers and service technicians have direct contact with customers every single day.

Unfortunately, the goals of SVM professionals aren’t often aligned with those of the rest of the organization. While companies are increasingly making customer experience part of their corporate strategy, SVM professionals still get rewarded for getting the best deal financially possible. Saving 2% to 3% on a major contract is considered a huge win. But picking a software vendor or service provider based solely on cost savings can be disastrous for the customer experience.

A cheaper software product that doesn’t support employees’ needs — or is difficult to use — will make it hard for employees to do whatever they need to do to support customers on a day-to-day basis. And back-end tools that don’t offer the right functionality can make it next to impossible to deliver great digital experiences. Similarly, picking a service provider that’s cheap, but doesn’t have the right skills or attitudes, is penny-wise and pound-foolish.

Make no mistake: The partners your company chooses to do business with have a significant impact on the customer experience you can deliver. That’s why customer experience professionals need to collaborate with SVM professionals to map the connections from existing software applications and service providers to specific customer interactions.

These teams also need to work together to adjust the criteria that SVM professionals use to evaluate new partners. When evaluating software vendors, SVM professionals should ask about the vendors' design process and whether or not they incorporate best practices like usability testing to ensure ease of use. When evaluating service providers, SVM professionals should inquire about the companies' culture and how they motivate their own employees to deliver a great customer experience.

Ultimately, companies need to realign the goals of SVM professionals so that they’re rewarded by helping drive a better customer experience.

I’ll be delivering a keynote about the customer experience ecosystem at Forrester’s upcoming Sourcing & Vendor Management Forums in Miami and London. I hope to see you there!


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