Monday, December 8, 2008

What About the Customer Asset?

I like the work of the Aberdeen Group. They do good research and I like reading their reports. I just received their report titled "Asset Performance Management" dated November, 2008. They start by making the point that in turbulent times, many companies are looking for ways to get more from their existing investments. They say this is especially true for asset intensive industries. Their approach is to suggest that these companies adopt a holistic strategy to manage the complete asset base. The Aberdeen Group includes plant equipment, facilities, automation, instrumentation, data, information technology and employees in their definition of asset.

So far so good. Are there companies that do not work at maximizing the use of their assets? But that is not the point here. If you look at the words in the Box describing the mission of the Customer Institute at the top of this blog the key is managing the CUSTOMER ASSET. This is where, I believe, most companies and certainly most consultants really miss the point about customers. In some previous blogs I noted some different ways to identify the asset value of customers. My perspective is that the customer asset is the MOST IMPORTANT asset and was omitted in their report.

Companies spend a fortune measuring and maintaining the assets that the accountants say are important, and they are important. But I rarely see a company that is truly managing their customer asset. I ask companies how healthy is your customer asset? Most companies have no idea. Is it more healthy than last year? If not, why not, and what are you doing about it? I get a lot of blank stares.

Two of my objectives in writing this blog, other than to be a file cabinet for my ideas and data, is to inspire those who are working in the area of customers to start building models to better understand the customers and then to start looking at the customer as an asset. Until businesses can understand the asset value of a customer, the customer, while considered important, will not have the board room attention that, in my opinion, it deserves.

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