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Selling IT on value more sustainable than selling on price

Selling IT on value more sustainable than selling on price

In what has become a largely commoditised environment, IT services companies are finding themselves in a position where they are selling the same – or similar – products and services as their competitors. So, what is it that predicts success, and allows certain companies to rise head and shoulders above their competition? Where 'value-added' is a commonly-used phrase, what is it that provides the cutting edge to push an organisation ahead of its competitors?

It is the people and service culture within an organisation that makes a company unique. By taking care of core staff and creating an environment where everyone understands the importance of their role, value is automatically created.

It is critical to ensure that the entire process - from solution architecture to quoting and through to provisioning - is as clean as possible, to ensure that kinks are worked out before a solution is delivered.

If that is achieved, then personalised and proactive after sales service becomes a fundamental key differentiator. This is ultimately what most companies are measured on when providing real time services. It is only once a solution has been implemented that true value can be experienced.

All industries have competition, but companies must be self-critical in understanding their core competencies clearly. You can't be everything to everyone. Sticking to your knitting and providing solutions that meet your core competencies as a business may be seen as a limitation in an industry where competitors resell a multitude of products.

However, focusing on providing specific products better than your competitors - even when those products appear to be commoditised - provides a competitive edge in an industry where customer service and solution delivery on the whole is fairly poor.

Companies need to know when to walk away from big deals if they are not within their core skill sets. Large revenue opportunities can be tempting but if the ability to deliver is even slightly in question, this can result in reputational damage that can destroy a business.

By being a core specialist, an organisation will understand their customer profile more deeply, and can provide a true solution that meets their needs. It is at this point that the customer will perceive true value, and the deal becomes less about price and more about received value.

One of the core aspects of turning value into profit is by providing true relationship management to customers.

People deal with people, not systems. For example: the SME market, where smaller companies initially jumped on the FTTH bandwagon as the answer to their networking and communications prayers, as it became increasingly available across our metros.

However, SMEs are beginning to realise that just having cheap fibre connectivity does not provide the service and support they need for their business requirements. For most SMEs, problems arising as a result of using these services are usually only resolved through a call centre and there is no personal touch or true quality of service. Both SMEs and enterprises are now starting to turn to ISPs that provide speciality services for their voice and data management.

People are initially put off by cost of a specialist ISP, and purchase on price only. However, after being burnt by poor service, they eventually return and look for a sustained, business-to-business relationship where a real person on the other end of the line will provide the true support their business requires.

Only add those products and services that are complementary to your existing competencies - anything else will distract you and dilute the quality of your offering.

By Kyle Woolf, CEO of telecommunications specialists Saicom.

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