Customers Take the Power Seat
In this issue
  • STAR Awards for Best Practices – Nomination Forms Now Available

    • For the last 20+ years, software vendors have wielded power over customers looking to automate processes and become more efficient. Customers across industries embraced technology and invested almost indiscriminately. Then Y2K came along and forced many companies to upgrade working software, a boon to the software industry with customers racing to upgrade to compliant applications. Today, most of these companies are still figuring out how to get full value from their investments.

    But times have definitely changed. Caused largely by the recent economic lull, the seat of power has shifted from vendors to buyers. Buyers now have much more leverage in their relationships with technology vendors – and they’re using it to renegotiate and restructure contracts, exert pressure on price, demand better

    services and offerings tailored to their needs, and force vendors to take a more active role in their business success.

    A recent Wall Street Journal article, The Revolt of the Corporate Customer, drives home these issues, validates the 2005 SSPA Support Demand Research, and provides some specific customer examples.

    The bad news is there’s no relief in sight and the pressure on pricing is likely to increase, particularly hazardous for those vendors who rely heavily on support and maintenance revenue.

    The good news is that SSPA’s 2005 Support Demand Research found that this evolving environment also provides opportunities for vendors to offer new services to help customers lower their total cost of support and maintenance (TCSM). To improve the real and perceived value of support and justify pricing, vendors should:

    • Articulate the value of support and maintenance, especially to CIOs
    • Continue to invest in Web-based tools
    • Package tailored offerings for specific customer segments
    • Help customers reduce TCSM

    The SSPA is working to help support professionals understand and meet these challenges through the formation of a Support Industry ROI committee to analyze, identify, and promote industry best practices for defending the value of support and maintenance both internally and with your customers. We are also working to provide you with the research, resources and expertise you need to meet these challenges.

    Please send us your input on support ROI. What issues are most important to you? What can the SSPA do to help you most? Do you have ROI experiences to share? Contact David Kodama or call 858-674-5491.

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