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Industries:  General 

Importance of Buyer Feedback in Office Fit-Out Procurement Decisions

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By: Raj Manohar
Customer Success Lead

calender25 Jul 2018

importance-of-buyer-feedback

The focus of construction project management is entirely on meeting technical specifications, schedules and budgets. Service quality is generally ignored. The process of considering feedback from the buyer side requires a major transition from the contractor’s end by continuously striving for feedback from the owner throughout the construction process.

Transition to Customer Centricity Approach

Construction companies use various forms of buyer feedback or customer satisfaction approaches to improve and monitor their services in order to take customer relationships to the next level. Few of the benefits of measurement of customer satisfaction in terms of their feedback are:

  1. Improvement in communication between parties and enable mutual agreement
  2. Recognition of demand of improvement in the process
  3. Better understanding of problems
  4. Evaluation of progress towards the objective
  5. Monitoring and reporting accomplished results/ changes

The real estate/ construction management industry has evolved a long way from being a task-oriented industry to a strategy-focused market, where the emphasis on buyer feedback for the successful handover of a project is strong. The table below highlights the evolution of various factors that contribute to the process of service delivery and buyer–vendor relations:

Category

1st Generation

(Taskmasters)

2nd Generation (Controllers)

3rd Generation (Dealmakers)

4th Generation (Entrepreneurs)

5th Generation (Business Strategies)

Vision

None

Initial productivity and visibility

Function or channel effectiveness

Intra-company integration

Value network enabled

Strategy

None

Initiated projects, initiated from bottom up

More ‘joined up’ thinking but silo oriented

Company level CRM program

Value based collaboration for mutual benefit

Customer Experience

Unknown concept, Designs itself

Unknown concept, Designs itself

Understanding and focus at silo level.

Understanding and focus across the business lines

Understanding wider scope, collaboration

Organizational Collaboration

Inward focus, silostructure

First structure of customer centricity, silostructure

Changing culture and effectiveness, silos

Customer-centric, recognized by segment

Shared customer centricity, goal alignment

Process

Inward focus, Silo-oriented

Start optimizing for efficiencies, silo-oriented

Optimization at silo-level for cost and value reasons

Company level optimization for cost and value

End-to-end process optimization

Information

Basic and fragmented

Team based, fragmented, minimal insight

Shared information at silo level, inside developing

Shared information and insight across the company

Shared information and insight beyond the company

Technology

Very fragmented and functionality

Fragmented, limited functionality and focus

Strong functionality within silos

Strong functionality within company level, integration

Strong functionality, integrated beyond the company

Metrics

Few metrics, Inward Focus

Fragmented and limited metrics, operational focus

Focus on silo efficiency, lacks customer focus

Company and customer focused hierarchy

Shared objectives and balanced metrics, aligned

Few of the metrics used for indicating the implication of customer feedback reflect the satisfaction levels of the customer with respect to the ongoing projects. Some of the key metrics used in this industry are:

  1. Schedule performance—This is indicative of how often projects are delivered on/ ahead of schedule
  2. Cost Performance—This is indicative of how often projects are delivered on/ ahead of budget
  3. Safety performance—OSHA recordable incidence rate
  4. Customer Satisfaction—This is indicative of the percentage of customers that come back for repeat business with the contractor firm
  5. Profit—Net profit after tax as a percentage of total sales for the previous fiscal year

New Roles and Functions within Real Estate/ Project Management Teams

The next generation of management responsible for maintaining customer relationships that deal with customer feedback is focused on designating a primary point of contact between corporate real estate and key business leaders. Earlier, and until now, this has been more of a tactical role. The skills and effectiveness of individual client relationship managers are upgraded, while equipping the team with the tools, and rebuilding a more robust program.

The new generation client feedback program encompasses the following refinements to the existing approach:

  1. Driving consistent program implementation across all business units
  2. Increasing analysis and reporting to speed up the path from solution identification, realized savings, and value add
  3. Improving the client relationship managers’ ability to facilitate a strong dialogue with business leaders
  4. Empowering ongoing business leader dialogue that drives advanced understanding of emerging requirements and more accurate insight into demand/ supply modeling
  5. Facilitating a collaborative model for the working relationship between the client relationship managers, the strategic planning function and the delivery resources

Issues within Real-Estate Selection and Solutions

Issue

Cause

Solutions and Instruments

Adversity in selection of real estate

Agent not being transparent

Use of guarantees and reputation during negotiation

Adverse selection hold-up

The principal depends on the real estate agent

Use of replacement clauses, handover guarantees and set-off clauses

Shirking consumption on the job

Supervision costs and possibilities, limited resources

Profit sharing, penalty clauses, monitoring and reporting

Fringe Benefits

Agents’ own interests

Signaling, screening, self-selection through certificates, monitoring and reporting

From the perspective of strategy, it is essential to facilitate quarterly workshops that address strategic planning, scenario development and risk management. This is done through deployment of best practices in the area of scheduling, planning and facilitation, which in turn, ensures that the business requirement is met.

From a governance perspective, continuous review of the governance process is a requisite. The link between client relationship management output and operations has to be cleared. Moreover, an annual cycle of meetings need to be set in place to support the governance process.

From a skill development perspective, firms must improve and facilitate skill-building workshops. This will lead to improved client relationship management skills in real estate, finance, strategic planning, business diagnostics, account management and relationship development.

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