Client Relationship Management
A seemingly farmers look, Mr. Nguyen Huu Hung, can hardly come across as a successful owner of Tan Phat sewing workshop and as an example of effective client relationship management. Mr. Hung might be no one in a busy business environment, and seems to be a wrong choice for interviewer. But do not be mistaken that lessons do not always come from big name and famous brand. They also start from small and simple things. After several minutes into conversation, under the common appearance, Mr. Hung appears as a deep well of wisdom, experience, passion and professional knowledge.
The current success of this small workshop has to do a lot with the organizational culture, because it glues everything together and predetermines many decisions and courses of action. In my interviewee’s case, there is a so-called “Power Culture”, where all the decisions come from the owner himself. There can be many debates, as to the effectiveness of this organizational culture type, but for a small business, it proved to be rather effective. With only eighteen employees, it is not difficult to control the operations and the information flow. In the Vietnamese economic environment, a strong leader means a lot; Mr. Hung became such a leader and support for his employees and the workshop in general. As the garment industry in Vietnam currently has difficulties in finding consumers, many sewing workshop have to shut down. In these conditions, Power Culture may be one of the few aspects to hold people together. Furthermore, he has other methods to maintain his business, and that will be explained by his story life.
Mr. Nguyen Huu Hung, who has no any certificate and degree in business, but currently the owner of a workshop with stable high income. He was born in Nha Be Province, which was a poor and backward place, far away from the city. He quitted his study from Secondary school and start to work as a farmer for living. Then he left the countryside to Ho Chi Minh City with empty hands. He worked as masonry, watchman, waiter and so on. He stated that the moment changed his life goal is when he was in a job interview for a famous restaurant. He remembers that the boss came and asked him why he wanted to be a waiter there. He answered honestly that because of the uniform, he wanted to wear good outfit but never had a chance to. The boss said that one of the elements that made his restaurant different from others is that he invested to please customers such as uniform. He required Mr. Hung to satisfy him in some small tests and then agree to give him a job. “That was my first lesson from the boss, pleasing people in order to get the goal”, said Mr. Hung. He worked there for 7 years, became a senior manager, learned his own experience from managing employees, controlling the workload and especially dealing with customers. During that time, he also read many books about business and enterprise fields, self-study English and realized that he wants to build his own business. In 2005, he went back to Nha Be province, open a small grocery store. To increase the income, he followed other household to buy a sewing machine to process clothes from local workshops. In 2008, he run his own sewing workshop and received order from factories. At first, he had eight sewing machines with ten employees. Now, five years later, he owns fifteen sewing machines and employs eighteen workers with stable income. The average income of his business is 50 million dongs per month after expenses, which greatly exceeds the national average around two million dongs (General Statistics Office of Vietnam 2013). However, due to economic crisis, factories cut down many partners, but they still keep his workshop. As it turns out, the secret is not profound. The interviewee says “Building good relationship with clients is long-term investment”.
He used client relationship management (CRM) that is one of the crucial elements for any company that is oriented towards the long-term result. The ideas of continuous client acquisition and retention require a lot of hard work on behalf of the company. In theory, CRM includes four steps: acquisition, profiling and segmentation, personal offers, and tracking. These steps can help the firm to compile a solid customer database and to maintain lasting relationship. In reality, though, the process does not always unfold exactly according to those steps. When talking to Mr. Hung, it became clear that even not following the clear steps of CRM, he managed to build a successful practice in cooperation with factories. Client Relationship Management is clearly visible in this relationship, because it shows the importance of long and trusting cooperation.
Kumar (2010) in the book Customer Relationship Management discusses the importance of a one-to-one relationship with the client. The author also suggests the use of many marketing strategies for retention of the customers and gaining new ones. As for Mr. Hung, do not be wrong that the major part of his success seems to rely on the already-established relationship, which does not require from him a lot of marketing. He mentioned that in the business, the key importance is make the clients stick with us, and do not depend on them. Therefore, he keeps looking for new customer attraction. He revealed that he is aiming to cooperate with a foreign investment factory, and he is confident with his English in communication with new client.
Thinking about this issue, it became clear that with the right approach, the given business could become even more successful. For instance, as Woody Driggs (2013) suggested that the company would be more successful with the use of customer analysis. It is important to study the needs of the people one works with, and to make sure that those needs get satisfied. So, the suggested five steps in the article look like a rather logical and sound way to improve operations. To take one example, Mr. Nguyen Huu Hung could gain profound insights into his customer’s preferences, and then create a detailed action plan to provide for those needs.
Customer Relationship Management, as illustrated by a small family-run business of Mr. Nguyen Huu Hung, is a valuable lesson for everyone. In times of economic hardships, this small firm still manages to develop and to earn profit, as well as to give jobs to the people around. As Mr. Hung mentions, “A good transaction is the one that has win-win result while both sides gain their profits, so that they can maintain the relationship for the next trade”. Indeed, strive for mutual benefit is one of the inescapable points of reference for a wise Customer Relationship Management. Understanding this simple rule can be the golden standard for many businessmen.
References
Driggs, W 2013, Add customer satisfaction through analytics. Improve customer value to boost profitable growth, Customer Relationship Management.
Hung, Nguyen Huu. Business owner. (Personal communication, date of interview: 29th August 2013).
Kumar, V 2010, Customer Relationship Management, Wiley International Encyclopedia of Marketing.
Monthly Statistical Information 2013, General Statistics Office of Vietnam, viewed September 5, 2013 <http://www.gso.gov.vn/default_en.aspx?tabid=474&idmid=3&ItemID=12653>.
