Our economy is heavily dependent on consumers spending increasingly from year to year so the drop in customer satisfaction is quite disturbing. Why? Because it is a herald of negative financial results. Professor Claes Fornell from the University of Michigan has monitored the ACSI and a company's stock price for years and has determined that these two are strongly related. When customer satisfaction with a company drops, you can bet that a decrease in the company's stock will not be far behind and vice versa.

The question is why did customer satisfaction drop at this time? The professor puts forth two suggested reasons. The largest contributor, he says, is the price of gasoline -- which seems odd to me. He has a graph in his report showing a direct and immediate correlation between gas price changes and customer satisfaction - in opposite directions - gas price up, customer satisfaction down. Maybe we just get grumpy when we have to pay more to drive to the malls to shop...

The second reason for the decreasing customer satisfaction makes more sense -- bigger problems with servicing a growing customer population. Because retailers in general launched massive campaigns, heavily discounted items, and hopefully used their well-known BI analytics to target customers better (ahem), they drew in more buyers during this past holiday season. Unfortunately, because of the cost cutting they also did, many of these customers did not receive the attention or level of service they expected. More crowding, slower service, more out of stock situations - all contributed to the lower scores. Nothing makes my day like higher gas prices and surly clerks. How aobut you?

2. Once these are understood, determine how to change your own processes while helping the vendor achieve their goals as well. Bend to a certain extent if you have to.

3. Everyone likes “being sold” – even Mr. Monte admits it. It’s nice to be wined and dined. But there are ethical reasons for being sold on a product. You believe in it; you trust the vendor; you want the product to succeed in your environment; and, yes, you want the vendor to succeed as well. That means that the vendor has to make a profit too.

4. You may have to convince the vendor that they may have to forego short-term profit for long-term strategic gain. And you are a key component to this strategic position. This is difficult but certainly critical to the overall viability of the vendor.

5. Help the vendor understand how they should work with your company. Share your goals, objectives, initiatives with them so they can better understand how their technology fits in. Let the vendors work with your detailed “worker bees” to figure what role they play, how they enhance the overall technological environment, how they must interface with other technologies, etc.

6. Many vendors need education about how they can become easy to work with – for your company and, ultimately, for other companies. Is their contracting process streamlined? Is there a central point of contact? Do they share in the intellectual property that may be developed? Do they give credit where credit is due (and do you)? Can you minimize the red tape on both sides to make the deal possible without giving away too much of the farm – on either side?

No company is the perfect customer and certainly, no vendor is the perfect vendor. But going into a relationship with a chip on your shoulder can only result in a lose-lose scenario. NOBODY wins! Believe me, I’ve seen this happen too many times before. If you find yourself in such a lose-lose position, the best advice I can give you is to walk away. Nothing good will come from such a relationship.

I hope these ideas help you determine the type of relationship you should have with your vendors. I welcome your contributions and comments regarding this entry. Please contribute to the IP about how your company has partnered with a vendor or with a customer that has worked in the past. There are many ways to “skin a cat”.

Specifically, the CDS would address data management on a much broader scale, and it would encompass policies, standards, procedures, roles and responsibilities for data management, corporate data model, process steward, data ownership, meta data management, data quality and standardization over and above what we do in [company name], data architecture, data access, data security and privacy, etc. Currently we are seeking executive sponsorship for our CDS work.

We also thought that it would be important to obtain lessons learned and to talk to some industry experts about our efforts -- what lessons do you know others have learned and what direction/guidance, if any, do you have? We would welcome any input specific to this topic as we believe external validation of our efforts is critical to our success.”

I will be happy to add my own input to this entry later but, first, I want to hear from you. Please comment on this request. You have good ideas and we can all benefit from them.

Thank you!

The story continues with other high-flying companies:

MicroStrategy surprised the Wall Street folks by declaring a 39 percent uptick in sales growth for fourth quarter report. Ascential Software and Informatica reported an increase of 21 percent and 7 percent increase respecitively for fourth quarter 2004 over 2003 revenues. And finally, Hyperion's sales grew by 13 percent in its last quarter.

And on it goes.

In addition to these rosy financial reports, Forrester Research conducted a survey of 1,368 technology decision makers (CIOs and others) in North America and Europe and found that they plan to increase their IT spending by 3.9 percent overall and they were quite optimistic about their 2005 business outlook. Another good sign from the survey was that IT buyers are no longer so worried that their vendors were going out of business. TWhen the economy took a nosedive, many IT executives feared that vendors might not be around in six months because of the number of company failures. Now it appears that the vendors can make a profit and stay around.

So, the good news for BI vendors, according to the survey?

Business intelligence is still a top concern in the minds of CIOs. Concerns about regulatory compliance and the massive increase in quantity of data means BI still has one of the top spots at 9% of planned purchases. This bodes well for the entire BI industry, not just for the software vendors.

Analysts today state that HP, under Fiorina, lacked direction and that the company's core business or mission was difficult to determine. Harsh criticism indeed.

At the center of the resignation is the highly disputed $19 billion Compaq acquisition in 2002 which Ms. Fiorina staked her career and reputation. HP's server, storage and PC businesses have all struggled to be profitable since the merger fueling the overall disgruntlement with Ms. Fiorina, her "imperious" leadership style, and HP's overall profitability.

There seems to be little doubt that her departure will have an impact throughout the industry -- from HP's overall strategy, the possible break up of its core business divisions, even to the role of women in leadership roles in large corporations. Whether you see this as a good move for HP or a disastrous decision by the board, her departure marks the end to a Silicon Valley icon. She certainly kept HP front and center in the press and in our minds with her every move. (By the way, HP shares rose as much as 10 percent and were up 6 percent in afternoon trading.)

I welcome your comments regarding Carly Fiorina's departure, the future of HP, and this entry.