Disengaging business partners without alienating customers

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Many companies operate a business model which involves a partnership with other businesses. For instance, a retail outlet sells items to its customers which are produced and supplied by other organizations. A health maintenance organization (HMO) provides access to healthcare for its enrollees through a network of healthcare providers. A restaurant or fast food chain often engages vendors to supply various food items. The value they deliver to their clients depends on the quality of good or service received from their partners.

In the course of operations, it is not unusual for the relationship with a partner or vendor to become strained and require termination. This could be because the partner begins to fail in meeting quality standards, consistently defaults on the agreed service level agreement, or some other reason. In cases where customers have become used to the product or service provided by that particular vendor, such a termination could be difficult. And where this is not handled well, the company (in this case, the HMO, the retail outlet, or the fast food chain) might eventually lose those customers. And we must not lose sight of the wisdom that it can be a lot more expensive to gain a new customer than retain an existing one.

The following steps can be taken to adequately manage such situations:

  1. Communicate clearly and promptly with the customer(s): Communication is central to good customer service. And many needless service disasters can be averted by proper and timely sharing of information with clients. So where a long-time partner or vendor is to be delisted, it is important to carry the customers or enrollees along. Let them know, as far as is prudent, what the situation really is and why it is necessary to take that decision.
  2.  Provide a reliable and convenient alternative. It is not enough to remove a defaulting partner. Particularly where the partner is a healthcare provider (e.g. a diagnostic centre), the company should source for an alternative provider which is comparable in terms of offered services and location to the disengaged one. You’ll want to minimize the impact of the change, as much as possible, on the enrollee’s experience.
  3. Be open to feedback and input from the customer. Finally, it is essential to treat clients and customers as stakeholders in the business. Ask for their input on the issue. They may even have a better way of handling the situation. You really never can tell until you ask.

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