Information: For a close collaborative effort between customer and supplier (consultant, vendor, etc.) to function effectively in the American business context a high level of communication between the two parties is essential.
Information flow is guaranteed via short-term feedback between customer and supplier during the entire business relationship. This allow customers to modify their requests depending on changing situations.
Mandate. Latin mandatum, task, job, order to do something for another; to represent another legally; an elected office to represent the voters.
A mandate is a broadly defined task where the service provider – consultant, attorney, architect, subject area expert – advises the client. The business relationship is not made up of small, individual tasks.
Instead, the service provider – the person who has been granted the mandate – serves, represents, and advises the client in a complex area involving many different kinds of issues and interactions.
Attorneys represent their clients in legal matters. Political office holders represent their voters. A mandate obligates the adviser to act in the interest of the client even without the client‘s expressed permission.
The first step an American supplier will take is to gain a deep understanding of the customer‘s needs. Because these aren’t always so concrete, they must also try to identify the perceived needs. The relationship with the customer should be highly collaborative on all levels, from the beginning to the end.
The American supplier, vendor, consultant, constantly strives to make sure that they are “on the same page” with the client. In fact, they work literally side-by-side with the client, going to the client’s place of work and completely adjusting their schedule. They maintain continuous dialogue throughout the process so that they always understand the client’s needs and desires, especially as they change.
This includes knowledge-transfer agreements, which detail when the customer will be able to do something on his own, without supplier assistance, so that he begins to take over the process.
Results: Because the customer exerts such a certain level of control over the external expert (the how as well as the what), the expert is held accountable exclusively for the work dictated (ordered) by the customer. How the results might affect related areas within the client company remains the responsibility of the customer. Responsibility cannot exceed scope of work.
Information: For this collaborative effort to function effectively a high level of communication between customer and supplier is necessary. Information flow is guaranteed via short-term feedback between the customer and the supplier during the entire business relationship. This allow customers to modify their requests depending on changing situations.
To serve the customer is to deliver what the customer has ordered. No more, no less. Quickly. Precisely. Fulfilling the order. Full. Filled. Unless asked, a waiter does not discuss with the customers the wisdom of their choice from the menu.
To consult the customer is to enter into the decision making process, to co-discuss, to co-think. To discuss with, think with. Perhaps initially just as a sounding board. Then later as a provider of information, input, advice. At the highest level, acting independently, but in the spirit of the customer’s wishes.
Stages. From order-taker all the way to co-thinker and co-decider. Grades. Gradations. Graduation. Gradual. From serving to partnering with. And there is a fine line between each phase, at each transition.
If the lines are identified, understood and managed (walked carefully), the collaborator is graduated, “makes the grade.” If misidentified, misunderstood, therefore mismanaged, the collaborator is not graduated. The business relationship might be terminated.
If to consult is to provide advice, then that advice might, perhaps should, include what the customer needs to hear, but does not want to hear. A fine line. How to walk it? To withhold that advice could mean to underserve, or even damage, the customer. To provide that advice, however, could damage the relationship.
If true friends are those who tell you what you need to hear, but surely you do not want to hear, at the risk of damaging or destroying the friendship, aren’t true suppliers-vendors-consultants those who do the same?
Consumer products giant Procter and Gamble sold its hair products business and its fragrances division, including the struggling German brand Wella.
But some criticism of Wella had been going in the other direction, namely that innovations happen too impatiently, and that Procter and Gamble thinks in the same fast terms as in the drugstore-based consumer products business.
Hairdressers in Germany, however, want to use the products they know over the long term, providing that they have had positive experiences with these products. Too many new things annoy them.
When it acquired Wella, Procter and Gamble bought its way into an unfamiliar field, namely the hair salon business, said a manager with a competitor. Then the company cut off the brand’s roots by closing Wella’s headquarters in Darmstadt, Germany, thereby losing institutional knowledge and the confidence of its vast network of hairdressers.
According to the manager, a former strength of Wella, namely their sales reps’ good relationship with hairdressers, was lost.
Source: Handelsblatt Global Edition. June 10, 2015. “The Great Brand Sell-off.” By Christoph Kapalschiniski.
Auftrag. A command, instruction, order, to complete a task, job, assignment; to order a product or service; an obligation, a duty. An Auftrag is given by a manager or a customer. The Auftrag indicates that someone will do something for another. An Auftrag can be rejected. They can be legally binding. An employee can assign herself an Aufgabe, but not an Auftrag.
Aufträge (plural of Auftrag) are foundational to any economy. Whether it is involves one colleague answering the email of another or one company building a production site for another, Aufträge are the lifeblood of commercial activitiy.
An Auftrag is at its core a request from a customer. Taking on the Auftrag signals that one will complete it to the best of their ability. The details are set in a purchase order or in a contract.
German companies report time and again that their Auftragsbücher, order books, are full, but that they cannot fulfill all of them due to a shortage of trained personnel, often technicians and engineers. Taking on an Auftrag is no guarantee that one can complete it.
This also means a certain degree of risk for the Auftraggeber (Auftrag giver), the customer, that the supplier will not supply the end product on the agreed upon date, or at the expected level of quality. In many ways it is also unimportant who completes the task. In contrast to an Aufgabe, an Auftrag is impersonal, business-like, unemotional. The relationship is all about the execution of the job. No more, no less.
A self-identification with the task is secondary. Only the final results count. Is the Auftrag completed, rejected or not doable, then it automatically no longer exists.
A mandate is a serious matter in Germany. The client needs to think through and research carefully, which service providers are not only capable, but more importantly trustworthy.
Even though German law strictly defines the relationship between for example an attorney or tax advisor and the client, the German client seeks a kind of special relationship over the long term, similar to one between a physician and a patient. For the German client its a matter of discretion.
And even when the advisor has significant decision making latitude, there is nonetheless constant dialogue and collaboration between the two parties. This is more than a typical business relationship. It is both business and personal. It is about representing the interests of the client in complex matters.
Both parties need to respect each other at a deeper level. They must be convinced that they can work together. Any kind of misunderstanding can lead to a difference of opinions, which potentially can allow mistrust to seep into the working relationship.
A political mandate is different. Although the office holder focuses on serving the interests of the voters, there is no personal relationship between them. The voters have to demand transparency in order to fully trust their elected office holder.
And because office holders have to represent the interests of many kinds of voters, there is a certain natural level of mistrust over and against her or him. If voters are dissatisfied, or have lost trust in the office holder, the political system enables them to end the relationship.
Taking on a mandate is a complex and delicate matter in Germany. In business as well as in politics.
Customer-supplier relationships make up the web of today‘s modern economy. Globalization is demanding more and more specilization. No company can succeed without trusting relationships with suppliers.
Nonetheless, it is the suppliers who first feel the pain when the economy weakens. German companies, however, do their best to maintain their viability, their strength. They want their suppliers to succeed along with them. Suppliers are viewed as partners in innovation.
Germany‘s largest global companies stress, therefore, time and again the importance of maintaining partnerships with their suppliers, how they together strive to establish ever higher standards of quality.
One of the largest German manufacturers of medical technology stated recently that a supplier‘s size in terms of revenue is far less important than its technical ability and willingness to work together over a long period of time. They see themselves as partners in product development.
Another German supplier operating worldwide has developed into a major customer in its own right, setting up a complex international network of suppliers, integrating its research and development area with a few selected suppliers. Its motto is: Des einen Lücke, ist des anderen Expertise, loosely translated as: The gap in the one company, is the expertise of the other.
In Germany, at the beginning of the business relationship the responsibility for how the work is done – methods and approaches – is transferred from the customer to the supplier. For the customer has contracted the expert to solve a problem, to complete a task, to manage a project. It is expected that the expert do so with limited involvement of the customer. For the two parties have already discussed and agreed on the details of how the work will be done.
The German client, therefore, wants to know upfront the methods and approaches used by the supplier. At the same time, the customer respects how the supplier works, including adapting customer requirements to supplier methods and approaches. In the end the supplier has the say about her own processes, which produce the results desired by the customer.
Every product and service is a clear indication of how a company works, their methods and approaches. And German customers are deeply interested in how the work is done. They want to understand how the supplier works. They want to be convinced by the supplier‘s expertise. The German customer also knows that the success of the business relationship will depend on close collaboration, on the coordination of work processes from both sides.
Whenever a company as the customer contracts an external supplier, they are implicitly admitting to a gap in their own expertise, implicitly stating that the area of expertise of the supplier is not a part of the their own core expertise. Companies small and large, regional and international, are constantly defining what their core expertise is, what business they are in. Defining that means defining what external suppliers they need to draw on.
This is one reason why for Germans the customer is not king, but instead a partner. German suppliers expect, and in many cases demand, that the customer accept them as partners, accept a partnership of equals, auf Augenhöhe, literally at eye‘s level.
Germans see a customer-supplier relationship as complementary, with each side having its respective strengths and weaknesses, its core and non-core areas. To do business together means to help fill each other‘s gaps in expertise, to complement each other, to serve each other.