HBR's 10 Must Reads for Executive Teams by Harvard Business Review

Author:Harvard Business Review
Language: eng
Format: epub
Publisher: Harvard Business Review Press
Published: 2023-06-27T00:00:00+00:00

5. Build strong relationships and networks

One of the few barriers to entry that remains powerful in a transient-advantage context has to do with people and their personal networks. Indeed, evidence suggests that the most successful and sought-after employees are those with the most robust networks. Realizing that strong relationships with customers are a profound source of advantage, many companies have begun to invest in communities and networks as a way of deepening ties with customers. Intuit, for example, has created a space on its website where customers can interact, solve one another’s problems, and share ideas. The company goes so far as to recognize exemplary problem solvers with special titles and short profiles of them on the site. Amazon and TripAdvisor both make contributions from their communities a core part of the value they offer customers. And of course, social networks have the power to enhance or destroy a firm’s credibility in nanoseconds as customers enjoy an unprecedented ability to connect with one another.

Firms that are skilled at managing networks are also notable for the way they preserve important relationships. Infosys, for instance, is choosy about which customers it will serve, but it maintains a 97% customer retention rate. Sagentia, a technical consultancy in the UK, is extremely conscientious about making sure that people who are let go remain on good terms with the firm and land well in new positions. Even at a large industrial company like GE, the senior leaders spend inordinate amounts of time building and preserving relationships with other firms.

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