TOO CLOSE FOR COMFORT - THE STRATEGIC IMPLICATIONS OF GETTING CLOSE TO THE CUSTOMER

While getting close to the customer is widely recommended as an obvious way of serving the customer better, there is no clear demarcation between being close to the customer and being customer-driven. No longer content with the ability to anticipate customer demand, many suppliers are seeking to influence this demand, moving from being reactive to gently proactive. Increasing involvement in the customer's business may help lock in the customer, but it also leads to increasing involvement of the customer in the supplier's business, locking in the supplier as much as the customer. This incremental integration has important strategic implications that firms must examine carefully.