Demystifying the term ‘Maturity’ – The balance between customer and provider

In the previous six posts on the term ‘maturity’, we learned how an organization can determine its maturity in a meaningful way, based on their power to create value instead of the plain technical capability measures that used to be the base for this. Now it’s time to take one step back, and take a look at the context: how is USM’s value-based maturity analysis going to work in a customer-provider relationship?

There are two sides to the coin

When considering value creation maturity in a service context, it is not enough to just look at the service provider’s maturity. The maturity level of the customer also plays an important role in the relationship. If there are significant differences in maturity between provider and customer, it is necessary to take this into account, to avoid a conflict between the thinking, the routines, and the mutual expectations of both parties.

All service customers are service providers

Modern economy is determined by servitization: everything is turned into services. We live in times of the Service-Dominant logic. This means that the customer is also a service providing organization.

What applies to the service provider, applies to the customer.

But each of these two can have a different level of maturity, and that can have significant effects on their relationship. A service provider can act at level 4 of the USM Value Maturity Model if it focuses on the business value of the service, if it formulates the service agreements in terms of added value, and if it measures the customer experience in terms of the effect on the customer's business operations. This only works if the customer also acts at that very same level, which is not always the case. Two cases with differing maturity levels can arise here.

Case 1: The provider is ahead of the customer

If a level-1 customer is only looking for cheap equipment, a level-4 provider might respond to the tender with an offer in terms of “we can help you make your business more successful”. That level-4 provider wouldn’t stand a chance of delivering anything to this level-1 customer. Even a level-3 provider might not be able to set up a relationship with this customer with a service-based offering. Perhaps a level-2 provider could make an offer that covered the equipment demand and put it in the perspective of its performance, from a level-2 system-driven perspective, but all higher levels would probably fail to get a deal. The mismatch between the thinking of the customer and the thinking of the provider would simply be too big.

The same would apply to a level-2 customer, seeking systems, and a level-4 provider. Perhaps a level-3 customer and a level-4 provider might have a fruitful discussion, because the provider can talk about the current demand in the context of ‘the next step’.

Case 2: The customer is ahead of the provider

Conversely, if a provider is at level 1, focusing on technological products, and the customer is at level 4 and wants 'integrated solutions that improve their business success', there is little chance of a satisfactory relationship between the two. The mature customer would set the offer of this provider aside with the comment “they are still shoving boxes”. Even a level-2 or a level-3 provider wouldn’t stand a chance: they cannot meet the customer’s maturity level.

For a successful collaboration, customers and providers should preferably be on an equivalent maturity level.

?Selecting your customers

Making a suitable offer requires that providers know and understand the maturity levels of their customers. And of course they should first of all know and understand their own maturity level. A good idea of each other's maturity avoids a mismatch and makes a good chance of achieving a balanced service relationship. ‘Understanding each other’ in this context means above all ‘having a good idea of each other's needs and possibilities’. If you express that in terms of value creation instead of in terms of technical capabilities, there is a much better chance for a sustainable match.

Investing in the customer’s maturity

The consequence of this balancing act is that a provider can set up a successful relationship with a customer that is at an equal maturity level, or maybe one level lower. This provider can understand the customer’s demand and can speak the customer’s language, and – if they are one level higher than that customer – they can also sketch an attractive future for that customer: “we can help you now, but we can also help you make the next step in your development”. This would most likely lead to a long-lasting relationship.

Providers at higher maturity levels should invest in the development of their customers

Investing in the provider’s maturity

A consequence of these maturity effects is that a provider who wants to improve its maturity has to deal with the maturity of its customers to prevent this maturity gap. Or they should look for other customers. This is especially relevant in situations with 'forced internal shopping', where the customer and provider are to a large extent 'condemned to each other'. These internal service providers cannot ‘choose other customers’, so they will need to involve their internal customers in any maturity improvement strategy.

This is where USM can be of great service. USM underpins an Enterprise Service Management strategy by providing the concept of the link for the service ecosystem within the enterprise. It also applies to service ecosystems where multiple enterprises are involved, like nation-wide networking arrangements for the management of health care data, or for the concept of ‘one government’ for all citizens in a country.

This post concludes the analysis of the concept of ‘maturity’ and hopefully helped you demystify it. Like most things in real life, things can easier be understood if you simplify them to their essence. Complexity reduction is one of the main principles of USM, the Unified Service Management method.

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