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Customer relations essential during economic instability

02 Mar 2009

During his 27 years in the speciality fibre game, Chris Emslie has learned that consulting with your customer is vital. Jacqueline Hewett asks why this approach has proved to be so successful.

Chris Emslie is the managing director of Fibercore, a UK-based manufacturer of speciality optical fibre. Following a PhD at the University of Southampton, Emslie joined Southampton spin-out York Ventures as a marketing executive in 1987. Since taking over the reigns of the firm in 1989, Emslie has guided it through several acquisitions and built up strong opinions on how to run a successful speciality fibre business.

How important is it to know your customer and your product?
I believe that support, technical knowledge and a willingness to partner with the customer are fundamental and major parts of the product offering. We understand our product intimately, as every manufacturer should. We go out of our way to understand how our customers are using our products. Even today, the lack of fundamental understanding that we see from some manufacturers is astonishing.

We benefit as people will come to us because they know that they will get both fibre and fibre consultancy. For me, this is the only way of developing the business. People will pay more for our fibres because they see that as a genuine value-add. In turn, we can invest in the product and continue to invest in our customers. This is a fundamental of business that people should not lose sight of.

Will customer satisfaction suffer due to the economic downturn?
Customer service can easily suffer. There is a lot of pressure on companies to sell and this can lead to a pressure to sell something regardless. When things are really hard, there is less emphasis on getting it right and more emphasis on getting the order. That can be catastrophic.

Companies are cutting back on travel quite viciously so the face-to-face relationship goes. The combination of low-cost quick fixes (not going to see people, reducing staff numbers and using e-mail) all play into a situation where service levels drop. That can't happen, particularly when volumes are growing.

A lot of sales people grossly undervalue the telephone. I would argue that it is still one of the most effective communication tools. E-mail is an extremely effective way of delivering complex documents but it is not a good tool to build customer relationships. You do that on the telephone and face to face and back it up with e-mail.

Do you apply your consultative approach in all situations?
Fibercore, and any other speciality fibre company, should consider itself as being active in a global market. We export 98.5% of our products, but I don't consider us to be exporters, we are simply active in a global market. This means that you have to understand different cultures and mindsets. I find that the consultative approach, while being essential worldwide, is far easier to bring about in some cultures than others. Although we are having success developing relationships and supporting customers in Asian countries such as Japan, one area that is proving problematic is China. This is down to the way that the Chinese negotiate, and I think that gradually people in China will find this a barrier.

What do you view as common misconceptions between speciality fibre vendors and their customers?
One difficulty is that customers expect high-tech products, even specialized products, to go down in price every year. Some fibre manufacturers go along with that philosophy and believe that it is all about price, which is extremely dangerous. If you have pegged the fibre price at a level where if you multiply your part of the global market by your unit price and you get an unsustainable number, you are in trouble.

What is the current state of the speciality fibre market?
We ship more than one million metres every month. By telecoms standards this is relatively small, but by speciality fibre standards it is massive. At these volumes it is easy to think that the fibre is becoming commoditized – but it isn't. We are in a growth phase, no matter what people say about the credit crunch. In the 12-month period from February 2009 onwards, we will ship 25% more fibre than we have ever shipped before.

One area that is growing is acoustic sensors such as hydro and geophones, which detect acoustic waves in water. These can be used for intruder detection within coastal installations through to tracking the flow of oil in sub-sea reservoirs. This area has been stable with demand typically being a few tens of kilometres a year up to a few hundred kilometres at the most.

In October 2008, ConocoPhillips placed a $30 m (€23.2 m) order for a geophone array that will be the biggest single fibre sensor buy in history. As the first large-scale, public deployment of this technology, this is immensely important because, once one company accepts the technology and takes the plunge, others will follow. So much is said about market pioneers but most people like to go with something that is tried and tested, particularly when they are spending tens of millions of dollars. This array will be deployed on the bottom of the ocean covering an oil field in the North Sea. There are about 600 km of fibre in one of these geophone arrays. This is an area that is on the cusp of taking off and the volumes will ramp quickly. That is as big a headache as it is a blessing.

To engineer these volumes in an efficient and effective way, you must have a consultant relationship with your customer. When volumes are rising, you are not necessarily commoditizing. You are simply going into another phase of development where in many ways the consultative approach is even more important.

• This article originally appeared in the March 2009 issue of Optics & Laser Europe magazine.

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