Customer Behavior in Engineering - Marketing Innovation

Customer Behavior in Engineering

Next, we describe the customer behavior algorithm in engineering (Figure 9.2).

Stages of Customer Needs Identification in Engineering

Fig. 9.2. Steps to identify customer needs in engineering

Stage 1. Attention: Identification of the requirement that may arise as a result of legislative requirements occurs (for example, transition to underground cable lines instead of external power lines); the need for technological re-equipment for the company, the diversification of production; the need for the construction of some social objects.

Stage 2. Interest. At this stage, an information study, an analysis of the technology market and potential bidders for the sale of technology and the provision of engineering services are conducted.

Stage 3. Evaluation. Announcement and holding of a tender to select a contractor.

Stage 4. Acquisition. At this stage, the choice of the contract type is justified, the risks are taken into account, the pricing models are determined.

Step 5: Maintenance. Service facility, technology after purchase.

Analyzing the behavior of customers, we can distinguish the following: a product (technology in combination with engineering) is used only for specific purposes for specific consumers - corporate customers. Individuals who make decisions about the acquisition of technology and do not risk their own funds, behave rationally. To do this, they conduct a preliminary calculation and analysis, which is provided to employers. If the customer is not competent in the chosen field, then he can order such a calculation to make a decision. In any case, the sale of technology occurs through direct connections, which requires individual work with a few potential buyers. In this case, the receipt of an order for a contractor organization is possible only after winning a tender or a tender that the contracting firms are forced to organize.

The basic criteria for the decision of the customer to choose a contractor should be:

• the conformity of the future object (technology) with regulatory, technical and operational and economic parameters;

• customer-satisfying pricing taking into account payment terms;

• the timing of the implementation of the project for the introduction of technology;

• Quality control conditions;

• other terms of the supply contract.

Based on the concept of asymmetry of thesauri, it is possible to identify typical groups of technology customers in relation to the investment object, based on the following postulates (Table 9.1).

1. The customer intends to exploit the technology that is the subject for achieving the investment objectives.

2. Technology itself is the goal of investment, and the customer intends to realize it for profit, without long-term operation. It may be that the customer does not plan to operate the facility, but a long process of selling the asset leads to the need for short-term operation.

Another classification slice is the professional conformity of the customer of the acquired technology:

1) the technology as a whole corresponds to the customer's thesaurus;

2) there is a serious information asymmetry between the contractor's and the customer's thesauri.

If both of these types of classification are presented in the form of a matrix, then we get four basic types of customers, each of which will exhibit specific behavior in engineering projects.

The goal of all customer customers is to get the most cost-effective solution to the problem economically, but understanding who this customer is, you can offer a ready-made model of contractual obligations when implementing the technology.

Table 9.1

Customer classification in engineering

Variants of the customer's investment objectives

Professional compliance of the customer of the acquired technology

Thesaurus symmetry

Asymmetry of thesauri

Will exploit the object

Type 1. A professional customer who understands the workflow and can estimate the cost of the final object

Type 2. A customer forced to take into account the costs of this technology, despite the fact that it is non-core for him

Will not exploit an object

Type 3. Customer investing in technology for the purpose of further resale or transfer to third parties

Type 4. A passive customer who does not know the specifics of the technology and does not intend to focus on it

Based on the step-by-step algorithm of customer behavior, we can identify the specifics for each of them at the stages listed:

In the attention stage, the first and third types of customers are the initiators of the awareness of the need, while consumers of the second and fourth types are passive, for them the awareness of the need comes from outside, and they are forced to react.

At the interest step, the customer of the first type independently and professionally is able to conduct the necessary research to select a technology provider. The customer of the second type applies to the services of a professional engineering or consulting firm to identify potential contestants. The customer of the third type, relying on the calculations of his own economic department, is able to assess the effectiveness of the project from the transfer (resale) to its third parties. Passive, the fourth type of customer will seek to minimize investment in the project, thus minimizing the cost of searching for information.

At the Evaluation step and selecting contractors, customers of the first and second types should select a contractor based on closed tenders. Their specifics can be described as follows: a limited number of participants capable of performing a complex, highly individualized order; such contracting organizations have their own scientific, technical and production capacities; low price is not a factor in the appointment of the winner. Customers of the third and fourth types, as a rule, have a request for less complex and responsible technologies, the conclusion of contracts for which is carried out through open tenders.

The step acquisition involves solving the issue of the method of estimating the value of the contract. Proceeding from the fact that the conventional classification allows to allocate contracts based on the announced price of works, as well as based on cost compensation, customers with symmetric thesauri (the first and third types) will be inclined to conclude contracts based on cost compensation, since they can professionally monitor the process fulfillment of obligations. Conversely, customers of the second and fourth types will prefer contracts with a pre-announced price of work.

The final step is maintenance, or directly engineering. Here it is important to analyze what volume of service can lie on the supplier, how responsibility will be distributed between the seller and the buyer, in cooperation with whom such services will be provided. This stage is most interesting for consumers of the second type, since in the presence of asymmetry of thesauri (naturally, it is a question of insufficient level of thesaurus in the consumer), it is this consumer who will apply for engineering, technical assistance to the seller of the technology. The consumer of the first type will try to provide engineering support by own strength, being technically and informally competent in the chosen area. It is most likely that the consumer of the second and fourth types will try to free themselves from engineering support, shifting this function to the ultimate exploiter of technology.

There may be different variants of the customer's behavior at different stages of the investment-engineering process, depending on the tasks that he will have to solve in the future and on the basis of which he makes decisions on concluding contracts. Relationships contractor-contractor are clearly represented in the form of a swing in Fig. 9.3.

Swing relationship between customer and contractor in engineering

Fig. 9.3. Swing relationship between customer and contractor in engineering

1. The customer himself owns the engineering competence at a particular stage of the investment and engineering process. This is expressed in the presence of qualified personnel for this work, the means of labor and the base of the acquired knowledge sufficient to create a new intellectual product. From the contractor to the contract at this stage requires a high-quality execution of the solution with the exact terms and minimum costs.

2. The customer himself does not own engineering competence, but due to the objectives of the investment project, plans to create competencies sufficient to manage a complex facility. In this situation, the customer buys the engineering competence of the stage for the contractor, but requires not only to train his staff of the same competence (for example, control of the process unit), but also to confirm the quality of the engineering solution of the performer from an independent expert.

3. The customer himself does not own engineering competence and, due to the objectives of the investment project, does not plan to develop such competencies. In this situation, the customer buys the engineering competence of the stage from the contractor, but requires that it ensure the functioning of the facility before the appearance of a competent operator, and the quality of the engineering solution of the contractor must be accepted and certified by an independent expert.

In conclusion, we summarize the main points. First, engineering projects are implemented in the B2B market and have a technical (knowledge-intensive) component. Secondly, the engineering project is carried out on the basis of a contract concluded between the contractor and the customer. Third, the technical (technological) complexity of the project implies warranty and post-warranty service for the final object.

Specificity of engineering as a product determines and features of marketing, which are determined by at least two circumstances: first, the specifics of engineering activities; secondly, the features of the services provided by the engineering company and the specificity of the product produced.

The integrated engineering marketing program includes the following stages:

1) conducting patent and marketing research; benchmarking of engineering projects;

2) marketing of engineering services and projects on the basis of tender and competitive procedures;

3) choosing the contract type in engineering;

4) pricing for engineering contracts;

5) promotion (in the background format);

6) the organization of warranty and post-warranty service.

However, the first four stages of the marketing program are especially specific, while the fifth and sixth are typical enough for any high-tech projects in the industrial market and are discussed in detail in the relevant sections of the textbook.

The goal of organizing all the marketing activities listed is to maximize the degree of satisfaction of customers' needs, on the one hand, and maximize the profits of contractors (executors) in the long run, on the other hand.

thematic pictures

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