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The idea of customers sharing data with their technology suppliers is not new. Hardware and software systems have been “phoning home” telemetry data for more than a decade to help suppliers deliver on uptime and availability guarantees, and provide insights that enable the provisioning of technical support. And in a SaaS model, virtually all of a customer’s data is resident with the supplier.

In the soon-to-launch book, B4B: How Technology and Big Data Are Reinventing the Customer-Supplier Relationship, co-authored by myself along with TSIA’s J.B. Wood and Thomas Lah, this concept is taken to a new level in an arrangement called “the data handshake.” (See Figure 1.)

The data handshake represents a set of mutual agreements between a supplier and its customers for data sharing, monitoring, and usage intervention with either employees or machines.

the data handshake  

The Data Handshake

The fundamental premise is that customers agree to share system- and user-level data that gives the supplier the ability to “see” how their product is being used, and more importantly, to enable them to efficiently intervene to help optimize the customer’s outcome.

Providing such data is the linchpin to what is arguably the most critical new enabling capability for tech suppliers identified in B4B called consumption analytics. Consumption analytics is the means by which a supplier is able to assimilate incoming data streams and efficiently turn those insights into actions that help produce the maximum business value for customers.

There are seven sources of data inventory that suppliers will need to feed their consumption analytics engine: 

  • Product data.
  • Environment data.
  • Interaction data.
  • Usage data.
  • Process data.
  • Customer data.
  • Industry data.

What does this mean to suppliers? Lots. Here are just a few examples of the impact of the data handshake:

  • Reprioritizing R&D spend to enable the collection and analysis of new user- and system-level data streams.
  • Having new people in your service organization who are data wonks that can make sense of the volumes of incoming data and turn their observations into useful and actionable insights and recommendations for customers.
  • Developing a Success Science function that studies and codifies the most important attributes of customer success.

There are also important implications of the data handshake for customers, including: 

  • Agreeing to let the data leave their control in some form.
  • Accepting that their supplier may actually know more about what’s best for their business as it relates to leveraging a supplier’s technology features and capabilities.

If the price to enter into a data handshake agreement initially seems high, keep in mind that the payoff is potentially enormous in the form of faster time-to-value and the ability to differentiate from competitors. Certainly both suppliers and customers will need to carefully navigate the legal aspects of data sharing and stewardship, but the spoils will go to those who embrace this concept quickly and fully.

Convinced that this is a good idea? Let’s shake on it!

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