In the private sector, the easiest indicator of whether or not a customer is happy with a product comes down to whether or not they would buy that product again. On day one after joining Thomson Reuters, I learned the relatively simple customer for life philosophy. If a private corporation does not produce or support a product effectively, that business simply will not last. Our success metric depends on how well a government uses our software over decades, not short project cycles.
As one of the nation’s largest providers of integrated land management and valuation systems, over 1000 local U.S. jurisdictions have already selected a Thomson Reuters Aumentum software product platform. While the number of middle income countries using Aumentum products is now increasing, low and lower income countries often use donor funds to procure “open source” services that are extremely lucrative for consultants and programmers. But, under many land management programs, instead of buying an existing and operational product, poor countries build the same land management software using experimental techniques over and over and over again at a higher net cost. After a project closes, there is also no commitment from anyone to maintain that system. Experimental techniques and the result it produces, contrasts greatly with products created by private sector providers to be locally configurable, sustainable, and fit for purpose.
The private sector must stand behind a product. Since we are expected to work with our customers to realize a positive return on its investment after installation, we would not normally seek to measure benefits beyond the product’s stated performance standards. But in order to help the City of Cape Town, South Africa document the results achieved using one of our products, we asked KPMG to undertake a study using a donor methodology and to create a framework future customers could use to measure project success.
The study’s lead consultant, Trevor Davies, presented the results of this study this afternoon at the World Bank Land and Poverty Conference. Findings included reduced time for mass valuations; dramatically shortening objections and appeals; reducing overall cost; permitting the reallocation of staff; and identifying a host of ways in which the data has been used to provide smart city benefits to the City’s poor. Most importantly the study revealed that for every $1 dollar the City spent in product maintenance, it has received a $99 dollar return on its investment.
Had this specific example been a donor project, not only would the total project cost and interest been fully recovered, it would have also become a sustainable initiative that no longer required donor support. Without doubt, the City of Cape Town deserves great credit for its effective leadership and highly skilled staff. Admittedly we also cannot take these results as predictive for all countries. But if we are truly seeking to meet the SDG’s, if donor countries wish to move away from being “donors for life”, and if poor countries do not want to be “dependent for life”; then perhaps working toward a self-sustaining “customer for life” might be the answer.