Business Relationship Management

Businesses have numerous needs and requirements in the challenging economic climate and internationally competitive markets of today. A tool which they use to handle their relationship processes is called business relationship management. Business relationship management proves to be the defining of, comprehending of, and supporting of a wide variety of activities. These activities pertain to the receiving and distributing of information and services through various networks. The focus is on the rise of Internet based networks which are intended to be utilized as the main platform for interfacing in the business’ relationships.

Readers who are familiar with the concepts of customer relationship management, also known as CRM, as well as enterprise relationship management, will have some idea of what business relationship management involves. These three ideas are all related, although the business relationship management is distinct from them. It is more than simply a process involving a person who aligns information technologies with a business’ core interests.

The ultimate goal of business relationship management is to come up with a model which is both holistic and complete in nature. It is attempting to get various elements of business relationships to become quantifiable. To this end, well developed business relationship management protocols attempt to further techniques and tools which implement the principles of business relationship management as well as strategic research and development endeavors of business. This is achieved so that all of the interested parties in the business are capable of creating, measuring, and harnessing important relationships throughout the business network.

The idea behind business relationship management evolved from watching and analyzing the transforming impacts brought on by elements of the growing networking economy. These observations include the following:

  • The steady decline of command and control style of management
  • The increasingly available network knowledge
  • The devaluation of the traditional concepts of IP, as well as the decentralizing of information
  • A new business environment of constant disruption which has become the new normal in business
  • The continuing improvements in the sophistication, scope, and scale of networks

There are two principal roles in business relationship management. These are the roles of consumers and providers of information. Business have no choice but to engage in the two roles in varying capacities. The end goal with this process is to reach the point where the intricate complexities of business relationships can be boiled down to an easily understood transaction value.

There are two life cycles comprised in the business relationship management concept. One is a micro engagement cycle. This is characterized by a one on one business relationship, which is either a transaction or a subtle meeting. It involves end results which are mutually negotiated. The second cycle is a macro grow and sustain cycle. Its features include many on one, as well as one on one, meetings and relationships. These activities prove to be overlapping and continuously ongoing, as in marketing, online community interactions, and customer and product support activities.

There are a number of business relationship management principles. The first of these is the quantifying and analyzing of relationships. Individuals are supposed to be capable of identifying the business relationships in which they participate and to quantify both their duration of time and number. The second is the purpose of such relationships, which states that all business relationships possess a stated purpose which needs multiple roles in participating in the relationships. These purposes are supposed to be measurable and subtle. The third principle centers around trust and reputation. All relationships and their interactions impact a reputation. Reputations serve to lessen risk, as well as to lessen friction in the various business processes. An individual’s concern for both his and the company’s reputation instills proper behavior. When trust in a relationship is not present, the business relationship will not succeed. Having trust allows for conflicts to be maturely resolved and improves working efficiencies. The fourth principle has to do with governance. Business relationship management models have to line up with existing structures of corporate governance, such as legal constraints, business ethics, and socially accepted standards where they apply to business relationships. The fifth principle involves boundaries. Business relationships are to have appropriate boundaries that fit with those accepted in interpersonal relationships. The final principle is one of exchange and reciprocity. Not simply the exchange of financial means, but furthermore reputation, information, money, and time are all important elements of any business relationships.

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