Biting the Customer Hand That Feeds Us

By Faisal Hoque  |  Posted 2008-05-12 Print this article Print

The extended enterprise needs to be precisely focused on customer needs.

Let’s think about the customer for a minute–not your customer but you, the customer. What isn’t working for you?

The cell phone company whose calling plans and rules are so complex you’ve started looking at carriers with no-contract deals and voice over IP alternatives.

The national bookstore chain that sends you coupons by e-mail, but when you show up at the store says you aren’t in their savings club, causing you to give up and buy online from their competitor.

The supermarket that wants you to use its loyalty card so it can know everything you buy but never seems to have in stock the one thing you would buy every week, so you go elsewhere.

Companies like these are awash in technology but put at risk their most important asset: the customer.

We in business are well aware that behind the scenes there is some fundamental disconnect between the power technology gives them and their business plan for using it. So what technology gives, technology takes away: Their customers will leave eventually, and they can do so easily today because of technology.

Peter Drucker, the famous management writer who coined the term 'knowledge worker' once said, “The purpose of a business is to create a customer.”

Is that really the purpose of our companies? Or are we focused intently on our navels? Do we milk a product with needless modifications long past its useful life? Do we hide from customers behind mind-numbing, anger-inducing telephone trees? Do we leap out of small print and shout, “Gotcha!” at our most loyal customers? Do we barrage them with a confusion of e-mail and snail mail simply because we can?

If you’re not guilty of these things (are you sure you’re not?), why do they seem so prevalent among other companies?

Perhaps it’s a sort of deer-in-the-headlights reaction to the frenzy of changes in technology and the competitive landscape. Perhaps it’s because their executives are living in the short-term; they know they will be here personally for this quarter’s numbers announcement, but can they even imagine being here in five years?

Perhaps it’s because they lack the tools to understand what they’re doing to the customer and why. We don’t let our suppliers treat us this way. Companies today (think Wal-Mart and Toyota) get actively involved in the business of their suppliers. They seek to understand how those suppliers work internally, to make sure what their suppliers do syncs with what they do.

Recovering from a customer-be-damned spiral requires a new mindset or course, but this means more than cute slogans framed and hanging on the wall. We need a broader perspective: We need to see our business as an extended enterprise, that is, one that doesn’t begin or end at our four walls.

What this means in a global, knowledge-based economy is that what we need to know very likely resides on the outside. Most smart people don’t work for us. It is no longer about dictating terms to a supplier, but rather learning what the supplier might know that we don’t. In the same spirit, are we ignorant of what our customers know?

We haven’t been terribly good at listening to them. We often lack an “operational” picture of our customers. That means we don’t see what the customer does with our offering, and how and why. This is not about a customer’s SAT score. This is about aligning our business to the needs of the customer.

We need to understand who their customers are, what technology they employ, whether their processes might be better designed, who their competitors are, and where their threats and opportunities lie. And in all of this, we need to know how we might help them get where they want to be. This applies to business and consumer customers (yes, consumers have processes for washing clothes, mowing yards and brushing their teeth).

We need to understand how our processes affect those of our customers. Are our units or divisions warring with each other for pieces of a static pie, or studying the customer and potential customer for new ways to please them? Are we operating inefficiently, because no one is assessing the impact of time and cost on the customer?

Are we still producing the same things the same way because that’s what we know, even though the customer has moved on to something new? Are our business goals, our activities and our technology converged, or is everyone doing his own thing?

It becomes clear rather quickly why companies alienate us. It’s not deliberate. Who would adopt that as a strategy? Rather, it results from a misalignment or dysfunction in policies, procedures, processes and people.

The enterprise is not extended. It’s not hard to spot the roots of disaffected customers in our organizational structures, incentives and goals, information flows, and technology investments and management–if we look at them from our customers’ point of view.

In short,we are doing it to the customer–and to ourselves.

FAISAL HOQUE is chairman and CEO of BTM Corp. BTM innovates new business models and enhances financial performance by converging business and technology with its unique products and intellectual property. © Faisal Hoque

Faisal Hoque, Founder, Chairman and CEO, BTM Corporation Faisal Hoque is the Founder, Chairman and CEO of the Business Technology Management Corporation. BTM Corporation innovates new business models, enhances financial performance, and improves operational efficiency at leading global corporations, government agencies, and social businesses by converging business and technology with its unique products and intellectual property (IP). A former senior executive at General Electric (GE) and other multi-nationals, Mr. Hoque is an internationally known, visionary entrepreneur and award winning thought leader. He conceived and developed Business Technology Management (BTM) to direct the social and economic growth of organizations by converging business and technology, helping transform them into "whole-brained enterprises." He is the author of "The Alignment Effect," "Winning the 3-Legged Race," and "Sustained Innovation," among other publications.

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