Many managers assume that their products and services will be relevant tomorrow. But employees hide problems and markets change. Unless you actually probe the organization and ask tough questions, you may be deluding yourself.
When Peter Drucker first proposed his “marketing concept” back in 1954, the notion that meeting customer needs better than your competition is the driver of business success was a radical idea.1 Today there are numerous variations on what it actually means to “serve the customer,” but most managers agree that achieving sustainable organic profit growth requires combining several elements: having a clear, relevant customer promise; reliably delivering on that promise; continuously improving it; periodically innovating beyond the familiar; and supporting all that with an organization that’s open to new ideas and market feedback. Unfortunately, that approach is now so familiar that many managers pay little more than lip service to it. To be sure, implementing what Drucker proposed is difficult. Not only does it require putting customer needs above those of employees and managers, it forces you to face up to your mistakes and focus on what’s critical (perhaps even boring) as opposed to what’s new and exciting. What’s more, it requires a willingness on the part of senior executives to open up communication with people throughout the organization so they can hear what is actually going on as opposed to a sanitized version. Few companies choose to make this leap, even though not doing it can seriously hurt long-term business performance.
The Leading Question
How do managers ensure that their products and services are, and remain, relevant to customers?
- Make sure everyone in the organization really understands and supports the brand promise.
- Be suspicious of sanitized reports — seek unfiltered information on the customer experience.
- Don’t rest on your laurels. Think about incremental innovations and also ones that go “beyond the familiar.”
The challenge for companies is to turn Drucker’s marketing concept from a “motherhood statement” into a meaningful commitment that everyone in the organization understands and takes seriously. Based on our interactions with scores of companies, management’s assumptions about the organization’s commitment to customers are often based on wishful thinking.