“There is only one boss – the customer – and he or she can fire everyone in the company from the chairman on down simply by spending their money elsewhere.”
- Business acumen is a basic understanding of how an organization makes money (delivers value). For a business to be successful in the long term, a supervisor/manager must understand and follow through on the idea that satisfying the customer is the lifeblood of a business. The customer is the one with the money that builds the base upon which all business strategies rely. A quality product or service supported by a superior customer experience creates loyal customers – they come back and say good things about their experience. Word spreads.
- Unhappy customers do not come back and will most likely share their bad experience with others – thereby also damaging a company’s hard-earned reputation along the way.
- The smart manager has the business acumen to understand that creating value for customers is critical in the business equation and will do what it takes to serve the customer even though the customer’s expectations may seem “unrealistic.”
- Stew Leonard, the founder of Stew Leonard’s Dairy, was known for making explicit to all employees the “lifetime” value of the customer.
- He concluded that if his company could earn a customer’s business every week ($200 a week), for 50 weeks every year (two weeks off for vacation), for 10 years (average number of years customers live within his demographics) he could earn $100,000 from a single customer.
- That is the value that Leonard wanted every employee to see pasted on every forehead of every customer in his store, so the customer would be treated like an asset rather than a transaction.
- Every department in every organization plays some part in creating value for customers. The effective supervisor or manager must be trained to connect the dots between the performance of his or her work group and its impact on customers. How will the performance of a workgroup or department influence the customer’s decision to buy from/use the organization? Are they creating positive word of mouth?
- Are they positively creating repeat business?
- Creating a focus on the customer is a primary responsibility of any supervisor or manager. Service quality is a management issue – not a frontline issue. The employees will march to the drumbeat of the person they report to. When the supervisor or manager has a customer focus, the employees will respond in kind. Making money is the goal of the organization and the customer is the source. Make the customer happy. Make money. That is the most fundamental successful business strategy a company can have.
Customer value elements over which workgroups and/or departments have control include:
- Quality of product
- Cost of product
- Convenience
- Time
- Easy to do business with
- Responsiveness