Saturday, August 21, 2010

Listening to the Customer Isn't Always the Best Thing To Do

There's a great article in the WSJ today, one whose concepts I pray becomes conventional wisdom in the near future. It's called The End of Management and it contains nuggets like this.
When I asked members of The Wall Street Journal's CEO name the most influential business book they had read, many cited Clayton Christensen's "The Innovator's Dilemma." That book documents how market-leading companies have missed game-changing transformations in industry after industry—computers (mainframes to PCs), telephony (landline to mobile), photography (film to digital), stock markets (floor to online)—not because of "bad" management, but because they followed the dictates of "good" management. They listened closely to their customers. They carefully studied market trends...And in the process, they missed disruptive innovations that opened up new customers and markets for lower-margin, blockbuster products.
I deal with this problem all the time at work. We've embraced business process management and lean six sigma and just about every other structured management fad out there. We're organized like a straight jacket. Part of our corporate culture is "listening to the customer."

Our management style is copied from Bedlam, Inc.

Listening to the customer works well when you want to know if they're happy. It does very poorly when you're trying to be innovative and create new products. If your customers knew what the next innovation ought to be, they'd be working for you, not hiring you. While there are exceptions to this, they can't be found through surveys and polls. Surveys and polls are dominated by your basic customer - the voice of the visionary gets drowned out.

Back in the day, when mainframes were king, polls and surveys revealed that the vast majority of IBM's customers wanted better mainframes. A minority wanted PCs. People usually want a better version of what they already have, they rarely think of something wildly different. I think that fear plays a huge role here. The safe bet is to survey your customers and give them what they ask for. If management isn't made up of innovative, visionary people, they're not likely to become enthusiastic about anything that deviates from what customer surveys have said. They won't know how innovation actually works, no matter how many books they read on the subject.

Developing new and different products requires a manager to trust their workers to possess a vision for the future. If your workforce isn't the type that sees into the future, way past what your customers see, then you probably ought to fire your workers and hire your customers.

1 comment:

B-Daddy said...

Nice post. Leadership is better than management, and more fun.