The customer is king - or queen, if you will. We all know this, but many of us forget it when it comes to creating and executing strategy.
It's on the first page of the business handbook. Yet it's sometimes forgotten when companies need to create and execute strategy: customer needs.
Actually, it's strange. Because every company or business leader I know knows that the customer's needs, experience and satisfaction determine the future of the company. So why do we sometimes forget the customer perspective anyway?
In my experience, there are several explanations.
- Firstly, it's rarely about sloppiness. Quite the opposite, in fact. A lack of customer focus often arises because managers, entrepreneurs or business owners are so focused on their great product that they forget to ask if everything about that product is in demand.
- Secondly, the company doesn't know enough about the customer and doesn't involve the customer in the company's development. This means that the company's development is based on assumptions, hunches or anecdotal references without anchoring in the customer.
- Thirdly, some companies have a desire to sell a product based on a need that the customer didn't yet know he or she had. It can be particularly difficult to hit the bull's eye here, because you have to know the customer better than they know themselves. And at the same time have an eye for future needs and global trends.
Whatever the reason, a lack of customer focus in strategy is always a huge risk for any business.
Three concrete pieces of advice
Customer-centric strategy work - like all strategy work - is about structure. If we work chaotically, the result will be chaotic.
Remember, it's your customers who will determine whether your business exists in the future.
Sanne Markwall
My top three tips for stronger customer focus are therefore quite simple:
- Firstly, involve your customers, start gathering knowledge - and keep doing it. Assess what your customers need today and two to three years from now. What parameters do they base their choices on - and what would they do if they were sitting in your chair? I've seen a lot of business leaders exclaim: "We can't involve customers that much." Yes, it is possible - and customers are more than happy to help. After all, your customers benefit from your company becoming even better.
- Secondly, map out your customer segments based on size, types, margins, revenue, loyalty and product types. Do customers demand standard products, customized products or specialized products? It can be tempting to make assumptions here. But take the time to gather and use data. Basing your future on assumptions is often like peeing your pants in freezing temperatures.
- Third: Kill your darlings. If no or very few customers see the value in your otherwise unique product, it's not the customers who are wrong or have a problem. It's you! It makes better business sense to adjust or discontinue a product than to waste time and money on stubbornness. It can be difficult because it may be the spiritual lifeblood of the company that's at stake. But that's what it takes. Because remember, it's your customers who will determine whether your business exists in the future.
This column is published in Jyllands-Posten Business and FINANCE on February 20, 2024.
We cover all the different aspects well.
Frode Dale
Ceo
Bollerup Jensen A/S
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