What does customer focus really mean?
Dear Gemba Coach,
We’re discussing improving our customer focus, but we’ve realized we’re not quite sure what the phrase really means. Any pointers?
Oh dear. As I understand it, customer focus has two broad meanings. First, it means to put customers’ satisfaction first in all aspects of the company. Second, it also means to have a reactive customer service departments and a good customer relations program. Neither are easy.
I was recently at the gemba in the shipping area of a company that makes high-grade industrial equipment and asked the management team an obvious question: do you like your machines, and why? The reassuring part was that they all did. The scary part is that they all did for their own reasons: they liked engineering complex machinery. They were money makers. They had some challenging innovative components, etc.
Who is the customer of this machine, I asked, and what does he or she like about it? Silence. Although this management team felt they were customer focused in terms of analyzing demand and understanding what “customers” needed or wanted in general, they had never asked themselves what any particular customer would like (or dislike) about their purchase.
Customers use, or in Clayton Christensen’s terms, “hire” a product to do a job. They might like the product or service for its own sake, to some extent, but mostly they’ re trying to get on with doing something or other. The product or service only makes sense in the context of how the customer is trying to use it to produce what results. Consequently, customers tend to be sensitive to two main dimensions:
- Performance – and this tends to be true of all customers alike. Better performance on the key functional dimensions is always better than less.
- Annoyance – specific aspects of the product that generate hassles under certain conditions, such as no light for a machine used outdoors at night or fragile parts that fail with rough use.
Walk the Customer Service Gemba
Every customer’s evaluation of a product or service is a trade-off between performance which tends to be generic and annoyance which is very context specific (price being a frequent annoyance item). High annoyance makes you vulnerable to switching, particularly if switching costs are low. One of the many effects of internet sales is that switching is now often just a click away and one moment of annoyance can easily sway the customer in trying your competitor’s offer – once they’ve done that once …
A large part of the problem is therefore to figure out just how much performance customers expect and what annoys them in which circumstances. Nothing replaces going to the gemba and visiting customers at work to see how they use products or services in real-life situations, but often it’s not so easy to actually go and see.
Which is why the second aspect of customer focus is so important: your customers service department is your best measuring device. Customer service has the central role of responding to any annoyance customers feel strongly enough to complain about. By studying every such complaint and asking the customer service personnel to simply ask “why?” we can learn a lot about how customers use products and what for.
Customer service’s importance is unfortunately underrated in many companies where it’s an isolated department, often hidden in the sales organization. Customer service needs to be brought back at the forefront and visited in the gemba walks. The customer service department is a living measure of both how we intend to treat customers (especially the unhappy ones) and what tweaks customers’ noses so that we can fix these features in the product, and engineer improvements in the next generation.
True Customer Focus
Beyond traditional customer service, web-based technologies have introduced a new dimension to customer focus. As the Lean Startup movement argues, beyond making gambles about what customers like and learning from whether they did press the like button or not, we can introduce a “measure” step: build-measure-learn. How can we build measuring customer preferences into our development cycle?
Like many others, the company I was having this conversation with has a huge installed base of machines at many different customers. Modern machines now accumulate data about their own performance, failures, parts change and so on, but nobody listens. In lean, one of the first issues for autonomation is to make sure that all machines on the line can automatically shout out when tools need changing. Why not apply the same thinking to installed equipment at the customer?
And, more broadly, why not code algorithms to crunch the wads of existing data on how machines are used by customers and what their weak points are. A fresh approach to the data can allow us to blend both forms of customer focus and build a measuring step in the design cycle to make sure our new product responds to actual customer use and not our ideas of what customers should do with our product or service.
It often turns out that a more detailed approach to customer usage reveals much smaller niches than before. While an older generation of managers still dreams of the “one product takes all” that will beat the market and destroy the competition, younger entrepreneurs now know that customers don’t necessarily ask for frills or bells and whistles, but do look for basic requirement closer to their own use range, which means increased variety – not in the old sense of “mass customization,” but in the new sense of more smaller niches across the full range.
That is where customer focus intersects lean and the drive to improve quality while increasing variety as well as reducing cost by eliminating waste. As Jim Womack and Dan Jones highlighted in Lean Solutions, true customer focus demands true flexibility to be able to solve customers’ problems completely, when they want it and how they want it, without wasting their time and without asking them to do more work.
Is kanban relevant to office work?
Dear Gemba Coach,
I understand that kanban is an important part of lean, but I work in an office environment, and it’s hard to see how production orders on cardboard cards relate to improving project management – what am I missing?
The Battle for the Soul of Lean
When elements of lean management began to infiltrate management ranks decades ago, a “great divide” quickly formed, according to author and lean practitioner Michael Ballé. Some managers looked at it as a radically different, disruptive, but complete business system. Others saw it as a set of tools for operational excellence. The gulf endures and determines what results you get.
I read everywhere that in lean we should focus on process over results – does that mean we ignore budgets?
Dear Gemba Coach,
I read everywhere that in lean we should focus on process over results – does that mean that we need to ignore budgets altogether