Critical clarity: customers and culture

I recently read a comment in Patrick Lai’s book, Business for Transformation – Getting StartedHe said “before producing a product, ensure that you have customers first.”  That got me thinking about culture and the key role it plays in any business endeavor.

Culture is the values and practices shared by the members of group.  The business culture determines how different levels of staff communicate with one another as well as how employees deal with clients and customers.  A strong culture flourishes with a clear set of values and norms that actively guide the way a company operates.

Corporate culture is a hot topic these days, and is no longer considered a fluffy, touchy-feely component of the business.  It is an important driver of strategy and is the environment in which the brand thrives or dies.  We all are aware of the unique culture of Southwest Airlines, Zappos.com, Whole Foods and Starbucks. The culture glues the company together, engenders a sense of pride and endears itself to the customer.

Every owner and manager must assess his company’s culture in order to determine what it is.  I discovered one of the best ways is to ask and to listen – to employees, suppliers, customers.  Some of the factors which are important are clarity of mission, employee commitment, empowerment, integrity, strong trust relationships, effective systems and policies, customer focus, 360-degree communication, high accountability, support for innovation and many more.

Peter Drucker is quoted as saying,

“Culture eats strategy for breakfast.”

One time when I was responsible for about 45 employees I realized that most of them had regular contact with customers and overseas employees. I was very concerned about how we treated each one.  I set about designing a strategy to align everyone with a plan for optimum treatment of those customers.

Over the past few years there has been much written about “the customer is king.” For example, the lean start-up strategy method strongly suggests that “while existing companies execute a business model, start-ups look for one.” 1 And where do they look? To the customer! Steve Blank suggests:

  1. Instead of a well-planned business plan, begin with a series of untested hypothesis which essentially are guesses of how a company can best create value for its customers.
  2. Use a “get out of the building” approach to customer development to test the hypothesis.  Go out and ask potential users and purchasers for feedback.  By using customers input, lean start-ups then revise their assumptions.
  3. Lean start-ups practice agile development to form a Minimum Viable Product (MVP).  This revision toward a product is called a “pivot”.  Each stage is customer driven and is iterative, picking up from failures in the pursuit of success.

These quick rounds of experimentation and feedback are customer focused and are definitive of the culture of a lean start-up.  Although Microsoft is hardly a lean start-up, CEO Satya Nadella is attempting to apply such a culture. “The only thing that I value and look for in other leaders really circles around the notion of: are they creating clarity and energy and are they a learner?  If you are not curious, open to learning, raising your own game, admitting your own mistakes, then I think you stop doing useful things at some point.”  Nadella sees culture as key at Microsoft.

The annual Booz & Company study indicates that spending more on R&D alone will not drive results.  The most crucial factors are a strategic alignment and a culture that supports innovation.  There may be no more crucial source of business success or failure than a company’s culture – it trumps strategy and leadership. And there are clearly two “Top Cultural Attributes”: 1) Strong identification with the customer and an overall orientation toward the customer experience; 2) Passion for and pride in the products and services offered.2

End customers play a defining role in determining future product needs.  Those that use a “Need Seeker” strategy have an advantage.  They directly engage current and potential customers to help shape new products and services based on end-user understanding.  Apple is the classic example of a company following the “Need Seeker” strategy.

CD Baby founder Derek Sivers says, “Never forget that absolutely everything you do is for your customers…it’s counter-intuitive, but the way to grow your business is to focus entirely on your existing customers.  Just thrill them, and they’ll tell everyone.”  Sivers had one mantra, “I am just trying to help musicians…and I had to keep the customers happy.”3

“To do more for the world than the world does for you – that is success!”

Henry Ford

 

1 Blank, Steve. “Why the Lean Start-up Changes Everything.” Harvard Business Review, May 2013.
2 Jaruzelski,B; Loehr; J, Holman,R; “Why Culture is Key.”  Strategy+Business, Winter 2011.
3 Sivers, Derek.  Anything You Want. Do You Zoom, Inc. 2011.

Larry W. Sharp, Director of Training, IBEC Ventures

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