All Posts Tagged With: "customers"
Quality can be applied as a strategic tool by developing a quality niche that focuses on one or a small number of quality dimensions throughout the universal processes of planning, improvement, and control. Seldom is it advisable, or even possible, to pursue all eight (performance, features, reliability, conformance, durability, serviceability, aesthetics, and perceived quality) of the quality dimensions simultaneously. This is because of both resource allocation toward quality and trade-offs that may be inherent among the dimensions. Similarly, objectives and activities should be aligned so that quality initially planned into a processed product is consistent with and reinforced by day-to-day control and longer-term improvement efforts. As pointed out by Porter (1996), “strategy involves creating ‘fit’ among a company’s activities.” When developing a quality niche strategy, specific, conscious choices must be made. The key is to discover which quality dimensions are most important to your customers and which are poorly met by competing products and firms.
Quality Strategy Failures in Processing
It is instructive to consider quality strategy failures as they relate to processing-based companies and the lessons they suggest.
- Failure to measure the correct dimensions. Injected drugs marketed on the presumption that efficacy is the driving factor in determining value may be superseded by less effective formulations that take
In our dynamic business world, where consumers are constantly revising their preferences and trying to make their own small businesses (their homes) run smoothly, business leaders need to ensure their company is honing its services to those evolving customer needs. Revisiting the Baldrige Criteria can keep us in check by reminding us how important it is to respect customer individuality. As explained in its customer focus section,
“Knowledge of customers, customer groups, market segments, former customers, and potential customers allows your organization to tailor product offerings, to support and tailor your marketing strategies, to develop more customer-focused workforce culture, to develop new business, and to ensure organizational sustainability.”
This certainly seems pretty straightforward, but the knowledge of your customers, and development for customer-focused workforce culture are carrying heavier weight than ever in today’s economy, and business leaders need to act fast to keep up. The meaning of customer respect and service is essentially becoming a leading marketing asset for businesses aspiring for success, versus just a “good idea.” Quality customer service can have a greater impact on your business than quality marketing.
Author of Leadership Matters: CEO Survival Guide, Mike Myatt, is an expert in business leadership and recently contributed in Forbes magazine about the absolute need …Joseph A. De Feo | 0 comments | Continued
The Baldrige Model: How do you obtain information from your customers?
Item 3.1 in the Baldrige Criteria asks key questions about how your organization listens to your customers. The following processes, best practices, and problem areas look at critical issues in this part of the Baldrige model.
Your organization needs processes for:
Listening to each key customer group and market segment across the entire customer life cycle, to former and potential customers, and to customers of competitors to obtain actionable information
Following up with customers on product/service quality, customer support, and transactions to acquire immediate and actionable feedback
Determining customer satisfaction, engagement, and dissatisfaction
Using data and information about customer satisfaction, engagement, and dissatisfaction to exceed their expectations and improve loyalty
Obtaining information about your customers’ satisfaction with your organization, products, services, and support relative to their satisfaction with your competitors and other organizations providing similar products and services
Best practices to consider:
Using established processes, the organization knows exactly what each of its customer groups and/or market segments requires and communicates that knowledge throughout the organization.
Listening posts are established for all customer groups and segments with processes for collecting, analyzing, and sharing the information from those posts.
Follow-up with customers typically includes relationship and transaction surveys and frequently …Steve George | 0 comments | Continued
It’s a fundamental question that demands a profound knowledge of who your customers are and what each individual customer is seeking. B. Joseph Pine II, one of the pioneers of the mass customization concept, recently wrote an insightful article for HBR that bashed the notion that most organizations are customer-focused. “They focus on markets rather than on any real, living, breathing individual customer,” he wrote here.
Pine offers a fresh perspective on what it means to be truly customer-focused with a list that could be a how-to for understanding what your customers require:
- Every customer is his own market. Every customer deserves to get exactly what he wants at a price he’s willing to pay, and companies must make that happen in a way that makes them money.
- Recognize that every customer is multiple markets. Customers want different offerings at different times under different circumstances.
- You must modularize your capabilities. Break your offerings apart into modular elements like LEGO building blocks, and then create a design experience that helps each customer figure out what he wants.
- Don’t overwhelm your customers with choice. “Fundamentally, customers don’t want choice,” says Pine. They just want exactly what they want.”
- Recognize that mass customization is not being everything to everybody; rather,
Yesterday, I wrote about companies that have created the position of Chief Customer Officer to bring the Voice of the Customer to the senior leadership team. Today, I want to write about a company that probably doesn’t need a CCO because it differentiates itself through its customer-focused culture.
The Red Wing Shoe Company serves blue-collar trades such as construction workers, telephone lineman, and miners. Located in Red Wing, Minnesota, a city of 6,500 southeast of St. Paul, the company employs 2,200 people, half of them in Red Wing. Earnings for 2010 were $448 million, up 12% from 2009, which was a tough year for the economy and for the company. According to an article on Bloomberg (available here) Red Wing “went to a four-day work week, froze raises, scaled back its second shift, and offered voluntary retirement packages” to survive the recession, but hired more than 300 employees in 2010 as sales rebounded.
Red Wing carves a unique path through the shoe industry:
- It distributes its footwear through nearly 500 company-owned and independent dealerships, which are “old-fashioned shoe stores with sales people who sit with customers, measure their feet, and fit shoes one pair at a time.”
- The 285 independently-owned stores are dealerships from which Red Wing collects no
I was ready to mock the article as soon as I saw the title, “The Rise of the Chief Customer Officer” (Paul Hagen, HBR, April 18, 2011), but then I read it and found myself agreeing with the idea.
According to Hagen, a lot of companies have created the CCO position including USAA, Allstate, FedEx, and Boeing. In fact, he gathered data on 155 CCOs and conducted interviews with several of them. He found that companies hire a CCO for two reasons: (1) to fix issues that are creating unhappy customers; and/or (2) to accelerate growth, better integrate acquired companies, or shift priorities.
I imagine a number of VPs of marketing and sales have argued that these two things are their jobs, and they probably should be, but the fact that their bosses see the need for a CCO suggests that marketing and sales have come up short. My sense from working with several marketing and sales leaders over the years is that they are inside focused out, while a CCO takes a different perspective: outside looking back in to the company.
Hagen cites the Boeing Training & Flight Services division as an example. Its sales and business development teams were focused on meeting short-term revenue goals, according to CCO …Steve George | 0 comments | Continued
A 2010 Baldrige Award winner, K&N operates Rudy’s and Mighty Fine Burgers, Fries and Shakes in the Austin, Texas, area. The company has 450 employees and annual revenues of $50 million.
The Mighty Fine concept itself came out of this identification process. K&N’s owners needed a new concept to grow the company. According to the company’s award application summary, available here, “After conducting industry research, senior leaders identified the burger market to attract new guests and grow the organization for the following reasons:
- The core competencies of K&N could easily be transferred to a premium hamburger concept.
- Industry trends indicated a premium hamburger concept would meet shifts in guest preferences.
- We wanted to be one of the first fast-casual operations in Austin to feature a premium hamburger.”
They developed a strategy to design, build, and open the new concept, using the same process that boosted sales of the breakfast taco. A test kitchen allowed them to develop a menu, test products, and refine recipes with input from employees, suppliers, and guests. As a result, Might Fine has better sustainable food sales …Steve George | 0 comments | Continued