Can you have your cake and eat it too?
Right now, here in Australia, we are hearing new revelations almost every day about alleged malpractice in some of the most important and long-established institutions in our economy and our society. Shock and horror stories populate our airwaves and stories of bad personal experiences are eagerly exchanged in public and in private.
There’s much commentary on the rights and wrongs of the various issues, the causes and the cures. We read and hear of alleged poor client treatment, dishonest dealings with the regulatory authority and systemic cultural problems. Already we have seen some resignations at the highest level and we hear of possible significant changes to the way some of these institutions are allowed to operate.
How challenging it must be to work in these organisations when the alleged actions of very few have “painted everyone with the same brush”.
Seeking to understand just how we have come to this situation, one often cited reason is that certain institutions have “put their partners’/shareholders’” demands ahead of their customers’ needs” – indeed, many have said, even the needs of their employees come ahead of the needs of their customers. Somehow, it seems, the customer seems to matter less than the institutions and their owners.
Recognising that all organisations need to be commercially viable and generate a profit (surplus) I find myself asking – why does one have to benefit to the detriment of the other? Does it have to be one OR the other?
Isn’t it more likely that every organisation will have a long-term profitable business, generating ongoing shareholder returns when it operates in a customer-centric way – i.e. when it acts in the best interests of its customers?
I guess it depends on whether you take the long view or you take a short view!
When an organisation is focussed only on simply achieving monthly/quarterly revenue goals (etc.) then its actions (behaviours) will reflect those goals. If, on the other hand, the organisation’s goal is to develop a long-term relationship with their customer, their behaviours will reflect that goal. Furthermore, when an organisation’s reward structure is based upon long term returns (one major element of which is customer retention) – behaviours will reflect that focus.
“The purpose of a business is to create and keep a customer” – so said Peter Drukker some time ago.
Despite the massive changes to everyone’s business environment and the fact that the speed of this change will only accelerate into the future – this fact will remain and will, I believe, separate winners from losers, those who succeed and thrive from those who stumble.
Yes, we do need to focus on creating new customers but all that work might be to no avail if we can’t keep that customer.
Bob McCarthy
