In a previous posting I began a series on the sins of poor leadership. The first article, 3 Deadly Sins of Poor Leadership focused on not moving fast enough to replace poor performers, either for performance or behavioural reasons. The 2nd Deadly Sin of Poor Leadership details how the avoidance of face-to-face communications and regular one-on-ones leads to lack of respect for the CEO and poor commitment among the leadership team. The 3rd Deadly Sin of Poor Leadership is one that many CEOs and business leaders know is debilitating, but somehow continue to get trapped by it over and over again. While this is the third and last in this series on poor leadership behaviours, it is by no means the mildest, and in fact may be the greatest cause of poor business performance.
Profit in business comes from repeat customers, customers that boast about your project or service, and that bring friends with them. ~W. Edwards Deming
Everyone in the corner office knows how important it is to know and understand their customers, whether it be retail shoppers or B2B customers. Understanding the needs and wants of a customer gives an organization the opportunity to produce products, services and a customer experience that directly fulfills the customer’s needs. And the better the customer understanding, the better you can out manoeuvre the competition.
Young, trendy teens (with money from Mom and Dad) shop at Abercrombie & Fitch, Hollister, Gilly Hicks and other boutique retailers because the clothes fulfills their social and style needs, and the shopping experience is designed directly for them. The result, the New York A&F store has a waiting line out the door and around the block on most days and sales are soaring. They understand their customer. And at Hollister they appeal to a definite market niche, using young models to signify the classic California “Dude and Betty” look.
On the B2B side of the business equation, Textron Marine and Land Systems has an enviable backlog of business and orders for its various products. Military Armoured Vehicles, used to protect Allied forces in hostile situations where roadside bombs have all but destroyed the once ubiquitous military Hummer vehicles.
By getting close to their customers, the service men and women on the ground in hostile areas, and understanding the changing nature of IEDs (Improvised Explosive Devices), also known as homemade roadside bombs, they are able to build vehicles that deflect and counter such terrorist threats.
But most CEOs and leaders somehow forget the importance of being close to the customer. It seems to me they get caught up in internal politics, useless meetings called by their corporate owners, endless debates about NOP, EBITDA, sales $$ per employee, and budget meetings that take up so much of the day there is no time left to go sit with customers and do what business leaders should be doing – listening!
Looking at the average CEO’s calendar will tell the real story. No matter how much the slogans broadcast “Customer First”, the CEO’s day is filled with internal meetings, not customer meetings.
Those CEO’s who get caught up in the “importance” of their position actually do great harm to their company by not putting the focus on the most important ingredient in sustainable business success, the customer!
Tight Lines . . .
John R Childress