By John Hunter, author of Management Matters: Building Enterprise Capability.
There are few managers today that would say their organization doesn’t focus on customers. It is fairly accepted that in order to proposer a business needs to convince customers to pay. But I find most organizations I interact with don’t do a decent job of focusing on customers (so customers are provided much worse service than they should be). The issue, I see, is not in making the case customers are important, people agree with that. Yet still many organizations are not well designed to provide value to customers and to continually improve the value provided.
The Deming perspective goes beyond the statement that the organization is concerned with customers with a complete management philosophy and management system that directs resources to continually improve the value provided to customers.
The organization needs an aim, a shared understanding of what the organization provides to customers that provides direction to the organization (point 1 of Deming’s 14 points – Create constancy of purpose). This aim guides the organization and is adjusted over the years and decades as the marketplace and the organizations role (the value the organization aims to provide to customers) changes.
A Deming based organization uses evidence based management practices to understand the value customers receive and the variation in the delivery of that value. Internally the organization uses in process measures to monitor and improve (through experimentation – PDSA cycle) internal processes.
The focus goes beyond pleasing the customer you are faced with at any one time in the Deming context. The Deming management system is designed to learn all we can from every customer interaction to improve the process of delivering value to all future customers. This mindset is a fundamentally different mindset from that of most companies (I don’t know how to make the case that this is true in once blog post – I think you have to read his books, this blog, and learn from others via books, blogs, webcasts, etc.). Viewing an organization as a system and with a mindset of process thinking creates a different organization.
This deep understanding of the customer, the value they receive and the ways they could be provided even more value drives innovation for Deming based organizations (and other types of organizations frankly – this deep understanding of customer needs and desires is something common to companies that successfully innovate over the long term).
In learning about how we know what we know (theory of knowledge) we learn to be skeptical and we learn how to improve the accuracy of our predictions and theories of how our organization works. We learn to try and put ideas to the test (to experiment). We try to find ways to base our understanding of how things work (and how well things are working) on data, while not forgetting that often that data is unknown or unknowable. But we focus on the customer by gathering data and knowledge and through experiments – not just by trying to do are best when we are face to face with the customer (and much of the value proposition is already fixed – with no way for us to make much of a difference).
Fundamentally tied into how customers are focused on are: long term thinking, viewing the organization as a system, an understanding of psychology and managing people, understanding variation, evidence based decision making and so on. The pithy quotes many remember are nice touchstones but without understanding the many inter-dependent factors that Dr. Deming explained in his books and videos and seminars those quotes are not incredible valuable (they can easily be misconstrued into something he did not mean).
One of the wonderful aspects of Deming’s management ideas is that framework is so deep, that decades into applying the ideas I don’t run into roadblocks. I don’t find myself saying well I have exhausted the usefulness of these ideas I need new ones to continue. As I learn more I better understand how the inter-related factors work together, I see new connections, I discover that what I had success with was useful but can be even more useful given my increased understanding.
Related: Customer Delight – The consumer is the most important point on the production-line – Ask customers what one thing could be improved (get actionable information based on an understanding of psychology) – Continual Improvement