Product and Service Innovation is Driven by Customer Focused Organizations

Guest post by John Hunter, author of Management Matters: Building Enterprise Capability.

quote image - text: New product and new types of service are generated, not by asking the consumer, but by knowledge, imagination, innovation, risk, trial and error on the part of the producer, backed by enough capital to develop the product or service and to stay in business during the lean months of introduction.

At the core of W. Edwards Deming’s philosophy is a focus on delighting customers, allowing everyone to contribute what they have to offer and continually improving.

In order to bring about great results certain knowledge and strategies are useful. So things like learning to view the organization as a system and gaining an understanding of variation allows you to delight customers, give employees jobs they can be proud of and continually improve. These ideas, and the others Dr. Deming shared, are part of a integrated management system. So these ideas all work together to bring about what he discusses in the quote above.

The ideas are interrelated and self-reinforcing. Providing meaningful work creates an environment where the contributions the organization receives from everyone is greatly enhanced. And that leads to success that allows the business to invest in innovation instead of focusing on fixing problems.

It is very difficult to gain a deep understanding of what customers want in a typical organization where people are overworked and focused on “doing their job” instead of serving the customer and thinking about how the organization can continually improve (and running experiments on improvement…). In an organization applying Deming’s ideas that deep understanding of customers, and the processes used to provide value to customers, is a natural outcome. Those things can’t be missing when the Deming management system is in place.

An organization must have a deep focus on customers in order to continually improve the value delivered to those customers and to innovate and create new products and services that delight those customers and future customers that the business can win over.

The success of those efforts is based upon how well the organization is able to learn and experiment and invest. How well it is able to do those things is directly related to how well it applies the ideas mentioned by Dr. Deming (and that we have been discussing in this blog for the last few years).

One challenge with writing blog posts on Deming’s ideas is that the ideas are so interconnected that a short bit of text only provides a minor view of the implications of the idea being discussed. Thankfully this is greatly aided by the ability of hypertext (links) to connect to more details related to the ideas in each post.

I try to use this feature (hypertext) to allow you to explore the idea and how it connects to other ideas. I hope that is useful to you. I do feel following some of the links is integral to understanding the posts. The text alone provides some inkling of the notion but unless you go deeper it is very difficult to really appreciate the text of the blog post.

This same idea is true with W. Edwards Deming’s quotes. Many of his quotes are popular. And they often do provide insight. But without an understanding of Deming’s work in general the insight is a tiny fraction of the insight provided when you can appreciate the deeper connections to rich ideas he expressed in his seminars, articles and books.

A good example in this post is an appreciation for what is meant by “a deep focus on customers” is very likely to not be appreciated by most people – only those with a very deep understanding of Deming (or some related ideas) will understand what is meant without following the link to our previous post discussing what this means in a Deming context. Most organizations today believe they focus on customers but in reality what most do is nothing like what Deming had in mind.

Related: People Copy Examples and Wonder Why They Don’t SucceedThe Importance of Working with Suppliers Over the Long TermCreativity Inc. – Using Deming’s Ideas at PixarCustomers, for improvement users matters more than buyersUser Gemba

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