Core Value #1 = Customers First
Posted on March 6th, 2010 by Paul McArdle – 15 CommentsOn Friday last week (5th March) at Beer O’clock, we brainstormed about what it means (to us) to share the primary value of “Customers First”.
We will continue this process in subsequent weeks with the aim of identifying the specifics of what each core value means to us, and how we (and others) can hold ourselves accountable.
The following is a shortened list of some of the points made during the brainstorming session (a fuller list is here as a restricted post).
A. Caution, please!
In reading the details below, please keep in mind that this listing is part aspirational, and part current reality.
We recognise that we do not yet do all of these things, but we have listed them to provide some indication of what we will be striving to become – and to give you a ruler by which to measure us.
It is for this reason that some of our grander ambitions have been omitted from this public listing – i.e. we know we are currently a long way from matching these aspirations, so don’t want to be misinterpreted (we know we need to walk before we run).
B. At a High Level
By putting customers first, we’re making a conscious choice to make our patient shareholders wait for their return.
We will NOT be driving the business to maximise shareholder value in the short-term. Instead we’re driving the business to maximise sustainable customer value delivered over the longer term (reasonable shareholder value will follow from this).
By putting customers first, we’re also signalling to our employees on which side their toast is buttered.
For our team of developers, we’re signalling that ICT is the means by which we deliver customer value, which is what we all need to be focused on.
I have previously posted about how it appears some other software companies appear, to me, not to be driven in this way.
For the team of marketing and salespeople we will be hiring, this means there won’t be extravagant expense accounts, long lunches or golf days – unless they contribute directly to delivering customer value.
I’m still puzzling about what kinds of incentives to structure for the salespeople, as we only want to maintain our high client retention rate – which might be affected if the salespeople were incentivised to sell software to those to whom it would provide lower real value.
C. In Greater Detail
In reading the details below, please keep in mind that this listing is part aspiration and part current reality.
1) Across the Company
We’ve all heard of the adage “under-promise and over-deliver”.
I understand the reason why people subscribe to this point of view, but for me it has always seemed disingenuous. To me, there are four parts of this issue:
(a) Knowing what you want/need to deliver;
(b) Being able to deliver it;
(c) Promising to deliver exactly that (no more and no less); and
(d) Then meeting that commitment.In other words – promise to deliver, then deliver.
We are not performing any of these to the high standards we have set for ourselves, but the above is what we aspire to.
2) Within our Division for Software Development
Frequent readers of the blog will have noted that the title “Discerning, Developing and Delivering What the Customer Wants (or Needs)” (or DDD WCW - yes, ROFL Ben) has been used as the descriptive title for this division.
My purpose in choosing this title was not to tongue-tie everyone – rather it was to signal that our primary goal in the development of our software is truly to put Customers First.
Within this division, there are several aspects of our business.
(a) Customer Support
We’re going to continue to screw up, occasionally - we know this.
Maybe our software won’t work for you, or do exactly what you need it to do, or maybe we’ll personally do something that disappoints you.
Even when we do screw up, we want you to anticipate calling us will be an enjoyable experience – we will treat you well, your issues will be resolved with a minimum of fuss, and we’ll end the call with a smile on your face.
We want to provide a truly remarkable level of customer support.
(b) Eliciting Client Requirements
We have had some successes, in the past, in understanding your needs and developing software to suit this:
1) Within the Australian NEM, products such as NEM-Watch, NEM-Review, deSide and ez2viewAustralia all deliver on client needs.
2) In Ontario, we know that ez2viewOntario has also met the needs of a broad range of clients since it was first introduced in 2002 (however we accept that we could have done much better in the ongoing development of the software).
With the recruitment of our GM for DDD WCW, we are taking steps to ensure that this capability is scalable, and sustainable without requiring my direct ongoing involvement.
In the process of understanding what you want, we will have a focus on the whole product . In “Crossing the Chasm”, Geoffrey Moore describes this as what pragmatist customers seek in a product before they buy it – hence we need to consider how our software interacts with whatever other systems you have in place (database systems, process control systems, and others).
By focusing on the whole product, we will ensure that we consider the Value delivered to our customer as our primary metric of success. We keep in mind that:
Customer Value =
Customer Benefit -
Cost to the CustomerThis means we will be focused both on the Benefits customers receive from use of the software, and the Costs incurred (both directly and indirectly) in the use of the software.
In order to see Value from a customer’s perspective, we need to create a culture that ensures we can put ourselves in a customer’s shoes.
(c) Developing the Software
We understand that it’s highly unlikely we’ll fully understand what our customers want/need before we commence the coding of the software. Hence, we will need to continuously check back with customers as the development progresses to ensure we’re still on the right track.
It’s for this reason that we’re implementing an Agile-based software development methodology.
We will continue to look for new ways in which we can include our customers more closely in our development processes.
3) Within our Division for Marketing & Sales
Given we have not yet commenced the process of hiring our GM for Marketing & Sales, I have yet to spend as much time thinking about a catchy title for this division.
In general terms, this division will be the one responsible for initiating, and maintaining the relationship with the customer.
To do this, those in the marketing & sales division will primarily see themselves as problem solvers for our clients. We want customers to tell us what keeps them up at night, trusting that we will do our best to solve their problems (even if that solution does not include any of our current suite of software).
Very refreshing, and exactly the way I believe it should be done.
Software needs to be built for customers not for development, not for sales, not for product management!
The ‘account management’ approach is often seen as an overhead because it’s difficult to link to direct revenue generation, especually when organisations measure quarterly or even monthly. (been there, got the t-shirt, had to deal with the resulting frustration and dissatisfaction!).
The idea of what a customer needs is a business translation of what a customer wants, and is all about qualification, and that’s generally a communications attribute.
Hi Adrian,
Missed this comment beforehand.
I am particularly pondering about your statement :
and will have to give that one some further thought!
In our experience, sometimes customers might be good at recognising a problem they have, and suggesting a solution, but it may not turn out to be the optimal solution (even if it is just for them).
In other cases, sometimes customers don’t even recognise they have a “problem” because it is just related to the way they have always done things.
Cheers
Paul
I completely agree with the importance of engaging with customers at every stage for requirements elicitation. But sometimes customers don’t know what to ask for because they’re used to working with (or round) what they have. The iPhone didn’t emerge from implementing everything on the customer wish list. Sometimes the real breakthrough features in software come from observing the customers using the software and by understanding enough about their business to be able to suggest what might be useful for them. Use focus groups and wish lists by all means, but don’t rely on them alone.
As for rewarding sales people, how about customer satisfaction? Or how the customer rates them personally? Or how many referrals from their customers? Not the whole story, and maybe we’d all be uncomfortable having those measures, but it plays to the principle of putting the customer first.
Thanks for the comments, Guy,
Regarding Customer Wants -vs- Needs
I believe that a bit of both is needed, as in:
1) Initially (e.g. for anyone new to our company, or the industry) we start with asking about what the customer wants as the first step in getting into their heads.
2) Then as we begin to gain familiarity with how our market works, and what keeps our clients awake at night, we can start to see patterns from an external perspective that an individual client might not otherwise see (an external perspective often helps) - in this way we can progress to what the customer really needs, but maybe can’t explain clearly, or maybe does not even acknowledge consciously.
This is why the position description for our General Manager for Discerning, Developing and Delivering Software for our customers is written to start with Wants, and progress to Needs.
Our NEM-Watch product, for instance, was developed in this way:
STEP 1) I had a talented software developer throw numbers on a table on the screen (thanks Jon!) because he was sick of hearing us moaning about how we had not easy view of what was happening in the market.
STEP 2) Spurred by the knowledge that such a product was possible (remembering this was still very much in the dial-up ages in 2000), my visualiser’s mind kicked in, and we rearranged the data on a map and added other features to make it understandable.
Thus was borne a product that met many customer’s needs (needs which, in most cases, customers had not verbalised before - certainly not to us).
Regarding Incentivising our Salespeople
Many thanks for the good suggestions - I will give them further thought and see how they can be used as part of an overall package.
Cheers
Paul
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