Mirror Mirror

July 2, 2019 at 3:43 pm | Blog

Peter Drucker said “90% of information used in an organization is internally focused and only ten percent is about the outside environment. This is exactly backwards.” This may be one of the most telling business quotes of all time.

 

We often see companies that are wrapped up in themselves. Their self-image – who they think they are and how they want to present a culture or brand – is often sideways from what their customers value. These self-image visions often take on an exaggerated importance, while their customer focus suffers.

 

They will spend more time and money on internal meetings related to brand, mission, vision and culture statements, than they will invest in customer feedback. The problem: Customer feedback should dictate brand, mission, vision and culture. This is what Drucker meant when he said most companies have it exactly backwards.

 

For example, some companies are in love with the fact that they are “tech savvy” or like to promote that they are “leaders” in their industry (along with ten other competitors making the same claim). Some love to tout their generations of being in business.

 

We have seen manufacturers get carried away with innovation regardless of whether it means much to their customers. Some dig themselves into holes “because we can.”

 

Innovation is certainly important. But not innovation for innovation’s sake. New advances must be relevant. How many of us use only a handful of the innovations on our phones? Yet the phone industry has geeks writing code for new bells and whistles at Mach speed.

 

This applies to services as well as manufactured products. In efforts to outdo the competition, companies are often adding extra services to “create a competitive advantage” before they determine if it is valued enough to be worthy of the effort. Frequently, the expense often outweighs the resulting market share or profit increase.

 

Make sure your business’s planning efforts reflect your customers most desired deliverables. Don’t be mesmerized by non-essentials; for example, don’t brag about adding extra salespeople to offer post-sales support, if, in your world, your customers rate post-sales support low as a need. We have seen this specific issue occur several times.

 

Protect your margins by making relevant internal decisions based on external input. It’s simple.