As an American Jeff Bezos is untypical in his long-term and customer-centric approach to business. The success of Amazon speaks for itself.
A big source of misunderstanding between Americans and Germans, rarely made explicit, is about whether business should inherently be customer-centric, supplier-centric, or somehow balanced, as our fourth column in this series explains.
Germans and Americans alike will of course say they care about their customers. But they associated different meanings with that notion. And that often leads to misunderstandings and frustration. American providers of business services proudly offer exactly that: a service. By contrast, German providers view their proposition less as a service and more as a consultation. The difference is subtle, but consequential.
Henry Ford, the founder of the Ford Motor Company, had a reputation for ignoring customers’ requests. Two of his more famous quotes are:
“If I had asked people what they wanted, they would have said ‘faster horses’” and “Any customer can have a car painted any color that he wants as long as it is black.”
Consumer products giant Procter and Gamble sold its hair products business and its fragrances division, including the struggling German brand Wella.
But some criticism of Wella had been going in the other direction, namely that innovations happen too impatiently, and that Procter and Gamble thinks in the same fast terms as in the drugstore-based consumer products business.
Hairdressers in Germany, however, want to use the products they know over the long term, providing that they have had positive experiences with these products. Too many new things annoy them.
When it acquired Wella, Procter and Gamble bought its way into an unfamiliar field, namely the hair salon business, said a manager with a competitor. Then the company cut off the brand’s roots by closing Wella’s headquarters in Darmstadt, Germany, thereby losing institutional knowledge and the confidence of its vast network of hairdressers.
According to the manager, a former strength of Wella, namely their sales reps’ good relationship with hairdressers, was lost.
Source: Handelsblatt Global Edition. June 10, 2015. “The Great Brand Sell-off.” By Christoph Kapalschiniski.
Information: For a close collaborative effort between customer and supplier (consultant, vendor, etc.) to function effectively in the American business context a high level of communication between the two parties is essential.
Information flow is guaranteed via short-term feedback between customer and supplier during the entire business relationship. This allow customers to modify their requests depending on changing situations.
Results. Because the customer exerts such a certain level of control over the external expert (the how as well as the what), the expert is held accountable exclusively for the work dictated (ordered) by the customer.
How the results might affect related areas within the client company remains the responsibility of the customer. Responsibility cannot exceed scope of work.
If to consult is to provide advice, then that advice might, perhaps should, include what the customer needs to hear, but does not want to hear. A fine line. How to walk it? To withhold that advice could mean to underserve, or even damage, the customer. To provide that advice, however, could damage the relationship.
If true friends are those who tell you what you need to hear, but surely you do not want to hear, at the risk of damaging or destroying the friendship, aren’t true suppliers-vendors-consultants those who do the same?
Collaboration: To work jointly with others or together especially in an intellectual endeavor; to cooperate with or willingly assist an enemy of one’s country and especially an occupying force; to cooperate with an agency or instrumentality with which one is not immediately connected. From Latin com- together + laborare to labor.
Input: Something that is put in; power or energy put into a machine or system for storage, conversion in kind, or conversion of characteristics usually with the intent of sizable recovery in the form of output; a component of production such as land, labor, or raw materials; information fed into a data processing system or computer; the means by which or the point at which an input (as of energy, material, or data) is made; the act or process of putting in.
Accountable: Subject to giving an account, answerable; capable of being accounted for; explainable.
To serve the customer is to deliver what the customer has ordered. No more, no less. Quickly. Precisely. Fulfilling the order. Full. Filled. Unless asked, a waiter does not discuss with the customers the wisdom of their choice from the menu.
To consult the customer is to enter into the decision making process, to co-discuss, to co-think. To discuss with, think with. Perhaps initially just as a sounding board. Then later as a provider of information, input, advice. At the highest level, acting independently, but in the spirit of the customer’s wishes.
Stages. From order-taker all the way to co-thinker and co-decider. Grades. Gradations. Graduation. Gradual. From serving to partnering with. And there is a fine line between each phase, at each transition.
If the lines are identified, understood and managed (walked carefully), the collaborator is graduated, “makes the grade.” If misidentified, misunderstood, therefore mismanaged, the collaborator is not graduated. The business relationship might be terminated.
The first step an American supplier will take is to gain a deep understanding of the customer‘s needs. Because these aren’t always so concrete, they must also try to identify the perceived needs. The relationship with the customer should be highly collaborative on all levels, from the beginning to the end.
The American supplier, vendor, consultant, constantly strives to make sure that they are “on the same page” with the client. In fact, they work literally side-by-side with the client, going to the client’s place of work and completely adjusting their schedule. They maintain continuous dialogue throughout the process so that they always understand the client’s needs and desires, especially as they change.
This includes knowledge-transfer agreements, which detail when the customer will be able to do something on his own, without supplier assistance, so that he begins to take over the process.
Results: Because the customer exerts such a certain level of control over the external expert (the how as well as the what), the expert is held accountable exclusively for the work dictated (ordered) by the customer. How the results might affect related areas within the client company remains the responsibility of the customer. Responsibility cannot exceed scope of work.
Information: For this collaborative effort to function effectively a high level of communication between customer and supplier is necessary. Information flow is guaranteed via short-term feedback between the customer and the supplier during the entire business relationship. This allow customers to modify their requests depending on changing situations.