The Covid-19 pandemic has highlighted the role of customers in business. It has become dramatically clear to many that without customers there is no business. Now when everything is upside down it is timely and relevant to reflect on this old but fundamental issue. Not that managers would not know it, in principle.
It has for decades been suggested and widely accepted that companies and other organisations should be customer oriented in order to be successful. But what does it really mean to be customer oriented and how is it visible to customers? Is it easier said than done? And what is customer orientation, by the way, in times of change like the extreme disruptive pandemic we are experiencing? Let us imagine three faces or mindsets of customer orientation.
1. Customer orientation as rain dance
Most companies claim to be customer oriented. It is clear that it is supposed to be a mindset applied throughout the organisation that is implemented in actions. What it means in practice is not always clear inside the company, or outside of it. But it sounds good and feels mandatory to say.
Customer orientation is like a rain dance. Rain dance is an ancient practice in hope of inducing rain. Whether it solves the draught problem or not is not the issue, the actors tend to really believe that it helps and is worth the effort. Or perhaps a more relevant metaphor in these times, customer orientation is like a face mask. The real face remains hidden to the customer.
2. Customer orientation as collecting data
Often customer orientation is explained as knowing the customer and staying close to the customer to stand out as different, compared to competitors in the industry. This means collecting data about customers’ needs and wants and monitoring their satisfaction with the company. Listening to the customer is obviously not always easy or successful which is demonstrated by even big companies losing customers and going bankrupt. Not to talk about start-ups that never get flying.
On the other hand, there are those that claim that you should not rely too much on what customers say in your attempts to be customer oriented. There is a danger in being customer-led, it is argued – customers do not know what they need – instead you should be guided by your own visions. As evidence, there is a famous quote attributed to Henry Ford saying, “If I had asked people what they wanted, they would have said faster horses.”
In fact, it has not been verified that he actually said that, but he could have. He created the successful Ford Model T, and the rest is history – in terms of car production processes. But perhaps he was no visionary in terms of putting customers first. Asking customers, he might have discovered that they did not long for faster horses as he presumed but to get rid of the daily chores of keeping a workhorse. What he created was a mechanical horse that you do not need to attend to many hours a day – unless it is your hobby.
Anyway, data is not enough, not even big data unless it can be interpreted and converted into understanding and actions. This puts the stress on asking the right questions – those that reveal customers’ logics rather than enforce the company logic.
3. Customer orientation as customer orienteering
In times of change and disruption, customer orientation becomes a different challenge. Instead of thinking about customer orientation as a characteristic of a company, it might be better to focus on what it might be as an activity. In the Swedish language “kundorientering” (customer orientation) has both meanings. But as an activity “orientering” (orientation) has also another meaning, it refers to a sport that in English is called orienteering.
Orienteering stems from 1886 in Sweden where it was used in the military with the meaning of crossing of unknown land with the aid of a map and a compass. It later became a competitive sport for military officers and civilians. Customer orienteering could be used as a metaphor for finding the direction or location of customers in dynamic and emerging markets. The manager’s mindset is the map and the compass is a set of tools and methods that indicate the direction. Both need to be reviewed and reflected on, in times of change. Mindsets are, however, not easy to change.
Customer orienteering could be seen as finding new ways to understand customers’ changing logics and position oneself in the pattern of customer activities and aspirations. Rather than focusing on industry issues and differentiation in relation to competitors, the issue is to be relevant to customers, whatever that is in changing business landscapes. The pandemic is an extreme example of that. To navigate forward it might help to think about customer orientation as customer and market orienteering.
Tore Strandvik is Professor Emeritus of Marketing at Hanken. He has in his research over the years focussed on managers’ and customers’ mindsets.