Why Organisations Become Less Customer Centric Over Time

(Excerpt taken from Stephen Hewett's paper "The right way to do the right thing for the customer")

In short because they

1. Lose focus,
2. Lose stamina,
3. Get complacent and
4. Get lazy.

When organisations first start trading they usually (and certainly should) have a clear idea what they are in business to do, who does what, and why. Every person involved in a start-up will most likely know how they add value to the finished product or service and whom they need to work with internally to make sure the best service or product is delivered to their new customers. They will know this because looking after the customer is so completely why they set up the business in the first place.

But then, if the new business succeeds, it will grow. To start with, as it grows, the founders and the new staff may be able to keep alive the flame that embodies the spirit of why they are in business. But sooner or later, somewhere along the line, the flame will diminish or even go out completely, as the clarity of why you are in business fades. Once that clarity starts to fade, Customer Centricity fades with it.

Why does this happen?

To speak generally, one has to say that as organisations grow in size a curious effect almost invariably occurs. Staff members start to look inward, worry about their own internal departmental issues and become more and more remote from the actual agenda of the customer.

Internal management processes arise that have little or nothing at all to do with adding value to the external customer. It’s common for whole new business areas and departments to be created to deal with and manage these internal issues. .

The trouble is, too many large organisations forget that people don’t just work for money, but satisfaction too; and they don’t ensure that their staff are encouraged and empowered to look after customers properly. This is particularly so for staff working in internal departments that don’t have a direct interface to customers, though it often applies to customer-facing departments, too. When people in those internal departments perceive that the organisation doesn’t empower them to take steps to understand their role in looking after customers, they forget they are part of a ‘chain’ of organisational resources aligned to allow the organisation to do its very best for its customers and consequently start to drift and lose focus at a motivational level.

In practice, within a large organisation it is almost inevitable that most of its departments will not be customer-facing. And here the very size of a large organisation can conspire against it being successful. The organisation needs to be certain, at all times, of what every individual person and every department is doing that adds value to the paying customer by providing top-quality products and services to customers directly or by doing things that directly facilitate the provision to customers.

After all, if any one individual or department is not involved in the chain, it needs to be asked what exactly they are doing in the organisation at all.

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(Download the full whitepaper “The right way to do the right thing for the customer”)