Bright Cherry Blog
Stop servicing shareholders!
Silvia Myers, Founder of Bright Cherry
16 May 2016
“Stop servicing shareholders?! Who is this person and has she gone crazy?!”
Ok, I agree, the statement is a little controversial. But before you abandon this page, hear me out just a little more and perhaps you’ll end up changing your mind forever.
It’s all about delivering value.
All businesses understand that in order to be successful, they have to create, add or deliver value for and to their customers. There is no doubt about that. Delivering value is a must. Period.
History has observed countless numbers of companies succeed when delivering excellent value however strange that value has been (e.g Pet Rock by Gary Dahl). In turn, we’ve seen many companies fail because their product or service wasn’t adequately satisfying a customer need or want (e.g Kodak).
But if the need to deliver customer value is so obvious why aren’t all businesses obsessed by mastering what it is?
Delivering value to the right customer.
Businesses are obsessed by mastering the value add, however, delivering excellent value isn’t enough on its own. A business needs to be able to deliver value to the right customer as well.
You’d be surprised how many organisations deliver excellent value to the wrong customer and therefore don’t achieve the benefit they deserve. It sounds like such a rookie mistake and yet it’s so common even in well-established organisations.
“Throughout my career, I’ve seen organisations focus on delivering profit to their shareholders at the expense of real customers.”
By real customers I mean those ones who buy our goods, pay for our services and have our bills covered. Not just the ones who give us money because they trust that we’ll make them more money.
You might ask what’s wrong with that and why does it become a problem. The answer is simple- it won’t work in the long run.
The impact on the end customer.
If the primary focus becomes making money for investors, it will take over the entire strategy and become an indicator of success. With this being the primary measurement, it is very likely that it will be passed down the organisational chain in one form or another.
As a result, the real customer will be forgotten. It won’t matter what he or she is thinking or feeling. No one will care what that customer actually wants and needs as long as value has been generated for the investors.
That’s how organisations across the globe end up with offshored support centres whose primary KPI is how fast they pick up the phone rather than help customers with their inquiry or focus on preventing the inquiries in the first place.
In the short term, a strategy such as this may work. However, it will never work in the long term. Not now when the end customer has more choice than ever, not now when we live in ‘The Age of The Customer’.
“Customers (and rightly so) dictate what they want and need and only companies that are able to adapt to that will remain successful.”
The customer doesn’t care about the shareholder but if the organisation cares about the customer, it will be met with loyalty and rewards that will greatly benefit the shareholder too.
So where to from here?
The very first step in getting priorities right is properly defining who the customer is. Speaking about ‘mums and dads’ or ‘SMEs’ doesn’t quite cut the mustard anymore.
“To remain relevant in this competitive age, companies need to define their customers in a lot more detail and bring them to life.”
Questions like ‘Who is that person that we service thirty times a day?’, ‘What does she care about and what does she do in her spare time?’ or ‘How can we help make her successful?’ need to be thoroughly answered, agreed on and jointly understood.
Organisations need to understand who lives behind their records and countless transactions and how can they deliver value to these people. How can their lives be made easier and what does it take to add a cherry on top?
“If you know who your customers are, you can figure out how to make them happy. Once they are happy, your shareholders will be too.”
But to achieve that, you need to put your real customers first. So please, stop servicing your shareholders.
Silvia is the Founder of Bright Cherry, a customer centric consultancy specialising in helping entrepreneurs and small business owners understand their customers and build successful businesses around that. The fact is that 90% of entrepreneurs fail and one of the reasons is that majority of businesses don’t understand their target market. Get in touch to join the growing network of successful entrepreneurs committed to reach new heights through delivering to their customers’ wants and needs.