Saturday, February 5, 2011

Employees & Owners Needs/Wants

Basic Business Cents

Understanding Employees and Owners Needs & Wants

Every organization has three constituents that which they must satisfy and delight-customers, employees, and owners. In the last article, we discussed in length the questions to address to determine the needs and wants of customers. Important as that is, we cannot overlook the other constituents of our organization. Building on the discussion of needs versus wants in the customers’ needs/wants article, let’s see how it applies to employees and owners.

We want employees to not only be satisfied with what is provided for them today, but to make them enthusiastic about the future of the organization and their role in it. Managers must obtain information about employees’ feelings to understand what is important to the employees. What do they enjoy in their work? Do they feel they are doing something worthwhile? Do they feel the job offers them opportunities for growth? Once these and other questions are answered, managers will have a prediction of what provides intrinsic motivation, which Dr. Deming notes is the strongest motivation of all.

Some questions to be addressed regarding employees are:

1. What are the articulated needs of our employees?

2. What are the unarticulated needs of our employees?

3. How would our employees rate their pride of accomplishment?

4. How does our employee turnover rate compare with our competitors?

5. Do our employees operate with a spirit of teamwork?

6. Do we have mutual trust and respect between our employees?

a. Between employees and management?

b. Between employees and customers?

c. Between employees and suppliers?

The third major driver of the organization is the needs and wants of the owners. They deserve the same consideration given to customers and employees.

Some questions to be considered regarding the owners are:

1. What are the articulated needs of our owners?

2. What are their unarticulated needs?

3. What is their level of satisfaction with their investment in the organization?

4. How comfortable are they with the direction of the organization?

5. How deep is the mutual trust and respect between the owners and management?

By truly understanding the real needs and wants of the three constituents of our organization, we have the basis of development of plans for the future. They are three of the twenty-one areas to research in order to develop a winning strategic plan. Details on the other categories will be discussed in future articles.

Customer Needs/Wants

Basic Business Cents

Understanding Customers’ Needs & Wants

Some years ago a major oil company was conducting research on a new design for milk bottles. Sound strange? They did not make milk bottles but they had customers who did. They supplied synthetic resin used in making plastic milk bottles and by helping their customers succeed, they ended up selling more plastic resin. Their customers did not ask them to do this and may not even have been aware that they needed a new design. Customer wants and needs may not be the same thing. It is important to know what questions to ask to find out true needs of customers and those we hope to become customers.

The objective of this article is to identify, analyze, and better understand through research the needs and wants of present and potential customers. The research should be based on customer surveys/interviews, customer evaluations of products and services, customer service reports, sales and marketing data, general review of the literature, etc. Dr. Deming often said the customers’ expectations are shaped by what we, and our competitors, lead them to believe they can get. If we are not out in front giving them more than they asked for, our competitors might do so and raise their expectations. We should always be working to delight our customers and creating a situation where they enthusiastically boast about the benefits of doing business with us.

Among the questions to be addressed are:

1. Who are our present customers?

2. What is their profile?

a. How are they similar and how are they dissimilar?

b. How do we segment them?

3. What new customers would we like to have?

4. How is their profile different from our existing customers?

5. What customers have we lost and why?

6. How is their profile different from our satisfied customers?

7. How satisfied are our present customers?

8. What are our customers saying about our service that we are not listening to?

9. What are the quality requirements of our major products/services which are demanded by our major users/customers?

10. Which customers are more preferable and why?

11. How will customers make purchasing decisions?

12. What are the customers articulated needs?

13. What are the needs of the customer that he/she has not or cannot articulate?

14. What are the articulated needs of the organizations that are not now customers but whom we would like to be customers?

15. What are their articulated needs?

16. What criteria influence each customer’s needs?

17. How important is each?

18. What in the future may affect these needs and criteria?

19. What is value-added for the customers?

20. How can customers’ expectations be exceeded?

21. What are the “must be” quality dimensions? These are the features that will cause dissatisfaction if missing but will only bring satisfaction to the customer if provided. An example might be good brakes on an auto.

22. What are the “linear” quality factors? These are the features that if missing will cause dissatisfaction, the presence of a certain amount will satisfy the customer, and the presence of an additional amount will surprise and delight the customer to bring them to a level where they will brag about the product/service to their friends. An example might be gas mileage experienced on that new auto.

23. What are the “attractive” quality parameters? These are the features that are not expected so the absence of them will not dissatisfy the customers because they are not expecting them in the first place, but the presence will surprise them and delight them. An example might be an invisible infrared light source on the front of the auto that detects deer or pedestrians on a night-vision panel on the dashboard.

24. How do you measure effectiveness?

25. How do you influence customer loyalty?

The customers’ needs and wants should be based on data, plus a prediction of the future. Then we can provide that “extra something” to create enthusiasm in the relationship and enhance our chances for long-term success.

Study the Competition

Basic Business Cents

Learning from the Competition

Sam Walton was fond of saying that he had been in more Kmart stores than any Kmart executive. He started a Wal-Mart culture of visiting with customers, employees, and competitors in the field to constantly come up with new ideas for continuous improvement.

Visiting aimlessly profits nothing. Just like the saying, “The best extemporaneous speech is well rehearsed”, the best visits are well planned. Some questions about your competition to be answered are:

1. Who are your competitors today and what are their strengths and weaknesses?

2. What rival product/service is most competitive with your product/service?

3. What studies do you have comparing your major product/service with your rival’s product/service in respect to the quality requirements demanded by your major users/customers?

4. What differentiates your products/services from your competition?

5. What are the major strategies and thrusts of the competition?

6. In what new directions are competitors moving?

7. Where are you vulnerable to competitors?

8. Where could unknown competition appear?

9. What are competitive trends?

10. What minor competitors could become major?

11. In what areas that customers care about are you stronger than your competitors?

12. Answer why to each of the above questions.

Be sure to supply data wherever possible and not just opinions. To get this data you need to venture out of your environment and into that of your competition.

Dr. Deming used to say, “Nothing is so pervasive as a lack of a good competitor.” Complacency from a lack of a good competitor can cause us to relax and fade away. Studying good competitors can motivate us to excel and prosper.