Long Range Planning, Vol. 26, No. 3, pp. 95 to 102, 1993 0024-6301/93 $6.00 + .

OO 95
Printed in Great Britain 0 1993 Pergamon Press Ltd

Innovation Bv Listening /
Carefully
to Customers
Fernando Flares

The author offers a dramatically different way of listening to most people would like to live together in relative
customers in today’s rapidly changing business world. Com- harmony, to survive our differences, to give and to
pany representatives would go beyond the stated wants and
take, to sell and to buy, and, as the twenty-first
needs of potential customers. They would listen for the
unspoken concerns the customer has about the future, behind
century approaches, to adopt new ways of listening
their words, behind even their body language, facial ex- to each other-active listening, engaged listening,
pressions, gestures, and all the rest. These listeners would heedful listening. Statesmen are adapting to this
expand their focus to include the customer’s moods, predispo- need, and so, too, must companies that expect to
sitions, culture and background, the problems and oppor-
trade competitively in markets that span the globe
tunities that they are facing now, and those they may be facing
in the future. What remains unsaid-even what is simply taken
and demand a multiplicity of choices.
for granted-is often the most important part of the conversa-
tion. Listening, as discussed here, is more than the inform- The traditional ways of doing business are no longer
ation-gathering of traditional market research. Listening is adequate. Serving a predictable market with generi-
establishing and building rapport, with the goal of creating a
cally designed products and services is a thing of the
different, more collaborative relationship with the customer.
Listeners concentrate on the key distinctions that can serve as a
past. It is not enough any more to gather statistical
bridge between their world and the customer’s The skilled information on the largest possible market and then
listener becomes ever more sensitive to how a customer’s past serve it at the lowest feasible cost. Today’s global
has shaped his or her view of the market and the world. trade is not driven by product or market, but by
Company representatives bring their own backgrounds to
customers’ wants, whether what they want is clearly
illuminate customers’present situations in new ways, and help
them invent opportunities for the future. Then those listeners
expressed or vaguely implied.
are in a position to explore the kinds of products and services
that will produce the best value for the customer, where those Customers now demand that a company’s offerings
offers can be improved, and what new offers can be invented. be individualized to meet particular needs, situations
and lifestyles. And they want products and services
of superior quality available promptly. Never
before has such a burden been placed on managers.
The requirements are for innovation, flexibility,
The world experiences upheavals from time to time improvization and, above all, thoughtful anticipa-
that change forever the way we do things. Christo- tion based on active listening to customers so as to
pher Columbus stumbled on an unexpected island determine their concerns. Being prepared to deliver
and humanity was never the same again. The on such requirements will require companies to
harnessing of electricity opened the way for wholly cultivate new practical competences, to redesign the
unpredictable technologies in power, light, habi- ways they do their work through business processes,
tation, transportation, communication and just and to orientate themselves to their customers in a
about everything else. Now we are talking of the new way.
vast expanse of the planet as a single global village.
Ideology and religion, distance and time, ethnicity
and language are no longer the barriers to business
that they have been in the past-the same blue jeans
Listening is More than Hearing
dance to the same rap beat in Novosibirsk as in New In America’s contemporary youth culture, a fre-
York City. quently heard phrase is ‘Do you see where I’m
coming from?’ This replaces the old-fashioned, ‘See
Somehow, amid all this ever-accelerating change, what I mean?’ But we might use it for our purpose
here as a starting point for understanding the
Dr Fernando Flores is Chairman of the Board and Founder of Business dramatically different way that we do business in
Design Associates, Inc. our changing world today. It is no longer enough to
96 Long Range Planning Vol. 26 June 1993

know where we ourselves are coming from, given reporting: ‘. . . Edsel was named for the father of the
our education and background, culture and context, Company’s president, like a nineteenth-century
habits and prejudices. We must concentrate even brand of cough drops or saddle soap. As for the
more on where potential customers are coming design, it was arrived at without even a pretence of
from. Are we truly hearing what they are saying, consulting the polls, but by the method that has
over the din of our own experiences? Are we been standard for years in the designing of automo-
hearing it in the context of their culture, education biles-that of simply pooling the hunches of sundry
and background? Or are we hearing only what we company committees’. Barabba and Zaltman cited a
arc telling ourselves, without the benefit of insight contrary example in Akio Morita, the founder of
into where customers are ‘coming from’, and, miraculously successful Sony, who scoffed at mar-
consequently, probably mishearing them? ket research, saying: ‘Our plan is to lead the public
to new products rather than ask them what they
Listening to build a true collaboration with the want. The public does not know what is possible,
customer may prove a challenge-a difficult skill to but we do’.’
master-to many, it requires more than simply
hearing and understanding the words. It demands
attention to other aspects of conversation: body
language, facial expressions, gestures, tone of voice,
and all the rest. More importantly, it calls for
Some Listen, Some Don’t
empathy, getting inside the speaker’s mind and The kind of listening we are talking about here,
mood, pushing past his or her own assumptions that going beyond market research to the individual
leave much unspoken. For what remains unsaid may concerns of customers, could have spared Ford its
hold the most value, while the words are often mere Edsel embarrassment. More recently, it could have
‘window-dressing’ rhetoric. alerted U.S. businesses to the need for reform in the
relationship between customer, provider and sup-
To illustrate, let us imagine two men sitting in a plier that comprises the&St-in-Time (JIT) approach,
sweltering railroad car travelling near Calcutta. which was pioneered in Japan in the 1950s and now
Each is sweating profusely. Each can see that the seems to be catching on everywhere. Ironically, JIT
other is equally uncomfortable, broiling away in had its roots in America-specifically, in American
silence. And then one says, ‘Sure is hot in here’. The supermarkets-but it took an observer with a
other grunts, ‘Sure is’. On the informational level, different background to grasp its significance.
not a scrap of anything new has been conveyed. Today, many American producers are chastened by
And, yet, something important may have taken Japanese success with the theories of Dr. W.
place all the same. The way has been cleared for Edwards Deming, whom they ignored when he
many possibilities of profitable friendship based on originally presented his ideas. Still, many also have
mutual discomfort made into a bonding experience trouble accepting JIT, which runs counter to
by a banal conversational gambit. On the other American manufacturing tradition.
hand, the second man could respond with, ‘Of
course it’s hot, you idiot’, and a wholly different This tradition, in its basics, dictated that extensive
atmosphere would be created. Once a conversation inventories had to be maintained at all times in order
about the heat began, the two men would be sharing to assure that the machines of mass production never
a potential relationship and future possibilities that stood idle. To guarantee full utilization of equip-
had not existed before. ment, huge inventories were tolerated as a costly but
necessary surplus in the American system. But
Listening, then, is a good deal more than the scarcity, not surplus, was the hallmark of life in
information-gathering of traditional market Japan after World War II, and the prime task for
research. Listening is primarily about establishing manufacturing engineers at Toyota, for example,
and building rapport. To be less than careful and was the elimination ofwaste. Giant inventories were
attentive in this regard is to court failure. out of the question. The answer they found was
JIT-to build only what was needed when it was
A classic example is the Ford Motor Company’s needed, restocking only as each item left the
self-inflicted disaster in marketing the Edsel in 1957. storeroom and was put to use.
The heavily advertised automobile failed to sell and,
amid scorn and derision for everything from its Taiichi Ohno of Toyota, one of the inventors ofJIT,
looks to its name, left the market in 1960. Barabba gives full credit to American supermarkets as his
and Zaltman in their recent book, Hearing the Voice prime inspiration: ‘from the supermarket we got the
of the Market, noted that, although the car’s idea of viewing the earlier process in a production
promoters claimed to have done extensive research line as a kind of store. The later process (customer)
‘on every aspect of the Edsel’s entry into the goes to the earlier process (supermarket) to acquire
market’, whatever information was thus acquired the required parts (commodities) at the time and in
was hardly put to productive use. The authors the quantity needed. The earlier process immedi-
quoted an article by John Brooks in the ately produces the quantity just taken (restocking
26 November 1960 issue of The New Yorker as the shelves)‘.*
 innovation By Listening Carefully to Customers 97

Toyota’s success in listening to other backgrounds to sales that soared to $400m or more worldwide. It
and traditions is by no means unique. also sparked such widespread interest in chrono-
ABN/AMRO, Holland’s largest bank, has demon- graphs and sports watches that an army of competi-
strated a similar sensitivity in growing to be the 13th tors joined Swatch in the field, including Guess,
biggest bank in the world, with 1470 branches, Fossil, Anne Klein, and Timex. Altogether, these
including 417 abroad. Matsushita, one of Japan’s leaders accounted for half the market, but Swatch
electronics giants, has launched a listening pro- stayed ahead with a ‘veggie line’-watches shaped
gramme to hear what foreign managers of its like a red pepper, a cucumber and a bacon-and-egg
overseas subsidiaries have to say; about 100 of them combo, retailing for $100 in a limited number of
are being brought to Japan each year, to work in only 9999 worldwide-that had people waiting in
company offices and factories, not only to learn but line for hours to buy.’
also to report on their experiences to Japanese
colleagues. In this way Matsushita is trying to catch Success has come in a variety of ways to those
up with rival Sony, which for years had been managers who have organized their companies
similarly nurturing its managers, both foreign and around better listening and coordination. Toshiba
Japanese. concluded that its subsidiaries responded to market
needs more effectively ‘by designing and building
Monsanto’s Nutrasweet faces a special problem. products closer to the markets where they are sold’.
The billion-dollar unit will lose its very profitable Consequently, it opened a factory in San Jose,
lo-year hold on the sweetener aspartame with California, adding 100 new jobs, to produce a high-
expiration of its patent at the end of 1992. It is capacity computer disc-drive designed and engi-
reorganizing ‘along customer lines’ to meet stiff neered at the company’s Irvine headquarters.*
competition from a host of synthetic, low-calorie Another example is IKEA, the phenomenally
sweeteners newly freed to use aspartame. Nutra- successful Swedish company that is now the largest
sweet officials say that they expect to lose $250m in furniture retailer in the world, with annual sales
the first year of free competition. Anticipating over $3bn. Heavily dependent on JIT, it has
heavy penetration by new competitors in its U.S. developed all of its own software to communicate
market, the company is working on new, cheaper electronically with two primary distribution
super-sweeteners-‘we’ve had some customers in centres, filling orders and restocking when inven-
for taste tests’-and is looking around overseas, for tories run low. All links in the distribution chain are
possible acquisitions, mergers and joint ventures. monitored to insure timely delivery of products to
Also, as a result of listening to the shifting concerns retail stores, including 14 in the United States.”
of the ageing baby-boomer market, it is test-
marketing a chain of fitness centres for adults over Body Shop, founded 16 years ago by a husband-
50, a population segment that will expand dramati- wife team in Littlehampton, England, now sells
cally in the mid-1990s.3 about $400m worth of cosmetics annually under a
philosophy devoted to using natural materials and
Few American businesses have utilized listening aggressively preaching environmental protection
for customer concerns more astutely than the (‘profits with principles’). Founder Anita Riddick
McDonald’s Corporation. Now, the fast-food giant says the firm is often viewed as ‘a very flaky, hug-a-
is working with Turner Broadcasting System’s tree company’, which fits the lifestyles of many
CNN on a private television network that would customers, but, like Walt Disney, it rigidly pursues
beam customized news, entertainment and advertis- store uniformity and legal pursuit of copycats, in
ing into its 8600 U.S. restaurants. It would be similar efforts to maintain and protect its key recognition
to CAA’s Check Out Channel in 15 supermarket factor for its customers.‘O Kraft-General Foods and
areas and Airport Channel in passenger terminals in others are exploring the new concepts of ‘partner-
several cities.4 McDonald’s also is putting roasted ing’ and ‘category management’, both heavily
chicken, pizza, lasagne, and other pasta dishes on its indebted to listening to customers, JIT and creative
menus because it found ‘people want something use of modern technology in what John Humble
more than just hamburgers and fries’.5 Stressing and Gareth Jones have labelled ‘a climate for
environmental correctness is another new listening- innovation’.” Partnering and category management
based gambit for McDonald’s. And, moving farther work like this: Instead of depending upon the old
afield but still related to the company’s focus on concept of product/volume driven sales, particular
families, it has opened near Chicago what may be supermarkets are identified, along with the types of
the first of a chain of indoor play centres, not customers, based on lifestyles and demographics,
attached to any McDonald’s restaurant, where who shop those stores. Scanner data reveal top
parents can watch from a quiet room while their products in a category, as well as in a department
children play safety.” and which among them is growing fastest, i.e.,
category management. A partnership can be formed
Listening paid off for Swatch Watch U.S.A., a on the basis of this knowledge between retailer and
subsidiary of SMH, Inc. based in Biel, Switzerland. manufacturer, to the consumer’s ultimate benefitI
Its chronograph, introduced in 1991, turned the
firm around from going under with a dying brand Another kind of partnership made possible Canon’s
98 Long Range Planning Vol. 26 June 1993

development of EOS, the high-quality, extraordin- freedom to move beyond customers’ stated needs to
arily popular autofocusing camera it introduced in explore the whole world of their concerns, and to
1987. Canon had determined the market existed, invent offers that are more satisfying than customers
even though nothing like EOS had been created could have imagined themselves. The result is
before. It combined its proven engineering and greater opportunity for both customers and the
manufacturing expertise with Motorola’s micro- company. A simple example is the case of the man
controller technology, and the happy partnership who enters a clothing store and tells a clerk he wants
flourishes to this day.13 to buy a shirt. The clerk, who is astute, looks at his
customer and sees a young professional probably
All of these examples of effective listening and poised for quick ascent up the corporate ladder. A
partnering represent valuable extensions beyond conversation with the customer confirms the clerk’s
refinements in marketing research or computerized initial impression. He may need a shirt, but he also
linkages of customers’ interests with R & D possibi- wants to look good, impress his superiors and
lities, as described in some recent literature.14 thereby enhance his chances of success. In partner-
ship, the buyer and seller create a future consisting
of, not simply the needed shirt, but suit, socks, tic,
hat, topcoat-an entire wardrobe designed for a
Listening in Action young executive. Similarly, IBM’s early customers
Companies used to be able to control their own expressed a need only for a machine to do
destinies by dictating the conditions of satisfaction in mathematics quickly; what IBM saw was the
the marketplace. Interpretations of the past would possibility of a new way of running businesses, and
create the present market conditions and the future by automating simple, repetitive tasks like payroll-
was predicted by extrapolating from the present. processing and list-making, it sparked a revolution
But, today, customers are striving to invent the that led to discovery of more and ever more
future for themselves, and careful attention must be applications for computers. No customer expressed
paid to discover where they are headed. It is a a need for a Walkman sound system, but soon after
challenge and an opportunity. To take advantage of Sony invented it, everyone had to have music with
it requires a new way of looking at change- them wherever they went. Nike and Reebok
through the eyes of the customer with full under- invented concerns for innovations that elevated the
standing, not only of their needs, but also of their lowly sneaker to high fashion.
world and their concerns for the future.
Organizations like IBM, Sony, Nike, and Reebok
This kind of listening involves keen attention to went beyond listening and inventing future possibi-
customers’ predispositions-how their background lities to execution-they mobilized their resources
structures what they see as necessary, desirable, or to push those possibilities to fruition. That is the
even possible. Predispositions are planted in all of us central issue. Today’s global businesses must inte-
in childhood, arising from the social and cultural grate the activities of teams and individuals on a
environment into which we were born. Some planet-wide scale. This co-ordination must be fast
predispositions fall by the wayside as we gain skills and flexible, adjusting rapidly to changing market
and sophistication, but many stick with us forever. conditions. It requires the rigorous management of
Most Russian children, for example, would not three aspects of providing satisfaction for the
understand a suggestion that they earn pocket customer-business, information and material pro-
money by setting up a lemonade stand on a street cesses, as described in Figure 1.
corner. But most American children would get the
point right away, having seen older siblings and In the traditional material and information pro-
friends cash-in on such rudimentary entrepreneur- cesses, people co-ordinate the acquisition, storage,
ship. Many Russian people are going through the transformation and movement of raw materials,
‘lemonade-stand syndrome’ in transforming cen- parts, products, documents and electronic com-
trally controlled communism to the market-based munications. To ensure that listening for the
economy of democracy. Most do not know how to customer’s concerns runs through the entire com-
do it. Very, very little in their background predis- pany, we have distinguished a third kind of process.
poses them to buying and selling and profit-taking. In business processes, people co-ordinate the trans-
They know all about standing in line, but little actions that lead to customer satisfaction. A business
about comparison shopping. Because companies, process is a linked set of internal and external
too, have predispositions, it will be interesting to see transactions, or workflows, that all share the same
how IBM, regarded as staid and stable, and Apple, basic structure illustrated by the business actions
seen as iconoclastic from the start, get their diagrammed in Figure 2.
managements together in their new relationship.
Obviously, much unlearning as well as learning is in
In this graphic illustration, the four phases of a basic
order.
workflow can be distinguished:

A company representative listening for these predis- A The customer makes a request or the provider
positions has critical leverage. They have the makes an ofir.
 Innovation By Listening Carefully to Customers 99

Business Satisfy customers, l Workflows l Completing transaction

Process complete offers and l Roles and producing satisfaction
requests, satisfy l Acts when a customer requests a
stakeholders, and l Conditions of satisfaction product or service, or a
accommodate custom l Time company offers a new
requests. product.

l Sales order from customer

triggers transactions with
inventory, manufacturing,
and distribution to fulfil.

Information Assemble data into
Process information products, i.e.
inscriptions and records
used to support acts taken
in business processes or
materiel processes.
l Documents and records Order data entered into a
l Data database, computer
l Storage and retrieval, communications for
transmission, manipulation, financial transactions,
assembly, and comparison processing of invoices,
information systems.

Materiel Assemble components into l Product unities Movement of paper in the

Process product unities. l Raw materials and office, manufacturing
components products in assembly lines,
l Transportation, storage, distributing and delivery of
assembly, transformation, products.
and comparison against
standards

Copyright @ 1991, Business Design Associates, Inc. All rights reserved worldwide.
J

Figure 1. Processes for customer satisfaction

Coordination between a Customer and a Performer to fulfill the customer’s

Conditions of Satisfaction.

Request or offer

/- ~#;;I;;;

CUSTOMER

Cycle time

Declaration of
+L&
satisfaction
Declaration of
completion

Copyright @ 1991, Bueirteee Deeign Aueooiarea, inc. All right8 reeorved worldwide.

Figure 2. Business actions to satisfy customers

 Long Range Planning Vol. 26 June 1993

The provider makes a promise to perform, the earnestly on what the customer states as require-
customer makes a promise to pay, and they reach ments, can still fail to satisfy the client in the end.
ugreement, whereupon they have invented a What the emerging global marketplace calls for
future action together. today is competence in listening for partnership.
Market representatives must be trained to listen for,
The provider, once having performed, makes a
not only what customers say they need, but also
declaration of completion.
what concerns they articulate, clearing the way
The customer, accepting the performance, for the invention of possibilities for the future.
makes a declaration of satisfaction. Excellence in producing satisfaction requires high
reliability in sensing customer desires and exquisite
This is the critical link that closes the loop of timing, meaning companies must be constantly
listening. Even after all the work is agreed upon and reconfiguring their operations in anticipation of the
completed, the customer may find that what has customer. Workers must be, not simply retraining
been produced does not really address his or her occasionally, but immersed in constant learning,
concerns. Companies that manage this critical link maintaining a high level of skill, able to work
will be able to keep collaborating with their autonomously, and also serve as mentors to spread
customers to continually reinvent their offers, rather competence throughout the company. As Dietger
than losing them to the competition. Hahn has noted, ‘On the one hand, this means to
delegate responsibility; on the other hand, it
This workflow is quite universal, independent of involves that managers take responsibility, that is,
specific communication technologies, and even of they are willing to justify their actions’.‘5
different languages and cultures. It presents a simple
set of individual elements offering possible ways in Likewise, employees make a commitment to
which people can co-ordinate their actions, to immerse themselves in practical learning on the job,
ensure that they satisfy their customers and invent always reaching for the next level of skill so as to
new possibilities for the future. provide more satisfaction for customers. Figure 3
presents the development of practical learning in a
progression through six levels of competence-
Training and Tools for Listening Beginner, Advanced Beginner, Competent, Profi-
Even the most conscientious company, focusing cient, Virtuoso, and Master. For each level, it

Present lnvolvment
Past Traditions Future Breakdowns
end Diacouraee and Opportunities
Experience lnvolvment Expectation

Master Historical conversations about Observation of and/ Willing and able to Spots unusual Speculatea about how
the evolution of the practice or participation in re-invent the situations and emerging changes in the
and its piece in the culture at hiatoricel changes in practice to suit opportunities for culture may affect the practice
large. the practice. changes in the re-invention. end require re-invention
world context. or modification.

Virtuoso Historical conversations about Past successful Moves without Anticipates the Formulates strategy for
innovators in the practice and performance in the deliberation in the world context end moving in the practice
its relation to different cultural practice in a variety world of the practice, sees the neceaaary according to emerging trends
life-styles. of different contexts. produces excellence action immediately. and likely advances of
in others. leading-edge practitioners.

Proficient Existing community atendarda Paat action in a Performs with Begins to see way* Seeks out ways to improve
of excellence (benchmarks) large number of excellence and to configure performence and make more
and conversations about crises situations and begins to see the resources for efficient use of reaourcee.
and opportunities in the experience of their practice in its world super-satisfactory
current aituation. outcome. context. performance.

Competent Standard practices of the Previous respon*es Can complete the Can set priorities Anticipates concearna of the
community for producing and to symptoms and practice to the and anticipate the client or community and
aaaeaaing aatiafactory initial practical aatiafaction of rlient resources needed breakdowns that could
performance. experience in the or community. for producing prevent satisfactory
domain. satisfaction. completion.

Advanced Existing aphoriame and Previous use of Begins to recognize Begins to spot Anticipates breakdowns
Beginner rules-of-thumb for dealing with rules relating aspects of the future breakdowns beyond his competence and
aituationa identified by the features of the practice situation and opportunities speculates about what must
presence of various aymptoma. enviroment to assymptoms for signalled by be learned next.
correct actiona. future possibilities. symptoma.

Beginner Basic distinctiona and existing Previously learned Followa rules, Can anticipate only Oriented toward aatiafying
traditiona of instruction in the practices in related instructions, and what the rules say the instructor by applying
practice. domains. previously learned will happen. rules correctly.
standard practices.

Copyright @1991, Business Design Associates, Inc. All rights reserved worldwide.

Figure 3. Competence levels for employees

 Innovation By Listening Carefully to Customers 101

outlines a person’s past background and experience, the client’s units do today, what are their
their present capabilities, and the kind of orientation production and co-ordination standards and
they may have as an employee toward the future. what new offers is the customer pursuing? What
can you draw from your own experience to
Cultivating the skill to build trusting, collaborative enhance the client’s everyday co-ordination of
relationships, customer representatives become a action in the future?
different kind of observer of customers’ worlds. In
Training in Existing Internal Practices-What are
Figure 4 we outline one set of observations that
the client’s educational assumptions and prac-
representatives might use to orientate their listening
tices, and which do you share? What are the
and learning. These are not the only questions to
customer’s views on current employee training,
consider in listening for a potential customer’s
employee development and needed skills for
concerns, nor are they necessarily the right questions
new offers? What can you draw from your own
for every corporation. But they illustrate the tone
experience to promote competence and learning
and direction that are necessary for developing a
in the client’s company for the future?
collaborative relationship with customers.
Companies throughout the world are beginning to
The chart can serve also as a reliable checklist or
see this kind of listening as a competitive necessity.
questionnaire for managers who might like to
U.S. automakers, showing a comeback that is
measure their own organization’s listening poten-
looking stronger and more intelligently crafted than
tial. It can be summarized into four principal areas:
expected, are enthusiastically collaborative in their
Mission of Customer in World Context-What approach to buyers. General Motors, for example,
client concerns are inherited or historical, and launched a programme to replace without charge,
how do they connect with your own? What are rather than repair, a variety of new engines that
the client’s present declared mission, standard drew buyer complaints in late 1991. Among the
practices and emerging concerns? How to help 1992 models involved were some versions of the
redefine the client’s market identity in the Buick Skylark, Oldsmobile, Achieva, Pontiac
future? Grand Am, and some GMC and Chevrolet pickup
trucks. Motor magazine senior editor Tom Wilkin-
Innovation-What is the history of the client’s
son called this aspect of GM’s customer-is-king
technologies, and of your own? What are the
campaign ‘a win-win situation’.lh In pharmaceuti-
client’s current core technologies, technology
cals, Eli Lilly & Co. has adopted ‘Success through
practices, and potential new technologies? What
People’ as its sales philosophy, of which E. M.
can you draw from your own experience to
Cavalier, vice president of sales, said, ‘We take our
induce new client offers in the future?
responsibility to customers very seriously. Every
Everyday Production of Satisfaction-What stan- employee adheres to the company’s mission state-
dard practices are inherited or historical, and ment and vision, which decrees, among other
how do they connect with your own? What do things, that all company activities should be con-

Present Declarations and Practices for Coordination

Past as Received Future as Possibilities
Traditions and Discourses for Customers’ Identity
Constitution Standard Practices New Offers

Mission of What central concerns do What mission in What are the practices What emerging What practices can you bring
Customer customers inherit from the the world have for assessing end concerns are being from your own experience that
in World surrounding industry and customers declared7 changing customers’ addressed by the can transform the customem
Context culture? How do they connect strategic direction7 customers’ new identity in the marketplace7
with your own historical CffWS?

concerns?

Innovation What are the histories of critical What core What practices are in What innovations in What practices can you bring
technologies in your own and technologies have place for creating technology and/or from your own experience that
your customers’ industries7 customers declared new offers and for production will be can suggest new offers for
es the basis for their continuous needed to produce customem to make?
offerings? improvement? the new offers?

Everyday What standard practices have What are customers’ What are the standard What are the specific What practices can you bring
Production cuatomen inherited from existing business practices for new offers customers from your own experience that
of previous traditions7 Which do units and their areas production and arca pursuing7 can enhance the customen
Satisfaction you share? of responsibility? coordination in existing everyday coordination
customers’ companies? of action?

Training in What practices and assumptions What are customers’ What are the essential What new skills must What practices can you bring
Existing about education do the declarations about akills required by customers develop from your own experience to
internal customers hold, and which do employee training customers’ employse~? internally to wppcrt enhance competsnce and
Practices you share with them? and development? the new offers? learning in the cwtomers
ogsnization87

Copyright @ 1991, Business Design Associates, Inc. All rights reserved worldwide.

Figure 4. Listening to customers

102 Long Range Planning Vol. 26 June 1993

ducted with a thirst for excellence, with the highest the new world that is rapidly unfolding before us
ethical standards and with a customer orientation.“’ every day.
Another who listens when customers talk is folksy
‘ad wizard’ Leo Burnett, creator of such advertising
icons as Tony the Tiger, the Jolly Green Giant, the
Pillsbury Doughboy and the Marlboro Man. Bur-
nett’s Chicago-based advertising firm was flourish-
References
ing while Madison Avenue suffered recession.
Burnett said he concentrates on pleasing current (1) Vincent P. Barabba and Gerald Zaltman, Hearing the Voice of the
Market: Competitive Advantage through Creative Use of Market
clients (half have been with him for 20 years or information, Harvard Business School Press, MA (1991).
more) and avoids spending much time on going
(2) Ohno, Taiichi, Toyota Production System: Beyond Large-Scale
after new ones, as many firms do.” He depends upon Manufacturing, Productivity Press, Cambridge, Mass (1988).
his considerable credibility to get them. Industry
(3) George Lazarus, Facing U.S. heavyweights, NutraSweet looks
credibility, on the other hand, eluded IBM and abroad, Chicago Tribune, Business, 4, 2 July (1991); Nancy
Apple, whose technology-development agreement Ryan, Sweat equity: Fit Baby Boomers could fatten NutraSweet,
failed to convince sceptics that it would improve Chicago Tribune, 1, 11 September (1991).

quality and lower prices of computer software. (4) Nancy Ryan, McDonald’s, Turner Broadcasting cook up TV
Hugh Brownstone, manager of strategic planning at venture, Chicago Tribune, Business, 1, 19 November (1991).

Barclays Bank in New York, said, ‘While IBM, (5) Nancy Ryan. McDonald’s putting roasted chicken, pasta dishes
quite naturally, tries to regain control of the on the front burner, Chicago Tribune, Business, 1,25 September
(1991).
operating system (market) on one hand and chips on
the other, someone else could come along and build (6) Peter Kerr, Tempus fugit, but you can buy it, New York Times,
D-l, 10 October (1991).
an object-oriented voice operating system and that
would blow everybody out of the water’.” (7) Madonna Behen, New ideas have Swatch ticking again,
Women’s Wear Daily, 1, 30 August (1991); Bill Workman,
Veggie Swatch watches set off feeding frenzy, San Fancisco
Chronic/e, B-5, 12 September (1991).
Conclusion (8) Dean Takahashi, Toshiba develops disk drive of high capacity;
Computers: The firm has opened a factory in San Jose and will
Today’s global market, constantly changing in a hire up to 100 employees to produce the device, which can store
world that seems always in dizzying transition, can one gigabyte of data, LosAngeles Times, D-6,6 August (1991).
no longer be served with generically designed ‘Just-in-time’ methods help fuel IKEA growth; Success of
(9)
products and services. The time is past when it was furniture chain is based on more than marketing savvy. Chain
enough to gather statistical information on the Store Age (Executive Edition), 67 (7). 49, July (1991).

largest possible market and then serve it at the (IO) Martha T. Moore, Body Shop: ‘Profits with principles’; Owner
lowest feasible cost. Global trade is not driven by promotes corporate activism, Money, 8-B, 10 October (1991).

product or market today but by what will satisfy (11) John Humble and Gareth Jones, Creating a climate for
individual customers. This is not simply what innovation, Long Range Planning, 22 (4), 46-51 (1989).

people say they need. It is, above all, the concerns (12) Ken Partch. ‘Partnering’: a win-win proposition or the latest
they have about the future, and it behoves the hula hoop in marketing, Supermarket Business, 46 (5). 29, May
(1991).
successful provider to discover what they are.
(13) Picture Perfect, the Canon EOS, Electronic Engineering Times,
M-12, 30 September (1991).
A company’s offerings today must be individualized
to meet particular needs, situations and lifestyles. (14) See, for example, T. M. Pavia, Using marketing models in
strategic planning, Long Range Planning, 6 (1991); A. R.
Customers demand products and services of super- Andreason, Backward marketing research, Harvard Business
ior quality delivered with speed. The requirement is Review, May-June (1985); A. S. Lauglaug, Integrating cus-
for innovation flexibility, improvization and, tomers and innovation through technical-market research, Long
Range Planning, 2 (1993).
above all, anticipation and invention of new
opportunities in active collaboration with the (15) Dietger Hahn, Strategic management-tasks and challenges in
the 199Os, Long Range Planning, 24 (I), 26-39, February
customer. Responsive listening and execution will (1991).
depend on continual redesign of business processes,
(16) Adam Bryant, G.M. policy: New engines, not repairs, New York
cultivation of new skills, and a basic reorientation Times, 50,9 November (1991).
toward the customer and work.
(17) Kerry Rottenberger, Eli Lilly lauded for its bedside manner, Sa/es
& Marketing Management, 143 (1 1 ), 56, September (1991).
The organization that is listening, that organizes for
(18) Advertising: Leo the Gentle, Economist, 320 (7721), 58-59,
completion and satisfaction and that builds on 24 August (1991).
learning will gain a decisive competitive advantage
(19) Robert L. Scheier, Skeptical industry will need more results, less
into the next century. It will be a leader in observing rhetoric; The Apple, IBM alliance, PC Week, 6 (28). 14. 15 July
and adapting to the new ways of doing business in (1991).