One of the key themes of Stephen Shapiro’s excellent book, 24/7 Innovation, is customer-focused innovation. In it, he explains how customers — who now have an unprecedented number of choices and unparalleled access to product information prior to the sale — now control the buying process. To be successful, organizations must “hire” their key customers, and make them an integral part of their new product development and business redesign efforts.
“Regardless of what they say, many companies are, organizationally speaking, still focused on products, not on the customer or the marketplace. Production departments count and record the number of goods that are produced, in what color, and at what price. With these goods roll off the line, they are like orphans waiting to be adopted. It’s up to somebody else — a separate department with different aims — to get them moving out of the warehouse, to persuade some consumers somewhere to take them in — and at a good price.
Organizations in which the production mentality dominates don’t concern themselves much with who buys their goods… and, more importantly, they don’t concern themselves with why they buy the goods — how will my products help them live their lives or run their businesses more successfully? Because of this, they fail to find the answer to a key question: ‘What else can I provide my customers that goes beyond what they are getting today?’ These companies often make the mistake of hunting down new customers for each of their products or services as they become available. Obviously, it costs several times as much to find a new customer as it does to sell to an existing one.”
Shapiro adds that a customer-centric strategy demands that you think about customers’ unmet needs, and about products and services they may not even realize that they need yet. He also encourages readers to redesign their business processes with the customer at the center, and to involve customers in your innovations as a way to help differentiate your products and services from those of your competitors. “This leads to new products, new services, and new ways of delivering those products and services,” he adds.