Newspaper article THE JOURNAL RECORD

New Meaning of Service: Let Customer Be One in Charge

Newspaper article THE JOURNAL RECORD

New Meaning of Service: Let Customer Be One in Charge

Article excerpt

Service is the hottest topic in management circles these days. Many, myself included, see ``service-added'' as the chief competitive battleground in the coming years. Service books are popping out all over. Service articles dot business magazines - the current Harvard Business Review alone has a half dozen.

Amid this barrage, an article by Dave Ulrich in the Summer 1989 Sloan Management Review stands apart. In ``Tie the Corporate Knot: Gaining Complete Customer Commitment,'' the University of Michigan professor urges turning the organization inside out. The premise: ``Satisfied customers remain independent from the firm; committed customers become interdependent with the firm through shared resources and values.''

The chief lever for moving from mere customer satisfaction to more encompassing customer commitment, says Ulrich, is the most internally oriented and intimate of management processes - human resource practices. He enumerates six traditionally sacrosanct areas that can be recast to induce lasting customer engagement with the firm.

Area One: Appointments and promotions. Ulrich cites an office products company that has its customers offer criteria for selecting account representative candidates. Subsequently, those customers review the finalists' curricula vitae. Having been involved in the decision from start to finish, the customer has a higher stake in making the rep (and thence the company) successful, Ulrich contends. At General Electric, another company Ulrich examined, human resource people routinely solicit and use customer feedback in promotion decisions and succession planning.

Area Two: Performance appraisal. At a Digital Equipment Corp. plant in Enfield, Mass., Ulrich found that customers virtually determined line worker and manager performance appraisal criteria - they even helped design the appraisal forms! Customers later provide much of the information that goes into the appraisal.

Area Three: Training and development. Ulrich provides numerous examples of firms that have customers directly involved in sales, service and technical training programs; for instance, Sears execs routinely make presentations in training programs for appliance-maker Whirlpool. Ulrich found customers engaged in course design as well. In several situations, he observed trainers visiting customers to perform a ``needs analysis,'' which helps them determine the overall training curriculum.

On a related tack, Ulrich tells of one major computer company that invites the CEOs of its best six customers to participate for three days (out of five) in its annual top management strategy-shaping retreat.

Area Four: Customer-commitment incentives. …

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