As I reach out and introduce people to the IMPROVE! Process Improvement Expertise brand, I am constantly reminded of how other people and their businesses often misunderstand the symbiotic relationship of customers and suppliers and the critical role it plays in their own success. When I ask what a person or business does, I often get an explanation of a product or service they offer, but rarely do I hear what that product or service does for the people who purchase it; their customers. I also rarely hear anything about how well they are meeting the needs of their customer.

To explain it most plainly, you first need to understand three things:

  1. A CUSTOMER defines and seeks values that they desire.
  2. A SUPPLIER serves the customer by delivering the values that the customer seeks.
  3. The gap between values that the customer desires and values that the supplier delivers is the measure of CUSTOMER SATISFACTION.

These three things are true in everything we do in life.  It is true when we go to the grocery store. It is true when we participate on a multifunctional team in the office. It is true when we go home at night and spend time with our friends and family.

I realize reducing the world to such a transactional model is an over-simplification because the reasoning behind the customer’s choices can be very complex, However, it has been my experience and observation that if one applies a Pareto 80/20 rule to customer reasoning, each of the values identified in the top 20% can be understood and quantified so that the supplier has a much higher chance of meeting the customer’s expectation and thus reaching a higher level of customer satisfaction. Happier grocery shoppers, happier teammates, happier family; it sounds like something worth pursuing.

If you now look back at those three things in my list, you will see a common word in each sentence (Hint, it’s not “that” ? ). It’s the word “values”. Values are the set of unique wants and needs that each customer decides they want to receive in a supplier transaction. How can we better define each value in the set?

For me, I like to use the following definition:

VALUE=

 the LEAST COST (units can be time, money, physical effort etc.)

  • for an essential FUNCTION, SERVICE or THING
  • provided at the desired TIME and PLACE
  • with the required QUALITY and RELIABILITY that the customer is expecting

Every customer in their own minds defines value in a given situation by these guidelines. Said in another way dating back to antiquity but expressed in modern language by Margaret Wolfe Hungerford in 1878, “Beauty is in the mind of the beholder”.

So as suppliers endeavoring to provide our customers with the thing(s) they want, we are constantly challenged to ferret out what those values are that they seek. Some call this market research. Some consider the value to be obvious (Why else do you call a plumber but for a plumbing problem!). Some entrepreneurs believe only in their vision knowing that there must be a market for that better whatever it is they created because they wanted it. Sadly, that is why so many entrepreneurs fail.

It is now time to explain what I meant by there being a symbiotic relationship between customers and suppliers. In our need as suppliers to satisfy customers we in fact transition into the roll of customer ourselves.

We are all CUSTOMERS…. We are all SUPPLIERS

We are the customer of our customer in asking them what it is they want. We also are the customer to our suppliers who must provide us with materials or other things we need in order to create the value for our customers.

That means we had better understand what our customer wants so that we can communicate it downstream to our suppliers otherwise we are introducing inefficiency and waste in our process. It’s a big symbiotic circle of listening and communicating so everyone along the way receives the values they seek.  As we continue around that circle of the Customer – Supplier relationship we have the opportunity to make refinements to our knowledge base about our customers which informs us as to process improvements we can apply to narrow the value gap and improve customer satisfaction. That’s how we succeed.

Some talk of “customer delight” as exceeding the expectations of a customer in a way that makes them so happy they come back as return customers and spread positive reactions to other potential customers. I would posit that what is really going on is that by more completely understanding the values that the customers are seeking by iterative process improvement, we are able to narrow the customer satisfaction gap to such a level that the customer has never experienced previously. This is the source of delight.

If you’d like to learn more about how to use principles of continuous improvement to improve your processes and better satisfy your customers, drop me a line through one of my “Contact Us” forms on the site.

Until the next time, have a great day.

Article by Chris Redgrave

Chief Improvement Officer (and owner) of IMPROVE!