The Customer or Profits: Where to Focus?

  CRM   Stakeholder Management  

I recently received an e-mail from eCustomerServiceWorld.com that contained a quote from Harvard Professor Michael Porter, who was introduced as the world’s leading strategy guru. According to the article, the professor says, “Customers have to be at the center of business. But, that does not mean they are everything. So many managers say, ‘Customers are everything.’ That is a dangerous perspective.”

Talking to eCustomerServiceWorld’s Phil Dourado, Porter says, “Serving the customer is not good for its own sake. Your Customer Management goal must be ‘Serving the customer AND making a profit.’”

Well, it is hard to argue against that logic, and I hate the idea of even remotely refuting something that a Harvard professor believes to be fact. Nevertheless, while I understand what the professor is saying, I am not in complete agreement with him.

In my humble opinion, if your corporate strategy tries to focus on too many areas at once, nothing is likely to be accomplished. This idea is backed up in Fred Wiersema’s 1996 book Customer Intimacy. The author points out that a company can become a market leader through excellence only in one of three operational areas: innovation (i.e., Sony Corporation), operational efficiency (i.e., Wal-Mart) and customer intimacy (i.e., …

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