Principles of Good Product Development

Listening to the Voice of the Customer

In the last few years some companies have come to understand that they only exist because their customers buy their services or products. At the other extreme, there are many more companies who have an almost Soviet planning approach to product development. They still produce a product or service according to the command of their internal planning committees and expect people to buy it.

Until 10 or 15 years ago this method worked - even in the industrialized West. Demand was so high and unquestioning that most companies providing products and services didn't think seriously of listening to customer opinion. Instead they defined their corporate markets and plan, their engineers defined their product, and their plants then went ahead and produced products to plan. Customers were not involved in the process. It was assumed they would be grateful for the products produced for them.

Things have changed a lot in recent years, thanks to Japanese manufacturers and increased competition. However, there are still quite a lot of Western manufacturers and service companies who haven't caught on. Often the problem is that they are run by people who spent much of their career in the 'age of production' when the customer's opinion was not sought. Some airlines still treat their passengers as if the airline was doing passengers a favor by letting them fly on their dirty old planes with unfriendly crews. These airlines still haven't understood that passengers have, or will have, a choice - flying with a competitor. Where there is already a competitor on the route, maybe the competitor will have cut overhead costs, smartened up its planes and sent its crews on training courses to learn how to behave with customers - people who have paid good money to buy the airline's service. In other cases, there may not be a competitor yet - but the opportunity (and the threat) is there.

For many years, similar problems bedeviled the Western automobile manufacturers. They couldn't understand that, given a choice, many people would rather buy a nicely-styled, up-to-date, inexpensive, reliable, cheap-to-run car from Japan than an expensive-to-buy, expensive-to-run, likely-to-breakdown dinosaur from Detroit. At last it looks as if most of them are beginning to get the message - but you have to wonder why it has taken so long.

You might think that what happens to airlines and giant automotive manufacturers isn't relevant to your product development process - but it is. It is important to listen to the customer, to take account of what the customer is saying about your product or service, to take account of what a potential customer is saying about your competitors' products and services. If you show some interest in your potential customer's needs and wishes when you develop your product or service, then when that person comes to spend hard-earned money, they may buy your product or service rather than that of your competitor.

It's important that many customers do choose your product rather than your competitor's. The end result of having enough customers buy your product is that at the end of the financial year your company's revenues exceed its costs. If this isn't the case, then before long you may find yourself 'surplussed'. You might think this is unlikely to happen, but look around. There are quite a few companies that forgot the simple habit of listening to the customer. They can be found in almost every industry - steel, automobile, computer, consumer electronics, airline - and, as international competition and deregulation spread, other industries such as telecommunications and utilities will be affected.

It's important for you and your company to listen to the customer, and make sure that the customer's demands, expectations, requirements and wishes are reflected in the product you offer. Listening to the customer is a key part of the product development process. The customer provides a lot, if not most, of the product specification. Of course, in some cases, a new product is invented and so the specifications come from the mind of the inventor or researcher. In most cases though, a customer isn't going to buy an invention - a customer buys a product or service that incorporates the invention. If the product or service doesn't meet customer requirements then the invention - however brilliant - falls by the wayside. The same is true for the brilliant ideas that engineers like to add on to a product - unless the customer wants them then they are more likely to do harm than good.

How can product development organizations listen to customers and find out what they want? Strangely enough one way is actually by sitting down and talking with customers. Another - even stranger for those product development organizations that try to keep away from customers - is to involve customer representatives in the development process. In both these cases, the contact is direct. It's not via a sales rep who talks to someone from Marketing in a bar one evening - who then tells the Marketing VP at the next monthly meeting - who mentions it to the Engineering VP - who suggests someone works on it when they have some time.

The advantage of close relationships with the customer is that they help ensure that the product being developed really meets customer requirements. Most of the time, such relationships also prevent errors occurring. Now and again, some errors may occur, but they will be seen and corrected before they can cause too much trouble. These relationships save time because people only work on what is required to add value, rather than on non-value-adding activities. Similarly, money is saved by cutting out unnecessary activities and eliminating changes and rework.

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Page last modified on March 10, 2000
Copyright 2000 by John Stark