Archive for December, 2010

The customer is always right.

A recent Harvard Business School post (Create a Simple Strategic Principle – Management Tip of the Day – September 23, 2010 – Harvard Business Review.) is about strategic principles.  Having a strategic principle against which employees can test their decisions helps companies stay focused on the most important business.  The customer is always right is one such principle.   

We know that the customer is not always right.  There are customers who play games, who get close to or cross over the ethical line, or who aren’t profitable. These are the customers we don’t want.  It is management’s job to avoid acquiring or get rid of these customers…what the accounting firms call “selectivity.” 

When management establishes and diligently oversees policies to screen out undesirable customers, they can confidently ask employees  to make decisions based on the principle that the customer is always right.  That’s a recipe for business success.