by Philip Boxer BSc MBA PhD
So you say you want to put your clients first. By saying this, I assume you have decided that product/service excellence is not sufficient for you to survive.
In order to put your clients first, you are going to have to think not in terms of the survival of your enterprise, but in terms of the survival of the ecosystem of which you are a part, and of sustaining a place in it. Two things follow from this:
1. There are things to get clear about the way your enterprise currently operates:
- Your accountability hierarchy does not define your enterprise. What matters is the way the enterprise spans complexity on behalf of your clients in order to create value for them…(distinguishing novel emergence from hierarchy).
- Hierarchy may be the way you maintain sovereignty over your enterprise, but you will need to know how your hierarchy relates to the ways in which your enterprise exercises its spans of complexity…(defining sovereignty over task systems and sentient organisation).
- You will also need to know this about the other members of the ecosystem directly or indirectly supplying your clients…(stratifying relations of novel emergence subject to supply-side sovereignty: r-type and c-type propositions).
2. To get a better handle on what “putting clients first” means, you will then need:
- To understand the nature of your clients’ needs and what are the value deficits they are experiencing…(defining demand asymmetry: demand situations, effects ladders and P-type propositions).
- To think through what kinds of alignment are needed to address your clients’ situations one-by-one and how to sustain that alignment dynamically over time…(surrendering sovereignty through business platforms and K-type propositions).
- To lead your enterprise in a way that enables your people to identify not with what it does, but with what it can learn that will be valued by your clients…(on being edge-driven: outside is inside).
 For the competitive positioning of your enterprise not to be sufficient, in terms of its product/service excellence, you must be facing some kind of dynamic in the relationship that you must sustain with your client-customers. This means transitioning to a relational approach to competitive positioning (see value propositions at the edge).
 Whether or not being relational is in the interests of your enterprise is a question of the economics of one-sided versus multi-sided markets. When faced with multi-sided demands, the effect of using silo’d organisation, characteristic of positional competitive positioning, is that it results not only in the costs of alignment falling on the client-customer, but also in the costs to the sources of demand within the larger ecosystem being 30%-50% greater (see competing within ecosystems).
Why? Because while the client-customer is getting a worse service (that they have to compensate for themselves as best they can), the supplying organisations get paid too much for a one-sided approach, the additional expenditures going to the suppliers at the expense of the client-customer. In the private sector this can be left at the door of ‘market failure’ i.e. the suppliers don’t want things to change because it will work against their interests. In the public sector, however, this means that the citizen pays twice – indirectly in taxes to pay for one-sided suppliers, and directly through having to pay too much for inadequate services and/or paying for the gap personally if they can afford to.
The key issue here is this form of ‘market failure’ aka an inability to sustain a relational form of organisation. Hence the question: do you really want to put your customers first?