Listen to the customer

General Motors, the world’s largest company, has fallen on hard times. Its bonds are rated junk by many bond raters and it has had to trim employees and costs to avoid what many think inevitable—bankruptcy. So why all the problems? There are the standard answers, the one GM gives: too high healthcare and retirements costs; not the right kind of incentives for buyers; problems with suppliers; etc. But the real problem is that people aren’t buying their cars.

A few years back I read an interview with Waggoner, the current head of GM. In it he said that everything could be measured—everything. He depended on that “fact” to propel GM to new heights. His argument boiled down to: Everything can be measured and that measurement would allow him and his managers to set a company direction toward greater profitability.

Measurement depends on numbers. Numbers are the basic units of measurement—the “quanta” of measurements. They are the metrics. If you want to find out what is really going on in business, according to this view, get the numbers. If there are no numbers on it, then you must get numbers on it. If it is not possible to get numbers on it, what are you left with? it isn’t important? it doesn’t exist? not worth your time? it’s not a “thing”? or what?

In GM’s case, they came up with the numbers and those numbers told them something. That “something” was used to figure out their products and product mix. But when that met up with the consumer, the consumer didn’t buy. Something is wrong here.

GM would say that they got the measurement wrong. I think they got the measurement right but bypassed what the consumer was telling them to get to the numbers. The customers didn’t really know—the numbers did. The numbers knew better.

But they didn’t know better.

Listen to what the customer is telling you. If you don’t have a way to listen, find a way to do it. It is that information, what the customer is actually telling you, that is crucial for your business.