E-NEWSLETTER | OCTOBER 2007
Feature Article:

Building Customer Focused Organizations - A Consultant's Secret

-- By Greg Baker, President and CEO, Advance Consulting

Last month we talked about the nature of customer focused organizations.  But how do you know if you have one?  How do you build one?  This month I want to share a consultant’s secret for understanding and building customer focused organizations. 

When I was a younger consultant, a wise and experienced consultant passed on to me an extremely valuable “secret” that I will now pass on to you.  He said:

“If you want to understand how an organization works, follow the money.  If you want to understand how an organization is “broken”, find the places within it where responsibility and control are out of alignment.”

This was a lot for me to take in all at once, but as the years of my career progressed, my experience proved this to be an extremely valuable truth.  I will attempt to explain the essence of this truth in this short newsletter - and leave you with a valuable tool.

Follow the money to see how the organization works.  In an organization, money is energy.  Things happen in an organization when money is provided to fuel the activity.  To a large extent, the power of any organizational component (e.g., department, project, person) is determined by how money flows to it and from it.  In general, the provider of money (the buyer) has some control over the receiving entity (the provider).  So when we “follow the money”, we discover the organization’s collective funding sources, the activities they fuel, and their overall influence.  In doing so, we “understand how it works.”

“How it works” it is often different than “how it should work.”  This is what we mean by “broken” – where responsibility and control are out of alignment.  Whatever your organizational structure, it can be reinforced or undermined by the flow of money.

A classic example of misalignment:  Many of our clients are facing the need to improve their performance on cross-functional team-based projects.  This usually implies the need to move toward a matrix organization.  Many move in that direction without changing the flow of money.  They want to hold projects and Project Managers accountable for “executing” on projects, but they do not change the flow of money to align with that accountability.

In this example, the functional departments continue to receive, directly from the budgeting process, funds associated with project execution.  In other words, the project budget does not include the funds to pay for all of the people on the project.  The people are still paid by their departments or business units, and they know that.  People supporting the projects don’t view the Project Manager as someone they “report” to or take direction from.  Thus, Project Managers must “beg” for and borrow people to serve on their projects who may be reluctant to take direction from them, only to deal with the blows associated with departments that decide one day there is something better to do with their resources.

This is a classic misalignment of control and responsibility.  The department has the control – via the flow of money and the established reporting relationship – yet the Project Manager has the responsibility for successfully executing the project.

Under these circumstances the organization can either unfairly hold the Project Manager accountable for the project or it can recognize the control issue and let him off the hook.  But then who is accountable for the project?

Conversely, in this example we are we giving departments money but not holding them accountable for producing anything of value to the organization.  The departments are not bad; they are just following the rules of the organization, fueled by the flow of money!  Reporting responsibilities and the flow of money would need to be altered to correct this misalignment.

The punch line:

Multiply this problem by everywhere in the organization where there is misalignment of control and responsibility, and you will understand the organizational dysfunction that prevents it from being customer focused! 

To correct this, simply apply this test of alignment to every job, person, and function in the organization, and take whatever steps are necessary to build alignment.  No organization is perfect, but if you use alignment of control and responsibility as your compass, you can build a customer-focused organization that eliminates obstacles and supports the people in delivering customer-focused products and solutions.  Now you know the “secret.”

At Advance Consulting we have helped many organizations in their pursuit to become customer focused.  We can help you develop and implement your customer focused operation.  For more information on how we can assist you, please contact us at (831) 372-9444 or email us at advanceinfo@advanceconsulting.com.


Skills Corner - How to Quickly and Effectively Resolve Conflict

Conflict is a subject that can make our stomachs churn and our palms sweat.  It is an area that some of us would like to avoid.  However, conflicts that are not resolved can have a major impact on your company and employees.  Conflicts can affect employee morale, productivity and client retention.  To maintain your competitive advantage, you need the entire company to focus on developing strategies to quickly and effectively resolve conflict while building trust and commitment with clients and colleagues.

When presented with a challenging conflict situation keep these tips in mind:

  1. Recognize your own and other's responses to conflict.
  2. Determine a strategy for how to adjust your own conflict styles in a conflict situation.
  3. Question thoroughly and listen.
  4. When in conflict over one issue, expand the conversation to include other pertinent issues.
  5. Evaluate ideas against client needs and project goals.
  6. Analyze the root causes of a conflict.
  7. Focus on eliminating the emotional aspect of a conflict before resolving the issue.



What’s New at Advance Consulting?

The Consultative Approach Public Workshop
 Public Workshop

Are you looking for an opportunity to experience ?  Are there others in your organization who have not had a chance to attend the workshop yet?

This is your chance to attend Workshop in October 22-23 in San Mateo, CA.  Through this highly interactive workshop, participants will learn how to enhance their value in today’s business environment by:

  • Working more strategically with customers and team members.
  • Communicating expertise to gain influence.
  • Using questioning and listening skills to understand customer issues and identify root causes.
  • Developing solution ideas responsive to business issues and customer needs.
  • Using a proactive four-phased consulting process to gain agreement on project scope and ensure customer commitment throughout the project.

Please visit http://www.advanceconsulting.com/Pages/workshop-flier.html or call (510) 888-1914 to register.  Don’t forget to ask about our registration discounts.  We hope to see you there!

About Us

Advance Consulting Inc., a premier management consulting and professional development firm, serves corporate and government clients in the U.S. and abroad.  Established in 1990, Advance Consulting specializes in the transformation of people, teams, and organizations as they aspire to create their “Enterprises of the Future” with the ability to adapt and thrive in the turbulent and challenging global business environment.  We work with our clients to build aligned consultative cultures by addressing the organizational, operational, and individual issues that are integral to an organization’s success in achieving desired business results.

Give Us Your Feedback

We’d appreciate hearing your thoughts and suggestions on how we can shape our newsletter to better meet your needs.  Let us know what topics you’d like to see covered.   Please contact us at advanceinfo@advanceconsulting.com, or call us at (831) 372-9444.