Back in the 1990s, my employer, a now-bankrupt architectural firm, put on an in-house seminar featuring a very animated fellow from the Tom Peters Group. Peters and Robert Waterman, Jr co-authored In Search of Excellence (1982), a hugely popular business book. I had heard more about Tom Peters solo 1987 book, Thriving on Chaos, which I started to read, and still have in my basement.
The message was fairly simple: Know who your clients are, and make them happy … deliriously happy. Provide legendary service. He noted that your clients may be within your own company. Our irascible handyman and blueprint guy asked, “What if you have too many clients?” and everyone laughed. “What a problem to have!” was the reply.
At one point in the seminar he pointed out that our project managers, as our closest connection to our clients, should have been the second most influential group in the firm, right below the partners. Instead, the department heads of Design, Production, Field Supervision, and Office Services were much more influential than the PMs.
What I have taken away from what the guy from Peters told us was that we had to get good customers and satisfy them because there was no way to keep the sort of customer that only cares about low price. You can, he said, save a fortune on marketing and advertising by keeping those customers that value good service. But if you fail them, they will leave and will probably never tell you why.
I dimly remember a tv commercial where some guy on a podium tells a convention crowd, “the buzzword this year … is quality.” And everyone started dutifully chanting, “quality, quality, quality …” We instituted “round table” discussions to improve communication between departments, but ultimately very little changed. The firm I’m with now doesn’t have departments.
Anyway, Cenk Uygur interviewed Nick Hanauer on The Young Turks on Tuesday, and it is now on youtube:
Besides being a successful entrepreneur and businessman, Hanauer is known for his article, The Pitchforks are Coming … for Us Plutocrats, in Politico in 2014.
Seeing where things are headed is the essence of entrepreneurship. And what do I see in our future now?
I see pitchforks.
If we don’t do something to fix the glaring inequities in this economy, the pitchforks are going to come for us. No society can sustain this kind of rising inequality. In fact, there is no example in human history where wealth accumulated like this and the pitchforks didn’t eventually come out. You show me a highly unequal society, and I will show you a police state. Or an uprising. There are no counterexamples. None. It’s not if, it’s when.
Hanuaer told Uygur that many in his peer group were initially angry and defensive about his article, but claims that most of the rich folk he knows now acknowledge the problems of income equality, but don’t know what to do about it. Human nature is to try and spend or pay as little as possible, and the tenets of trickle-down economics have provided a comforting refuge for employers to do just that.
So it seems that employers have gone in big for low prices, and have gotten something like the situation that Tom Peters predicted. While they pay low wages (and even no wages to interns) corporations and businesses still advertise like crazy – fighting over the shrinking share of customers with disposable incomes. Customers with little or no money can’t afford loyalty to any brand, and our economy enters the death spiral that Hanauer discusses.
This is a part of the false reality that Andrew Bacevich mentioned (see my previous post). America has been a booming growth economy for so long, that entrepreneurs still believe that the sucker born every minute will have enough money for their snake oil.