Elements of Customer-Driven Organizations

The proper place of the customer in the organization s hierarchy is illustrated in Figure 3.1.

Figure 3.1. The correct view of the company organization chart.

From Marketing Management: Analysis, Planning, Implementation, and Control, Figure 1-7, p. 21, by Philip Kotler, copyright 1991 by Prentice-Hall, Inc. Reprinted by permission.

Note that this perspective is precisely the opposite of the traditional view of the organization. The difficulties involved in making such a radical change should not be underestimated. Problems exist even within the quality community itself. For example, the original Malcolm Baldrige National Quality Award criteria allocated 30% of the total points to customer satisfaction, the highest of any criteria. However, in recent years the point allocation was lowered to 25%, equal to the business results category. It seems that the customer s position atop the organization may be threatened.

The importance of the quality activity within the organization has been evolving along with that of the importance of the customer. Figure 3.2 illustrates the evolution of the quality function s role since the mid-1970s.

Figure 3.2. Evolving views of quality s role in the company.

Adapted from Marketing Management: Analysis, Planning, Implementation, and Control, Figure 1-8, p. 24, by Philip Kotler, copyright 1991 by Prentice-Hall, Inc. Reprinted by permission.

Marketing has traditionally claimed jurisdiction over activities directed at acquiring and retaining customers. The roles of the quality function and marketing function are overlapping and complementary. Recent research provides evidence that quality is a primary driver in...