Harder Than It Looks

A few days ago I saw an article on the AOL Money site that was talking about how some CEOs never seem to get out into the field and look at the conditions their customers encounter, whether it's retail people who never tour their own stores, consumer goods manufacturers who never tour the retail outlets that carry their goods, the CEO of Ford Motor Company who never goes out to the dealerships, and so on. All of these people were being portrayed as lazy, or at least out of touch with their customers, and the author was insinuating that this accounted for the poor performance of their companies. To nail down the point, the author also mentioned a handful of CEOs who do make a point of connecting with their customers at the retail level (including the legendary Sam Walton), implying that this is the explanation for their firms doing so well.

It's an appealing idea, isn't it? If all it takes for a firm to succeed in an increasingly competitive marketplace is to have the guy at the top get in the limo and go visit all of stores, then anybody can be a top CEO! Every company can be the best there is, and if they fail, it's only because those overpaid yahoos in senior management are too lazy to get out there and connect with their customers! All we need is good old-fashioned Yankee work ethic! None of this professional training in business and management, decades of real-world experience, painstaking analysis and evaluation; just give any old goober a plane ticket and a rental car, and you too can rule the world!

Alas, if only it were so...

The fact is, this is the same sort of lazy, anti-intellectual garbage that brought you the dot-com crash, wheat and corn prices that have tripled in the past six months, and "mission statements" that are four pages long. Yes, it's important for the leadership of a company to understand the market forces that drive their customers, including conditions in the stores that sell their product. But it isn't necessary for the CEO to actually go anywhere, provide the flow of information up from the field operations units is good enough to provide that perspective. It was a great PR gesture to have customers walk into a Wal-Mart and shake hands with Sam, one of the richest men in the world at the time, and the value of having him talk with his line personnel and LISTEN to their concerns while he was there is well established. But if I'm one of the stockholders, I'd rather have the CEO of Ford sit down with a focus group of customers who have stopped buying Ford vehicles and ask what he (and his officers) can do to get those customers back than have him swanning around a dealership shaking hands...

The fact is, even if you know exactly what your customers want to purchase this minute, that may not help you design, build and fill the inventory with what they are going to want to purchase in a year -- and if it takes you three years to bring a product to market then knowing what people want to purchase right now may not help. The issues that drive consumers away in California might be the same factors that draw them in droves in Michigan; business concepts that work in April may be total failures in December; trends driven by movies or television shows (or their cast members) may fade away when the programs do. Running a company is an enormously complex task, and even some very capable, highly intelligent, incredibly hard working people will ultimately fail at it, some for reasons completely beyond their control.

As the old saying goes, "It's harder than it looks..."