“It is not the employer who pays the wages. Employers only handle the money. It is the customer who pays the wages.” – Henry Ford.
Hmm! Well in a way, I agree with this statement, as long as it gets everyone focused on the fact that without customers, you’re not in business and don’t have a job! So I get it, at least in that respect. But is also a statement that is often misinterpreted.
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When I was working for Coca-Cola on the McDonald’s business, I had a colleague who similarly said to me that Coca-Cola did not pay his salary. So I asked him “Who do you think pays your wages?” He said McDonald’s did.
I took issue with this remark and asked him what company name was written on his business card? He responded it was our company. I then asked him who paid his expenses. He responded again with our company. I then asked who purchased his company car and paid for its maintenance, insurance and the fuel. He again responded it was our company. However, his view was that, although our company did pay for these things, it was only due to the business that our customer-generated, that allowed Coca-Cola to remunerate him.
It’s a fair argument but here’s what worries me about it. It can be a slippery slope. People who think that way, often get confused with loyalties.
Let me explain. The same person I was talking about provided second-to-none customer service. He drove our bottlers to provide second-to-none service, generated service calls for any small request, would travel at the drop of a hat if asked and provide free product at any of the customer meetings. He was fully committed to his customer.
The customer loved him. In numerous meetings I was at, he argued to provide the customer things, such as lower prices, that were against company policy. I learnt a lot from him.
In my view, he had lost sight of the balance between what is added value vs. getting screwed! A lot of what he was doing to deliver incremental added value was costing our company a huge amount of money. At a certain point, you have to make a stand and communicate to the customer what balance is! An unprofitable supplier is no good to the customer.
If the supplier goes out of business, then it is a zero sum game. LOSE-LOSE! Especially if it is a supplier that has worked on the business a long time and knows the customers business really well and is already adding high value on a consistent basis.
For the customer such a relationship is difficult to replace and will contain huge hidden costs, even if the vending price may be lower!
We all want to provide the best, to be seen as the hero and be known as the ultimate go-to customer guy! BUT, we need balance. We need to understand that we can only do this when it makes financial and operational sense to our own company.
So, by all means, understand that the customer pays for your remuneration indirectly; but also understand that there has to be a balance.
If your company no longer makes a profit, no one will be paying your wages. You will indeed be out of a job – customer or no customer!
Peter M. Beaumont is the Founder and Owner of ConnXN and is a customer relationship mentor who helps those responsible for their stellar clients follow a unique 6-step process, which identifies, builds and maintains their key contacts so they can protect and grow their business.
