The Customer is more complex than you think

Universal model of supply chain

I put up this diagram of a universal supply chain model for WPI members.  My idea is to display the supply chain as it currently appears in such a way that is represents what is going on in most businesses.  This supply chain could be a Business to Business (B2B) or a Business to Customer (B2C) supply chain.  My aim is to be both simple and inclusive of every possible combination so please feel free to suggest improvements to the model if you think there are errors or omissions.

This post could also be entitled "The Customer is not Always The Customer!".  The customer regardless of whether they are a retail customer or a business customer is usually not just one person.  In a business context the purchaser is often not the end user and the purchaser may or may not be the decision maker.  Centralised purchasing and procurement often means that the end user can be left out of the decision entirely and must fight for the right to influence the buying decision.

We often think of retail purchases as being personal decisions but they are just as complex as any business buying scenario.  We often buy things for other people, not just gifts but food and other supermarket items are shared within homes, families and friends.  Parents buy almost everything for their children and yet the children usually influence the decision.

The other people that affect the buying or choices of the end user, I have called the influencers.  These are people who may have no real stake in the decision but still make an impact on the end user or buyer.  These people are everyone from the boss and your peers at work, corporate policy makers, friends and of course the reviewers that are now everywhere on the internet.  These will include past customers and people who simply have an opinion about you based on varying levels of experience and expertise.

Of course your marketing and PR have an impact here, but it is your products and services and the way they are delivered that will have the most impact.  Many of the interactions that are occurring in the yellow shaded box above will be out of your direct control.  The only way to really impact these interactions is to make sure that the point of direct connection between your product and service creates the right experience to keep people coming back and becoming a positive influencer on a future transaction.

The customer is the pre-eminent person in the supply chain.  All of the upstream activities simply do not occur without customers.  Assuming you have a product that is in demand the next biggest contributor to your success will be the quality and competence of your supply chain and its ability to reach the customer wherever they may be and deliver your product with the right experience.

Why not map your own supply chain and identify the customers, end users and influencers within your customer?  Then ask yourself (or better still go and find out) how well your supply chain is delivering both the product and the experience?

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