Who is the Client? The Hypocrisy!

Clients are those entitiesfor whom an organization exists to satisfy their needs.

Who are those clients?

According to the Chicagoschool of economics, led by the Milton Friedman thesis and followed largely byeconomists worldwide, a business organization exists to make profits for itsowners.

If so, the clients forwhich the business enterprise exists are the investors with a need for a ReturnOn their Investment.

But what happens whenthe focus is on profits for the owners and the customers in the marketplace arethe means to satisfy investors?  Whenthis goal displacement takes place what happens?

Does anyone trulybelieve that the customers, the clients in the marketplace, really need foodlaced with chemicals to make it last longer on the shelf? Or fast food thatmakes the consumers obese and thereafter sick with diabetes and other diseases?

Customers, to theirdetriment, are often not served what they truly need but what will make profitsfor the owners. It is not a market-driven economy. It is a financial marketdriven economy.

And what else suffers? The water that gets polluted, the air that gets unbreathable, the rivers that are un-swim-able , the society that is burdened by unemployed people who cannot join the circle of work, technology wade them replaceable and retraining is expensive and left for the  taxpayers to finance that.

Who sits on the Board ofDirectors that directs all strategic decisions of the company? Do you see anyrepresentative of the customers? Of the community, or of the environment? It isonly the representatives of the owners. So, who is working for whom really?

What should it be?

The customers should bethe clients, the purpose for which the organization exists.  The owners, investors should be only the stakeholders to be satisfied only enough to stay engaged. Not more.  Profits should be constraint goals, goals notto be violated, not deterministic goals to be sought and the more the better.

            Thatwas the case, I suggest, when craftsman dominated the market. There was pridein the product produced and loyalty to and from the customer. Today customersare a statistic. 

What dominates and directsexecutive decision making is the stock market, if one is a public company andif not, the business culture fed in business schools to produce profits as muchas possible. Management has to “dance to the tune of the stock market” and itsexpectations to perform better than expected. Earnings per share are the goal. Evenwell-meaning executives have no choice but to “dance”; if they miss expected earningsper share of their company they might be replaced.

So, who is driving the system? Isuggest not the people, but the system is driving itself and we all dance toits tune. All this talk that the customer is the king is talk. The earnings pershare is the king, the emperor and the tsar.  

Just thinking,

Ichak Kalderon Adizes

Written by
Dr. Ichak Adizes