Consumer Sovereignty


Mainstream economics uses some simple starting points; it believes that they are the best possible. First is that agents have more wants than they can attain, so that they feel scarcity; in fact, for practical purposes, wants are assumed to be endless. Second, third and fourth are that agents are self-interested, rational, and the best judges of their own well-being. These four assumptions are indeed usually good starting points, rather than starting by assuming that agents are completely fulfilled, altruistic, irrational, and not well-placed to evaluate their own situation. They are not equally good as finishing points. Sometimes good arguments exist for not accepting them.

An assumption that agents are the best judges of their own well being is less questionable for businesspeople and corporations, given the resources they have for analysis. Debate focuses more on consumers. The phrase consumer sovereignty is sometimes read descriptively, to mean that consumers are sovereign, in that procedures are induced via profit-seeking and competition  to provide what consumers want. Sometimes it is read normatively, to mean that consumers should be sovereign, their wishes should prevail concerning what is good for them. The normative claim can rest on three different bases: that consumers do make good choices; that the alternative stance is worse – to use someone else’s judgments and estimates of what is good for a person and how good it is; or quite differently, that people have the right to make their own choices and mistakes.

Consumers will not make good choices automatically and unconditionally. Our wants are not simple; for example, some are wants to not to have other wants (such as the desire to smoke or a compulsion to gamble). Establishing a mature balance between wants involves skills. Choice is also unlikely to bring satisfaction if taken on the basis of weak information. Markets often do not provide consumers with full and reliable information, for it is hard to exclude people from information and therefore to ensure payment for it, so its market supply is weakened. Instead, in a commerce-dominated society, one of the main types of information that adults get will be images that say the good life is obtained through high consumption of commodities; there is too little counteracting public information.

The issue of consumer sovereignty goes beyond whether choices are good for the chooser. Other people are affected. Some wants may thus be unacceptable, notably wants that bring harm to others, including even wants to harm others. Mainstream economists have unfortunately often taken a don’t-want-to-know approach to ethics in which they confuse acceptance of all wants with a value-neutral stance.

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

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The Vicious Circle


Revenge tends to metastatize inside a company, organization, or family. Stepping on someone else rarely if ever occurs in a vacuum: it’s just one part of a potentially endless cycle. Even indirect retaliation leads to a vicious spiral. Repressed revenge can spread just as far and have even longer-lasting impact.

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

Customer Commitment


Great companies are extremely market-oriented and are incredible at creating value to their highly satisfied, loyal customers. Greatness in marketing and customer service is a function of attitude, not resources. Most companies do not do a very good job as marketers. Consider when you have been put on hold endlessly when calling for technical support, when you have been ignored or treated indifferently when visiting a retail site, or when you have been supplied inferior goods or services. While second-rate firms may survive in the short term, they will not last in the long run unless they change their philosophy and start creating superior value for their customers.

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

Know your Customer


The conventional wisdom for product design and marketing says pay attention to the customers. Learn as much as you can about their needs and wants and then design the product on the basis of information. The customer is then part of you R&D department.

But the customer can be crucial to your R&D in a totally different and often overlooked way. You can learn a great deal by watching how your customers misuse and abuse your product after they buy it. Major breakthroughs in new products and innovative product redesigns have come from watching the customer “trash” the original intent and use a product in a totally different way.

By paying attention to how customers actually use, misuse, and abuse products, you’ll have the world’s largest R&D team and an endless supply of ideas with which to work.

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, Lectures, Line of Sight

Flatten your Organization


Flattening the organization means that each manager becomes responsible for more people. There is a limit to the number of people that one person can supervise, but this span of authority varies widely between jobs. Most people imagine that a manager can only handle a few subordinates. In reality, proper delegation allows you a surprisingly wide span, allowing a much flatter and leaner organization.

Your organization should have the best structure for achieving its goals. This structure shows the internal divisions of the organization; and the relationships between them. The structure is not fixed, but evolves to meet changing conditions. Unfortunately, this generally means a drift towards more complex structures, with more divisions, extra layers of management, longer chains of command, less delegation and more centralization. Endless levels of management can be used for minor rewards and recognition.

The proliferation of management layers is hopelessly inefficient. It forms an army of people whose only job is to force information to travel through a long and convoluted route before it is used, and makes sure that decision makers become hopelessly remote from the operations.

Delegation has clear advantages and empowerment allows you to reduce the layers of management. So the best type of organization is as flat as possible, with only a few layers of management. The organization must be flat, so that the top is connected to the people who actually make the money.

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, Line of Sight

Differentiation Strategy


With the differentiation strategy, the unique attributes and characteristics of a firm’s product (other than the cost) provide value to customers. Because a differentiated product satisfies customers’ unique needs, firms following the differentiation strategy usually charge premium prices. To do this successfully, a firm must truly be unique at something or be perceived as unique. The ability to sell a good or service at a price that exceeds what was spent to create the product’s differentiated features allows the firm to outperform its rivals and earn above average returns.

 Rather than costs, the differentiation strategy’s focus is on continuously investing in and developing features that differentiate a good or service in ways that customers value. Overall, a firm using the differentiation strategy seeks to be different from its compititors along as many dimensions as possible. The less similarity between a firm’s goods or services and those of competitors, the more buffered the firm is from rival’s actions.

 A product can be differentiated in an almost endless number of ways. Unusual features, responsive customer service, rapid product innovations and technological leadership, perceived prestige and status, different tastes, and engineering design and performance are examples of approaches to differentiation. In fact, virtually anything a firm can do to create real or perceived value for customers is a basis for differentiation. The challenge is to identify features that create value for the customer.

 My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, Line of Sight