A Look at “Create Value for the Customer” and the Results Dimension

by Ken Snyder

“Create Value for the Customer” is one of the Shingo Guiding Principles in the Results dimension of the Shingo Model. In the current Model, it is the only principle in this dimension. Within the Shingo Model, our working definition of this principle is:

“Ultimately, value must be defined through the lens of what a customer wants and is willing to pay for. Organizations that fail to deliver both effectively and efficiently on this most fundamental outcome cannot be sustained over the long-term.”[1]

The working definition of the Results dimension is:

“Great results are the outcome of following the principles that govern the results. The closer one emulates ideal behaviors, the closer they are to achieving enterprise excellence – consistently delivering ideal results to all stakeholders.”[2]

Common Misunderstandings

In teaching this dimension and principle, we usually experience some common problems, such as:

Suggestions Regarding “Create Value for the Customer”

Various people have suggested rewording this principle to address the problem of “Who is the customer?” Two suggestions are worth noting:

We are persuaded by the suggestion that the organization needs to create value for all stakeholders, while not diluting the necessary focus on the paying customer, and support the slight change to the wording of this principle to “Create Value for All Customers.”

Suggestion Regarding “Results”

Results must be measured in all dimensions with regard to all of the Shingo principles in the Model. A suggestion to ensure this focus is to eliminate “Results” as a dimension and to infuse “Results” into the other three dimensions and into every principle. A conjoined suggestion is that a clear emphasis be placed on KBIs. The reasoning is that KBIs (i.e., leading indicators) drive KPIs (i.e., lagging indicators). KPIs are measured only to ensure that the KBIs are actually driving the ideal results. We find this suggestion very reasonable because it addresses the question about the principle and the dimension being equal, it resolves the question about results in other dimensions, and it places the focus on KBIs.

If “Results” is eliminated as a dimension and infused into all the dimensions and principles, it raises the question of where should the principle “Create Value for All Customers” go? We are persuaded by the suggestion that this principle is about the “whole” organization “aligning” around a “common purpose” of creating value for all customers. It is only reasonable, therefore, that this principle be included in the Enterprise Alignment dimension.

[1] Shingo Model handbook, 2019

[2] ibid

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