This article was produced and financed by BI Norwegian Business School
Better at listening to customers when times are difficult
Frequent changes create conflicts in the workplace. However, some companies manage to make turbulent times benefit their customers.
BI Norwegian Business School
Changes and reorganisation are high on the agenda in many organisations.
This may for instance include new and more efficient ways of doing things or new ways of organising the work.
Changes are rarely popular, even if they turn out to be for the better. Reorganisation often sparks internal conflicts and may embitter communication between various departments in the enterprise.
Managers may have reason to fear that increased tension and more frequent conflicts between company employees will affect the quality of products and services, and result in poorer customer service.
However, a higher conflict level will not necessarily harm the company. This is the conclusion of a study conducted among 221 employees in Finnish industrial companies. The study included employees in research and development (R&D) as well as production.
Frequent organisational changes can actually make it easier for companies to develop products and services that the customers are more satisfied with, according to Associate Professor Silja Korhonen-Sande of the Norwegian University of Life Sciences (NMBU) and Associate Professor Jon Bingen Sande of BI Norwegian Business School.
Few critical questions
First the researchers looked at how efficiently people who work in development and production use information about their customers to create better products and services. This is knowledge they receive regularly from their contacts in the sales and marketing environment.
It is not always the case that good collaboration between employees in sales and production ensures that information about customers is used to develop better products and services.
Even if you learn that customers would like something other than what is currently on offer, it is easy to continue making the products just as before.
“In fact, the study shows that companies characterised by good cooperation and few changes are not very good at applying the information they have about their customers. In such stable organisations, exchange of information between people in sales and production often takes on a merely symbolic role,” researches have concluded.
“Too few critical questions are raised asking What do our customers really want? What can we do to make products that better meet the customers’ requirements and expectations?
Interferes with and improves established work methods
The study shows an entirely different picture in organisations that go through frequent organisational changes.
“When employees in sales and production cooperate well, frequent changes make people who develop and create products apply their knowledge about customers in decision-making,” says Korhonen-Sande.
Good collaboration fosters a sense of security and trust. Organisational changes interfere with established work patters. This is in fact a cocktail that may be good for the customers.
“Employees in research and development as well as in production departments become more motivated to ask critical questions and apply the customer information to improve activities in turbulent times,” Sande points out.
Conflict is a double-edged sword
Not surprisingly, the study confirms that frequent organisational changes increase the level of conflict between different functions in the organisation.
This means that an organisational change is a double-edged sword. Even though changes create more conflicts in the workplace, such conflicts may be turned into a competitive advantage.
According to researchers, companies that manage to combine organisational changes with good cooperation will become better at listening to the customers’ needs.
Advice to managers
However, the positive effect of the changes does not come automatically.
The researches recommend that to make the most of the positive effects of changes, companies must invest in establishing a common understanding between departments before the changes are introduced.
This may be done through e.g. job rotation and by recruiting employees with knowledge of technology, not just sales and marketing.
“Sales and marketing people who understand objectives, routines, technology and information needs in research and development as well as in production, contribute to better communication and a greater ability to solve any conflicts that may arise.”
- Korhonen-Sande og Sande: Getting the most out of cross-functional cooperation: Internal structural change as a trigger for customer information use. Industrial Marketing Management 43, 2014.