“Value can only be defined by the ultimate customer. And it’s only meaningful when expressed in terms of a specific product (a good or service, and often both at once) which meets the customer’s needs at a specific time.” 1
One of the fundamental differences between the traditional plan/processes based approach and the lean-agile approach lies in the way they organize themselves. While the traditional plan/processes based approach is organized around the process which is shaped by cost, time, and scope (the Project Management Triangle), the Lean-Agile approach is organized around Value. And value can be only defined by the customers based on the importance or usefulness of the product or service. Yet a product or service can only be important or useful if they satisfy a need(s) of a customer(s).
Therefore, without agreeing a clear definition of the customer, value cannot be delivered. As a Lean-Agile Solution Stream2, the customer is the main group of people who we intend to create value for by solving a specific problem or problems. They are the reason our product or service exists in the first place. For example, customers can be “tourists” for the product of “a tourism guide book”, or “cancer patients ” for a health service of “oncology”. If people stop travelling due to a pandemic outbreak or some other reason, there will be no “tourists” anymore, and your “tourism guide book” becomes almost completely useless without “tourists”. Or if someday cancer is completely cured and eradicated, the oncology service becomes unnecessary. Thus, Products or Services can only be meaningful if the customer exists to begin with. Therefore, if we don’t clearly know who our customers are, our activity most likely cannot create any value.
Why do we need a clear definition of customer and user?
Any product or service creation activity requires the complex collaboration of human actions. Until the intended value reaches the customer, many different parties such as external suppliers, different internal departments, internal and external users involve the process into different stages.3 Let’s take a very high-level example from the Public Health Service: A patient who has symptoms of illness and is seeking help calls the GP for an appointment; an admin answers the call and refers the patient for an appointment; the patient is examined by a GP for diagnosis; the patient might need some tests and a sample is taken by a nurse; samples are sent to a laboratory; a laboratory assistant applies tests and so on. Throughout the treatment process from appointment to recovery, there are many different users such as: GP, nurse, admin and lab assistant who are involved in the process as well as their various internal and external departments. For the Lean-Agile Solution Streams, this complex nature of the product or service delivery process often creates a challenge around staying focussed on the customer problems rather than -internal or external- users’ needs.
Customer is defined in The Cambridge English Dictionary as “a person who buys goods or a service”, whereas User is defined as “someone who uses a product, machine, or service”. However, regardless of the traditional plan/processes based or the Lean-Agile approach, “Customer” and “User” are often used interchangeably in solution streams. This interchangeable usage and blurred separation between customers and users sometimes causes confusion around who is our -ultimate beneficiary of the value-. We often hear from the team and stakeholders confusing terms such as “end-user”, “subscriber and paid-customers“ or ”they are also our customer (for an internal department or role)” etc. Without a clear agreed definition of the customer, the team might be pulled into different directions by the users or departments who have a strong voice. More dangerously, they might end up building a solution around departments and users rather than building a solution around the value for customers. A displacement between customers and users would eventually lead the team to a position where they are trying to optimize efficiency for departments and users rather than focusing on the customer problems and value. Therefore, it’s important to have a clear separation between customers and users throughout the Lean-Agile Solution Stream.
Customer vs User
In Lean Enterprise, Humble, Molesky and O’Reilly explain the difference between Customer and User based on whether they pay for the Product or Service or not.4 They also give social network “users” as an example of “User” definition. Based on this “payment” based definition, for example, we don’t pay for Facebook, then, we would be Users not Customers. I want to challenge this “payment” based “usage” of the Customer and the User from Product Management perspective. First of all, there is always an exchange between the customer and the value which is provided by a Product or Service. For example, “Users” still have –Customer- Lifetime Value for social networks such as Facebook and it’s paid for by advertisers or data “buyers”. To this extent, it’s not quite different from a subscription based service from a value creation perspective for customers regardless of differences of the business models. Platform still needs to meet with its customer needs to keep them on the platform. Only in this case, some other type of customers are paying our “subscription fees”.
When it comes to Public Services, this “payment” based definition for the Customer and User becomes more common terminology. For example, in her brilliant book Good Services, Lou Downe highlights the importance of the user-centric approach and the risk of building services around departments rather than building them around value. Nevertheless, she uses only “User” as an “ultimate value receiver” not “customer”. Unsurprisingly, GDS also uses only “user” in its Service Manual.6 However, without clear separation between people who benefit from the value (customer) and people who are contributing to the value creation (user), we might end up with a situation such as building a service step of health service around for example GP surgery admins (users), rather than patients (customers).
We also pay all government services through fee, tax and contribution or cost avoidance to society. I understand the negative connotations of the word “Customer” for Public Services. It presumes that “Public Services” are “free” and therefore, beneficiaries of Public services are “Users” rather than “Customers.” This assumption rules out public ownership and tax based payment. Therefore, there is no “free” service or product. And secondly, we all deserve to be treated as “customers” anyway.
We accept a different definition for Customer and User based on their position against the value:
Customer: A group of people or organization whose problem is intended to be solved by the solution (service, product or both). They represent the ultimate beneficiary of the value creating activity. In most cases (but not necessarily), they pay in exchange for the value. Payment would be via purchase, fee, tax, direct or indirect barter, contribution or cost avoidance to society.
User: A group of people who actively contributes to a value creating activity by using knowledge, products, systems and tools. However, all value creating activities don’t create value necessarily. Unlike Customers, in most cases Users are paid in exchange for their labour. For example, while “tourists” represents Customers for “tourism guide book”, “content editors”, “designers” and a variety of other direct contributory roles represent Users. Or similarly based on our previous example in Public Health Service while “patients who have symptoms of illness and are seeking help” represent Customers for a Public Health Service , “GP”, “Admin”, ”Nurse” and any other direct contributory roles represent Users.
Undoubtedly, User problems and their feedback are also important for a Lean-Agile Solution Stream. However, the service and product (or both) needs to be designed and developed to create value by solving customer problems, not the user and organization needs. Therefore, agreeing a clear value based definition of the customer and user helps the team to have a better understanding of customer problems and to build a customer-centred Lean-Agile Solution Stream. They would less likely be pulled into different directions and lose their focus on the customer problems.
1. Lean Thinking; James P. Womack, Daniel T. Jones; Simon & Schuster, 2003; page: 16 ↩
2. Lean-Agile Solution Stream: Lean-Agile Initiatives in any Area (product or service), any Size (portfolio, program, team) or any Stage (discovery, development, GDS alpha, GDS beta, live etc.) ↩
3. Value Stream ↩
4. Lean Enterprise; Jez Humble, Joanne Molesky, and Barry O’Reilly; O’Reilly, 2015; page: 64 ↩
5. Government Digital Services (UK) ↩
6. https://www.gov.uk/service-manual ↩
To download Google Doc version of the article: <<Please click here>>