I was listening to an executive explain his company’s dismal results to a group of people: “The recession of 2008 and 2009 caused us to have our first year-over-year sales decline in the company’s history.”

“No,” I thought as I heard this.  “The economy didn’t cause your poor sales results. You had bad sales results because your customers didn’t buy as much from you.”

Be careful about inferring causes for your business results.  All you know for sure if your sales decline is that your customers paid you less money.  But you may not know why.

Of course, the economic situation may have been one reason that this company’s customers purchased less. But to reflexively assign blame to the recession instantly leaves the company off the hook. Was it only the economy that depressed sales, or was it something the company did, or did not, do that affected customer behavior?

Maybe the economic situation just exposed how weak the company’s customers’ loyalty is.  Or that this company is not as agile as its competitors.

The direct drivers of your results are, for better or worse, the actions your customers take.  There are many things you do that affect how your customers act, many (most) of which have a stronger influence than external factors.

Success is self-inflicted.


  • Randy Bosch
    Feb 01, 2010 - 11:53 am

    Steve, Excellent post, thank you. Life is not lived in a straight line – unless you’re the turkey in Nassim Taleb’s illustration. If business results are one’s reason for being, instead of creating, improving, serving, giving back, their “Thanksgiving” is coming, and they are the turkey!

    Time to go self-inflict some success through serving others!

  • Clemens Rettich
    Feb 01, 2010 - 18:20 pm

    I love the line “The direct drivers of your results are, for better or worse, the actions your customers take.” The point that this is all about our customers and our relationships with them that are the inescapable fundamentals in business, cannot be made often enough. You have put it very elegantly.

    There is some sense that the economy, the ‘relationship economy’ is something totally new. It isn’t. Great brands have always been based on great relationships. The bad ones just show the rot faster in this unforgiving climate.

    Keep up the great writing.

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