The tremendous technological progress of the past two decades has created an urgent need for organisations to transform themselves in order to be better able to face the continuously emerging challenges. This technological change has brought with it a generation of young, talented and independent-minded people who are growing up in a society where the opportunity for discovery and innovation is available at the touch of a button, while the culture of knowledge for self-determination has become the hallmark of a democratic life style. As such, this new reality means that the organisations of the future will increasingly become dependent on the creativity and talent of their people to meet the expectations of their clients.

Hence, one can argue that businesses need to start rethinking ways of creating the right environment in which this new generation of employees are able to feel useful and where senior management is able to capitalise on their strengths. However, in order for this to happen, organisations need to move away from being static, bureaucratic, rule-oriented organisations where a clear command system dominates, to ones that are dynamic, flexible and that have innovative, oriented teams.

With this new reality in mind, Joshua Zammit, deputy vice-president of Actavis Group, during his speech at the FHRD’s National Annual HR conference organised recently, advocated the concept of “Employees first, Customers Second”, a management approach that takes us away from the conventional wisdom that businesses need to always put their customers first. This relatively new concept affirms that value is driven by employees rather than the customers. The rationale behind this concept is that innovation and competence comes from having talented employees that are committed to the mission and vision of the organisation, who understand their role and contribution to wealth generation and whose expertise and capabilities are what the client expects. Zammit strongly believes that by putting employees first, businesses can bring about crucial change in the way that an organization creates and delivers value for its customers as well as differentiates itself from its competitors. Indeed, Zammit observed: “People are the one thing that you can differentiate from your competitors. Hence, focus on people if they are the ones that are creating value.”

This is especially important as 21st century organisations need to focus on value generation and hence need structures and systems that accommodate this, explained John C. Grech during his presentation at the same conference.

Vineet Nayar, CEO of HCL Technologies (HCLT), in his book Employees First, Customers Second: Turning Conventional Management Upside down said that whereas a number of organisations still believe in the idea that value is generated by their customers, true value stems from the contact between the customer and the employee. In addition, Nayar argued that by creating a combination of engaged employees and accountable managers, a business could create unique value for itself, its customers and the individuals involved in the organisation. Hence, when a business aims at putting employees first, it is the customer who will then ultimately come first and hence benefit the most, but in a far more transformative way then the traditional and conventional “customer care” programmes.

An organisation that has implemented the “Employees First, Customers second” philosophy is ‘Starbucks’, a worldwide renowned coffee company. Starbucks aims to connect first with employees and second with its customers as it believes that when employees are treated well and hence are happy, then its customers will in turn be treated well. Moreover, Starbucks recognises the fact that whereas its competitors may be able to reproduce its products, they can’t replicate the talent, creativity and knowledge of the people that serve its product to the customers. Indeed, Starbucks chairman, Howard Schultz commented: “We built the Starbucks brand first with our people, not with consumers. Because we believed the best way to meet and exceed the expectations of our customers was to hire and train great people, we invested in employees.”

For Joshua Zammit, HR people are the best catalysts for the transformation that is required in the 21st century. They are able to offer their organisations the competence of aligning the talent and skills of the employees to the objectives and goals of the business, provided that managers are in tune with the overall strategy of the organisation.

Ms Camilleri is a researcher

at the Foundation for Human Resources Development