Who Should Be Your Company's First Priority? A company has three main constituents: customers, shareholders, and employees. Who should be #1?

Who Should Be Your Company’s First Priority?

There is an ongoing debate over who should be your company’s first priority: customers, investors, or employees?
To be sure, this is a real dilemma for any company, including startups.
A company has three main constituents: customers, investors/shareholders, and its employees. Obviously, it needs all three. Moreover, in order to be successful, it needs all three to be happy and satisfied.
And yet, you can’t have three #1 priorities. So who should you rank as #1? This is not just semantics or a mission statement exercise. This ranking affects your long-term priorities, operational plans, trade-offs, and daily decisions.
In the ’90s, the mission statement of “maximizing shareholders value” was very popular among US companies. This became the mantra of company leaders and executives. Needless to say, it didn’t inspire and motivate employees, nor did it delight customers. Eventually, it didn’t lead to higher value for investors either.
Later on, that mantra was replaced with “customer focused”. Everyone became, or wanted to be, customer-focused. Granted that makes a lot more sense than “shareholder focused”. However, treating customers like kings and employees like pawns is not a recipe for sustainable success.
For example, in the US retail sector, Sears is ranked amongst the worst in employee satisfaction rating and is losing money. On the other hand, Nordstrom is ranked high in employee satisfaction and is also highly profitable. This is just one example out of many.

Why Employees Should Come First

I believe that employees should always come first. My rationale is very simple. Happy and motivated employees perform better. They develop better products to meet customers’ needs. They provide better service to customers. Furthermore, they find innovative ways in which to make the company perform better, and be successful.
This, in turn, makes customers happy since they get better products and service. Happy customers purchase more, remain loyal to the company, and recommend its products and services to their friends.
This makes the company successful and profitable, which of course, delights its investors and shareholders.
Thus, my ranking is:
  1. Employees
  2. Customers
  3. Investors

What’s yours?


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One thought on “Who Should Be Your Company’s First Priority?

  1. I would say both,come first you need the customers to have employees and, in one way I agree happy employees perform better give more to customers needs

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