Why Millennials Are Leading Us Toward An Employee-Centric Future

It is time to evolve from “customer comes first” to “employee comes first”

Over the last seven decades, the orientation of businesses has shifted, driven to a great extent by the generational predilections of customers, employees, and managers. Today, Millennials, and Generation Z, are thrusting into an exciting new era.

In the 1980s, the focus of businesses was on the competition. Michael Porter had coined the term “competitive advantage” and this term, competition, came to dominate the agendas of CEOs and investors. We were infatuated by the battles between Dell and IBM or Microsoft and Apple. We followed with great interest in the battles for control between activist investors and Wall Street. This era was popularized by movies like Pretty Woman and books like Barbarians at the Gate.

Learning and development programs focused on building competitive awareness and the understanding of competitive dynamics. Performance management systems and corporate cultures were oriented toward encouraging behavior that resulted in outsmarting the competition. GE’s aggressive approach of culling the bottom 10 percent of performers every year became popular and epitomizes the competitive approach of the 1980s into 1990s. That the generations of employees of that era were motivated by personal career advancement, often measured success by title or salary, contributed to this competition-focused paradigm.

But in the 2000s, something began to change. The rise of Amazon, which holds as its mission to be “Earth’s most customer-centric organization” made corporate leaders and academics take notice. They heard Jeff Bezos talk about making the competition obsolete by focusing instead intensely on the customer. Other companies followed suit. They adopted the “customer-centric design” approaches espoused by IDEO and Stanford's design school.

The generation of employees of the 2000s were asking to make business human, to have opportunities to solve human problems. Indeed, even today, the dominant focus of innovation starts with a customer focus. Alibaba and Tencent in China, Amazon and Netflix in the US are often cited as proof points that customer-centricity wins.

But the paradigm is changing once again, driven to a great extent by the demands of a new generation of employees and customers.

That the paradigms of business shift by definitions should make it no surprise that the paradigm is shifting again. Much research into Millennials and Generation Z point to the fact that these generations are more motivated by the impact that profit (competition focus) or the solving of complex problems (customer focus). They want to make a difference in the world... and they do not feel they should have to quit their jobs to do so.

What these new generations are leading us to is the era of the employee. In other words, we are starting to see that the companies winning in today’s fast-paced, digital, agile environment are increasingly seeing themselves not in the business of beating the competition or serving customers but in the business of creating successful, fulfilling work for employees.

Starbucks figured this out long ago. Howard Behar, former President of Starbucks and Howard Schultz’s right-hand man for much of Starbuck’s ride, once outlined for me what he saw as Starbuck’s most important strategic move. He said that the moment of the company’s breakthrough performance came when they decided “we are not in the coffee business servicing people, we are in the people business serving coffee.” In other words, their priority lies with the people who serve the coffee, not the people (like you and I) who purchase it.

The Business Roundtable, a collection of the 150 CEOs of the largest corporations in the US (from JP Morgan to GM) recently supported this viewpoint stating the purpose of corporations should be communities and employees ... over shareholders.

In my study of over 150 employee innovators and over 367 innovative companies, I have found this shift evident. The companies who are winning today, do not view their primary goals as beating the competition or even being highly customer-centric. Naturally, you must do both to win, but the way to achieve both is to focus on your employees ... to design an organization that empowers employees to see and seize opportunities that beat the competition and out-deliver to customers.

So, even if you want to beat your competition or out-deliver for your customers, listen to what your new generation of employees and customers are telling you. Millennials and Generation X-ers understand that corporations exist to create engaging, meaningful work for their people. When they do that, they win.

It is time to evolve from “customer comes first” to “employee comes first” if you want to remain relevant in the next decade.