Why can’t government operate more like a business? We’ll probably here this refrain as the mid-year elections ratchet up their noise. Often this question is used rhetorically to bash governmental inefficiency. But, there are real ways in which government doesn’t, can’t, and shouldn’t operate like a business.One difference is the target market.
Public and social organizations are often charged with serving ALL the market. Compare the postal service to private package delivery. The postal service must serve every person in every ZIP code in the country; companies like FedEx have nothing but profit motive compelling them to serve or not serve a rural address or a high crime area.
Public and social organizations often pursue the mission of serving those at the edges of the market. Compare homeless shelters to apartment complexes. Shelters active seek to serve those who cannot afford the service on their own.
This Stanford Social Innovation Review article points out that some companies are starting to look to “extreme customers” for better understanding about products and markets. Extreme customers are those at the far ends of the bell curve for using the product or service.
At the far left end are people who actively avoid or bash the product, or use the product with severe constraints such as a physical handicap.These customers can teach organizations about overcoming objections, reaching new demographics, and inclusive design.
At the far right end of the curve are rabid fans and expert users. These customers can be bellwethers signalling market changes, evangelists for your brand, and trove of information regarding polishing your product or service.
Studying the edges has proved fruitful. Trends from the edge, such as Universal Design and bringing third-world products to developed countries, can lead to market-changing developments and innovations.
For instance, GE has begun exporting low-cost medical devices from India to other developing markets around the world. As the article quotes, “The new X-ray machines developed in India weigh just about 110 kilograms compared to the traditional models that are around 250 kilograms. Compared to the older, digital high-frequency X-rays, the new variant is available at a tenth of the cost.”
With the pressure to drive down medical costs and increase medical service here in the U.S., it seems only a matter of time before products designed for what we consider the extremes of the developing world find their way into our markets.