The Customer You Think You Know
By Stephan Engelen · 2026-07-06
The Customer You Think You Know
One of the observations that has stayed with me throughout my career is that successful technology companies rarely lose their way overnight. Looking back, there is seldom a single disastrous decision that explains why a company gradually loses momentum. More often, the decline begins with a series of perfectly rational decisions, each of which makes complete sense when viewed in isolation. Only years later does it become apparent that these decisions had one thing in common: they were all taken on the basis of an increasingly outdated understanding of the customer.
This may sound surprising. After all, growing companies possess far more information about their customers than young start-ups ever did. They conduct satisfaction surveys, measure Net Promoter Scores, analyse usage data, monitor conversion rates and maintain sophisticated CRM systems that capture every customer interaction. Product managers organise customer councils, sales teams bring back market intelligence and Customer Success departments systematically collect feedback after implementation. Objectively speaking, leadership teams know more about their customers than ever before.
And yet, I have come to believe that they often understand them less.
The difference between information and understanding is subtle, but fundamental. Information tells us what customers are doing. Understanding requires knowing why they are doing it, what has changed in their environment, which frustrations remain unresolved and, perhaps most importantly, which questions they are no longer asking because they have already accepted that nobody will solve them. That kind of understanding rarely emerges from reports or dashboards. It develops through curiosity, observation and direct exposure to the messy reality in which customers make decisions every day.
In the early days of a company this happens almost automatically. Founders have little choice but to spend time with customers because there is simply no organisation between them and the market. They listen, they observe, they improvise and they adjust. Product strategy is not developed during quarterly planning sessions but emerges from hundreds of conversations in which assumptions are continuously challenged by reality. Looking back, many founders remember this period as exhausting and chaotic. I increasingly suspect it is also the period during which they understand their customers better than they ever will again.
Growth changes this relationship in ways that are almost impossible to avoid. As companies become larger, leadership naturally moves away from the market and towards the organisation itself. New managers are hired, reporting structures become more sophisticated, governance becomes more formal and investors quite rightly expect greater predictability. None of this is problematic in itself. In fact, it is a necessary consequence of building a sustainable company. The unintended consequence, however, is that leadership no longer experiences the customer directly. It experiences an organisational interpretation of the customer.
That distinction may appear academic, but I believe it explains why so many companies begin to lose strategic clarity despite employing highly capable people. Sales describes the customer from the perspective of opportunities won and lost. Marketing interprets the customer through campaigns, positioning and conversion data. Product Management translates customer requests into prioritised roadmaps. Customer Success focuses on adoption, retention and support. Finance measures profitability and lifetime value. Each perspective is valuable. Each captures an important part of reality. Yet none of them represents reality itself.
Somewhere between all these perfectly legitimate interpretations, leadership gradually loses direct contact with the market. It continues to receive more information than ever before, while becoming increasingly dependent on organisational filters that inevitably simplify, categorise and sometimes distort what customers are actually experiencing. Ironically, the better the organisation becomes at managing information, the easier it becomes to mistake information for understanding.
Meanwhile, the customer continues to evolve. New competitors reshape expectations. New technologies redefine what is possible. Buying processes change. Decision makers change. Problems that once justified purchasing a product quietly disappear while entirely new challenges emerge. Customers rarely announce these changes explicitly. They simply begin asking different questions, evaluating different criteria and expecting different outcomes. The company, however, often continues refining solutions for the customer it originally learned to understand years earlier.
This is the point where many discussions about sales execution, marketing effectiveness or product innovation begin to miss the real issue. Leadership assumes it is dealing with an execution problem, while in reality it is increasingly making decisions based on a mental model of the market that no longer reflects the market itself. The strategy may be executed flawlessly. The product may improve continuously. Sales may become increasingly efficient. Yet all these improvements risk optimising an understanding of the customer that has slowly become obsolete.
Perhaps this is why companies that continue to reinvent themselves display a characteristic that has little to do with technology or organisational sophistication. Their leaders remain intellectually humble. They never assume they fully understand the market, regardless of how successful they have become. They continue to visit customers long after they no longer have to. They remain curious even when experience tempts them to become certain. Above all, they recognise that the most dangerous moment in the life of a successful company is not when it stops listening to customers, but when it sincerely believes it already knows them.
The greatest responsibility of leadership, therefore, is not merely to define strategy or to execute it with discipline. It is to ensure that the organisation never loses its ability to rediscover the customer. Every other capability—product management, positioning, marketing, sales, artificial intelligence and even strategy itself—depends upon that single discipline. Once leadership begins solving yesterday's customer problems, the future becomes little more than an increasingly efficient repetition of the past.