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Add custom attribute to customer grid

we do need to show that attribute in the Customer Grid then we need to follow the steps below:

 

Step: 1. Override the   Mage_Adminhtml_Block_Widget_Grid 

 

Step: 2. Edit your config.xml

 

In Step 1 we had not overridden the _prepareCollection() because calling return parent::_prepareCollection(); will reset the collection to default magento implementation and searching will not work for custom attribute column.
For this we had overridden the setCollection() and added our custom attribute to select. You can change it as per your requirement.

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