Capturing Customer Inputs - A Summary

2008-08-28

That has been the marketing mantra for the past two decades, and although great strides have been made as a result of the customer-driven movement, the voice that managers are listening to needs to be silenced in order for marketing and development to be more successful. It is no longer sufficient for managers to simply gather customer requirements. Rather, they must know precisely what types of information are needed and what types of information they are collecting in order to create a more accountable model of innovation. As in most disciplines, managers need a common language around which to discuss issues and build a shared understanding. The innovation process is no different. Knowing that jobs, outcomes, and constraints are desired inputs and that solutions, specifications, needs, and benefit statements hinder the successful execution of the innovation process gives managers a new language to consider when talking with external and internal customers. (This post is excerpted from “What Customers Want: Using Outcome-Driven Innovation to Create Breakthrough Products and Services” by Anthony Ulwick.)

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How to Make a Profit on Underserved Customers: Redesigning the Business Model

In a HBR article (“Bottom-Feeding for Blockbuster Businesses”, which took a close look at bottom-feeders-companies, David Rosenblum, Doug Tomlinson and Larry Scott have offered some lessons to transform your own industry’s unprofitable, market segments into lucrative ones-if you’re willing to stop looking at so called bad customers as pariahs and start looking at them as untapped opportunities. One lesson is redesigning the business model. According to Rosenblum, Tomlinson and Scott, making a profit on underserved customers required a new business model-usually a pared-down product offering and a streamlined way of selling and delivering it. These companies shared a number of characteristics: (i) A Simplified Offering; (ii) Minimal Marketing Expenses; (iii) Personal, Convenient, and Pleasant Service; (iv) Judicious Use of Technology; (v) Structural Efficiencies; Realistic Financial Targets.

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Differentiation: Begin with the Consumer

2008-08-27

Although there are examples of firms successfully employing a highly differentiated strategy seemingly without much regard for cost (Hewlett Packard in calculators, for example), and others that have dominated an industry for some period of time with a virtually undifferentiated product at the lowest possible cost (such as Texas Instruments), these easily perceived extremes are rare in practice. A problem with the either/or approach is that most of us know firms that seem to fit both categories. Using the either/or approach of cost vs. differentiation provides little help in distinguishing the players in most industries. Most firms cluster toward the middle of the low-cost/high-differentiation spectrum. As a result, most of the major airlines offer a relatively similar product to the customer, both in characteristics and cost. In this middle ground, where most companies in many industries seem to fall, arises the greatest confusion about strategy.

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Principles of Breakthrough Strategy: Choosing a Unique Strategic Position

According to Constantinos Markides, there are six simple but fundamental principles underlying every breakthrough strategy. One of these principles is to choose a unique strategic position for the company. In every industry, there are several viable positions that companies can occupy. The essence of strategy is, therefore, to choose the one position that our company will claim as its own. Strategy is all about choosing and a company will be successful only if it chooses a distinctive (i.e. different from competitors’) strategic position.

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How Strategy Innovation Is Implemented: The Case of Moen Corporation (Part 3)

As presented in the previous posts, yet in the early 1990s, Moen Corporation, located in North Olmsted, Ohio, found itself in a challenging situation. The company was losing market share and not positioned well for the changes that were beginning to take place in the market. To transform the company in order for it to grow, newly installed CEO, Bruce Carbonari, implemented a range of reforming strategies which brought fruitful successes. However, the company did not have a reliable process for the identification of new products. They needed a way to determine a corporate strategy and accompanying product plan that would help them to meet the higher growth rate they desired. Two teams (i) Project Periscope Team and (ii) the Extended Periscope team have been formed in order to move a plumbing fixtures company to a new level of excitement and innovation in the industry. Besides, some more strategies are also utilized. (This post is excerpted from The power of strategy innovation : a new way of linking creativity and strategic planning to discover great business opportunities by Robert E. Johnston, Jr., and J. Douglas Bate.)

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Vital Roles of CEOs: Develop the Building Blocks for Future

According to Mark Thomas, Gary Miles, and Peter Fisk, vital roles of the CEO is to identify, develop and protect the key building blocks with which future business models will be built. Having identified the key building blocks of future business models, the next step is to be sure that they are developed. (This post is excerpted from The Complete CEO: The Executive’s Guide to Consistent Peak Performance by Mark Thomas, Gary Miles, and Peter Fisk.)

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Industry Analysis Technique: The Nine Forces (Part 1)

Organizations and the industries in which firms operate are embedded in a broad environment, which can significantly impact the competitiveness of both industries and organizations. The starting point then of any strategic analysis is some form of environmental analysis- generally STEEP/PEST analysis-followed by Industry Analysis or Porter’s Five Forces, which together provide a structural framework outlining an industry and a unique and perhaps more holistic perspective on a firm’s competitiveness. Uniting these two techniques creates a powerful framework for not only identifying the forces operating in a particular industry, but the impact of environmental factors on these very forces. These two techniques combined provide a much broader approach to business and competitive analysis. The technique is called “The Nine Forces.” In this post, excerpted from Chapter 6 of Business and Competitive Analysis: Effective Application of New and Classic Methods by Craig S. Fleisher and Babette E. Bensoussan, introduces three basic levels of organizational environments in which firms operate.

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