Sales keys for the “Operationally Excellent” companies

This is the third installment in my series of blogs about the implications on sales of Tracey and Weirsma’s great book “The Wisdom of Market Leaders”.   Last week we talked about companies who compete based upon “Product Leadership” (see below) and today we’re going to discuss those who compete on Organizational/Operational Excellence… from the sales perspective! If you remember, your target market is smaller than you think because certain customers will want different things from their vendor.  So, even though you may target “small to medium sized businesses with more than fifty knowledge workers in New England”, certain customers will want certain things from their vendor and other companies will want other things.  You, as a vendor must decide upon which of these definitions of value you will compete, and thus organize yourself and run your business.  As the authors so beautifully put it: “If a company is going to achieve and sustain dominance, it must first decide where it will stake its claim in the marketplace and what kind of value it will offer its customers.” The three types are: Companies who compete on “Customer Intimacy.”  These companies appeal to those customers who look for “the whole product” and want a vendor who will understand their business and their needs.  IBM and Nordstrom are such companies. Companies who compete on “Operational Excellence.”  These companies appeal to those who look for the lowest total cost.  Staples and Acer are such companies. Companies who compete on “Product Excellence.”  These companies appeal to those who look for the latest and best products.  Apple and Lexus are such companies. So, what are the...

Sales leaders, here are keys for the “customer intimate” sales force

If you choose to compete on “customer intimacy” here are some key things to prepare for. Sales lessons for companies. Use these in your sales training

Last week I wrote about Tracey and Weirsma’s great book “The Wisdom of Market Leaders”.  Over the next few blog articles I want to dive in a bit deeper and analyze each of those types from a sales perspective.  This is, afterall, a sales blog! If you remember, your target market is smaller than you think because certain customers will want different things from their vendor.  So, even though you may target “small to medium sized businesses with more than fifty knowledge workers in New England”, certain customers will want certain things from their vendor and other companies will want other things.  You, as a vendor must decide upon which of these definitions of value you will compete, and thus organize yourself and run your business.  As the authors so beautifully put it: “If a company is going to achieve and sustain dominance, it must first decide where it will stake its claim in the marketplace and what kind of value it will offer its customers.” The three types are: Companies who compete on “Customer Intimacy.”  These companies appeal to those customers who look for “the whole product” and want a vendor who will understand their business and their needs.  IBM and Nordstrom are such companies. Companies who compete on “Operational Excellence.”  These companies appeal to those who look for the best price.  McDonalds and Acer are such companies. Companies who compete on “Product Excellence.”  These companies appeal to those who look for the latest and best products.  Apple and Lexus are such companies. So, today let’s look at companies who compete on customer intimacy… If that’s you, You...

Your target market is smaller than you think!

Choosing target markets and market segmentation have always intrigued me. Although there are many ways to think of it, I had an epiphany as I reread one of the classic strategy books over the weekend

Choosing target markets and market segmentation have always intrigued me.  Although there are many ways to think of it, I had an epiphany as I reread one of the classic strategy books over the weekend, the book is “The Discipline of Market Leaders” and is available at Amazon through this link. In the book the authors claim that to be a market leader you need to focus and organize around one of three distinct principles that customers value. Operational Excellence, BEST TOTAL PRICE.  You are middle of the market (or lower) at the best price with the least inconvenience. Low price, hassle free service, think Wal-Mart Product Leadership – BEST PRODUCTS. Offer products that push performance boundaries. Value Proposition is “we offer the best products, period!”  Continuous innovation, they will obsolete their own products.  Think Apple and Nike Customer Intimacy BEST TOTAL SOLUTION.  Delivering NOT what the market wants, but what individual customers want.  They do NOT pursue one time deals; they pursue long term, mutually profitable relationships. Selecting a Value Discipline in which to operate is a strategic goal, it is a central act that shapes every subsequent plan, in short it is strategy.  The authors argue that “If a company is going to achieve and sustain dominance, it must first decide where it will stake its claim in the marketplace and what kind of value it will offer its customers.”  The choice of a value discipline shapes the company’s subsequent plans and decisions, coloring the whole organization, from its culture to its public stance. To choose a value discipline is to define the very nature of a company. Examples:...