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am 11. April 2005
This book's concepts for strategic marketing management are so widely accepted that the popular Balanced Scorecard concept of Kaplan and Norton in 2001 decided to adopt the ideas for the "customer perspective".
The authors manage to take Michael Porter's two generic competitive strategies - Differentiation and Cost Leader - and elaborate on these to an extent never presented so elegantly before. In the process, they discover a third generic strategy - Customer Intimacy.
Thus, Treacy and Wiersema distinguish between focusing on the following value dimensions:
- Operational excellence (cost leadership / focus on supply chain management)
- Product leadership (innovation / focus on product lifecycle management)
- Customer Intimacy (service leadership /focus on customer relationship management)
These are the FOUR RULES that govern market leaders' actions:
Rule 1: Provide the best offering in the marketplace by excelling in a specific dimension of value
Rule 2: Maintain threshold standards on the other dimensions of value
Rule 3: Dominate your market by improving value year after year
Rule 4: Build a well-tuned operating model dedicated to delivering unmatched value
Expanding on the fourth rule - operating models - may the best long-term contribution of this book. The authors explain in detail and via case stories how the operating models differ for each of the three value propositions. In practice, I've learned that by explaining the operating models, many people can easier find themselves depicted than in the overall generic dimensions of cost, service or product leadership.
OPERATIONAL EXCELLENCE or Cost Leadership - Best total cost - operating model:
Key success factor: Formula!
Golden rule: Variety kills efficiency
Culture: Disciplined teamwork; Process focused; Conformance, "one size fits all" mindset
Organization: Centralized functions; high skills at the core of the organization
Core processes: Product delivery and basic service cycle; built on standard, no frills fixed assets
Management Systems: Command and control; Compensation fixed to cost and quality; transaction profitability tracking
Information Technology: Integrated, low-cost transaction systems; Mobile and remote technologies
PRODUCT LEADERSHIP - Best product - operating model:
Key success factor: Talent!
Golden rule: Cannibalize your success with breakthroughs
Culture: Concept, future driven; Experimentation, "out of the box" mindset; Attack, go for it, win
Organization: Ad-hoc, organic, and cellular; High skills abound in loose-knit structures
Core processes: Invention, Commercialisation; Market exploitation; Disjoint work procedures
Management Systems: Decisive, risk oriented; Reward individuals' innovation capacity; Product lifecycle profitability
Information Technology: Person-to-person communications systems; Technologies enabling cooperation and knowledge management
CUSTOMER INTIMACY - Best total solution - operating model:
Key success factor: Solution!
Golden rule: Solve the client's broader problem
Culture: Client and filed driven; Variation: "Have it your way" mindset
Organization: Entrepreneurial client teams; High skills in the field
Core processes: Client acquisition and development; Solution development; Flexible and responsive work procedures
Management Systems: Revenue and share-of-wallet driven; Rewards based in part on client feedback; Lifetime value of client
Information Technology: Customer databases linking internal and external information; Knowledge bases built around expertise
If you're interested in Customer Intimacy, you may want to add Wiersema's additional book on only this strategy to your shopping basket. I highly recommend both paperback books ... great value for money ;-)
Peter Leerskov,
MSc in International Business (Marketing & Management) and Graduate Diploma in E-business
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am 11. Oktober 1999
The authors are masters of the obvious. If you don't agree with the premise presented in the introduction, then a read is worth your time. The premise is simply that to become market leaders, a business must choose between operational, customer or product focus then make this focus central to their mission and value proposition. This book would be good for the reading list of an intro business strategy course.
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am 12. November 1998
Excellent content; just not a book's worth. The authors say virtually nothing more than they did in their superb HBR article of the same name a few years back. Another case of a fine 10-page idea gratuitously expanded into a book.
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am 22. Februar 2000
Winning firms focus on one of three customer value disciplines: product leadership, customer intimacy, or operational excellence. Trying to be all things to everybody is tantamount to being nothing for anyone. If your firm can't get its act together, you'll find this an inspiring book that makes a compelling case that success is only possible by having the courage to focus on specific tasks & disciplines. This seems very elementary, but I've observed many firms that refused to choose what they wanted to be, ensuring that they became nothing. This book is helpful in positioning exercises.
I have two concerns about the book. 1, it doesn't need to be this long in order to get the central idea across. 2, I'm becoming increasingly convinced that this model is counterproductive in a Geoff Moore tornado period. If you're in a high-tech tornado, wait until Main Street before applying discipline.
Aside from these caveats, I still find the simple model presented in this book as being useful in analyzing market approaches. You have to understand the model in order to know when it isn't appropriate. Product Managers, sales, marketing and product development staff need to be aware of this book and its ideas.
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am 16. Juli 2000
The message of this important book is that "no company can succeed today by trying to be all things to all people. It must instead find the unique value that it alone can deliver to a chosen market. Why and how this is done are the two key questions the book addresses." The authors focus with rigor and precision on three different "disciplines": operational excellence, product leadership, and customer intimacy. It remains for any company (for any organization, for that matter) to determine which of the three should be its primary discipline but all are obviously important...indeed interdependent. Nonetheless, one discipline should be pre-eminent. The authors examine dozens of companies which have concentrated primarily on one of the three "disciplines" so that they can select their customers and then narrow their focus inorder to gain and sustain dominance within their respective marketplaces. I think this book will be of substantial value to executives in any organization but of greatest value to those in organizations which are small-to-midsize. Unless they have dysfunctional management and/or defective products, their mastery of that discipline will enable them to compete more effectively against larger organizations which (obviously) have greater resources available. My own view is that as B2B and B2B2C continue to increase at exponentially greater velocity, leadership of ANY market will require mastery of customer intimacy and at least one (but preferably both) of the other two disciplines. In that event, the insights which Treacy and Wiersema share will be even more valuable.
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Many organizations try to be all things to all people, and end up being mediocre or worse on everything. THE DISCIPLINE OF MARKET LEADERS shows that many organizational stalls can be overcome by focusing the enterprise on being better on cost/prices, innovation that customers value, or relationships. This perspective will be very valuable to 90 percent of all organizations.
I hope the authors will go on to publish a sequel that looks at how an organization that is superb in one of these areas learns how to become superb at a second or third of the three areas. That clearly will be the future best practice that outstanding enterprises will have to shoot for.
I am not sure that some organizations are not already good at more than one area of focus: For example, a great investment bank (like say, Goldman Sachs) will have more innovative products than most of its competition in certain areas and will also offer great relationships.
The book does not say very much specifically about how to achieve an outstanding result in any one of the proposed three areas of focus. You'll have to read other books for help there. Direct from Dell is probably good for the price/cost model for most New Economy businesses and Old Economy businesses that are subject to the New Economy. For the rest, Lean Thinking will be helpful. On the subject of relationships, the Harvey Mackey books are good, such as Dig Your Well Before You're Thirsty. On innovation, everyone should read The Innovator's Dilemma. Only the Paranoid Survive is also helpful for innovators.
Pick your direction today, and move forward at warp speed!
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am 20. März 1998
The premise of the book is that successful companies direct all of their efforts towards operational excellence, product leadership, or customer intimacy. For each "discipline" (and it does take discipline), the authors present examples, generally well known, of companies that succeed because of this focus. This book manages to present a usable model for managers and a unique perspective to explain the success of many top performing companies. Most business books either present too much unrelated theory or repeat a single assertion that should be a magazine article. Every chapter of this book explains something new, and supports its main contention. The model seems to have withstood the test of time (unlike many of the companies in "In Search of Excellence" several years ago), because most of the companies profiled are still market leaders, even though the book was originally published in 1995. The model is appealing to business observers, because it is intuitive but not obvious, and it enables the reader to imagine other companies that are not profiled and fit them into the model easily. The structure of the book (one chapter about one discipline, then a chapter in-depth about an example) makes the book easy to follow, and convenient to read during a commute.
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am 19. März 1998
For what it does and the way it does it this book deserves a 10. It directly and enjoyably addresses the point it sets out to make, and gets there. The basic point is this, companies that excell in the marketplace deliver on their customer's 'value expectation' with regard to themselves. The authors describe three areas where firms can and do excell in delivering on 'value expectation', operational excellence (best value), customer intimacy (service), and product leadership (innovation). They then describe in detail each of these positions. For each of the three basic positions presented the authors offer real examples of companies using the approach their describing, as well as how they succeed using it. This is the background to the idea of product positioning - instead of a product focus, the idea here is a market sector focus. The emphasis in "Discipline of Market Leaders" is on the customer's expectation for that particular market niche. Then, with sufficient details and examples to make it understandable and applicable, the mind set and process is developed and described. You'll see some familiar and not so familiar names like Wal-Mart, Sony, and Airborne Express used as examples throughout the book. Rather than using these names as an exercise in self-promotion the authors actually make interesting and applicable points through these examples and illustrations. I found the book an eye opening and memorable business read. I probably read between 75-100 business books a year and this is one I've remembered, and I've applied the material repeatedly with success. Most of my collegues agree that in business, time is a precious commodity and wasting it is not suffered gladly. Read this book you'll find the investment worth it.
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am 15. Januar 2010
Even if the book misses some of the tables and examples that were later published in the paperback version it still is an essential piece of management literature. Especially for those working in a more strategic role it introduces a principle that is so obvious that it is quite staggering to see it was overlooked or at least neglected over the past 100 years: the principle that one can't be everybodies darling- no matter how hard one tries.
To become a truly authentic business and a leader in its field with an authentic offering there will be a point in time were some hard decisions are necessary.
The authors demonstrate that certain value propositions at some point exclude each other. Whether these are the three mentioned in this book or different ones- the underlying principle remains the same.
Strongly recommended.
PS: The examples also demonstrate clearly (now many years after the book was published) that even the best position and intention one ever had is no guarantee for future success.
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am 7. Februar 1999
Many organizations try to be all things to all people, and end up being mediocre or worse on everything. THE DISCIPLINE OF MARKET LEADERS shows that many organizational stalls can be overcome by focusing the organization on being better on cost/prices, innovation that customers value, or relationships. This perspective will be very valuable to 90 percent of all organizations. I hope the authors will go on to publish a sequel that looks at how an organization that is superb in one of these areas learns how to become superb at a second or third of the three areas. That clearly will be the future best practice that outstanding organizations will have to shoot for. I am not sure that some organizations are not already good at more than one area of focus: For example, a great investment bank (like say, Goldman Sachs, will have more innovative products than most of its competition in certain areas and will also offer great relationships).
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