By Lauren Fenthum
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The common misconception amongst businesses is that the secret to success lies in the company being solely customer-orientated. Whilst it is true that success requires customer-focus in order to thrive, it is not the only aspect that needs to be taken into account when measuring the success of a business. In order to grasp the full undertaking of what it means for a business to be successful, one needs to look at the ecosystem in which the business is developed, to really gain insight into what values are being satisfied.
Research has shown that companies that have focused solely on customers, at the expense of other components within the business ecosystem, showed to have significantly less profitability as well as business performance, compared to those that opted for a more balanced approach. The research further showed, that although meeting customers satisfaction is critical in order to measure success, it takes a number of aspects in order for the company to reach full profitability.
It is important for businesses to understand the difference between a consumer-orientated approach and that of a marketing- orientated approach. Many companies see the term “customer-orientated” as that of simply meeting the customers expressed needs on a short-term basis, and others see market-orientated being that of meeting customers hidden needs over a longer-term. This shows the difference between being driven by customers and that of driving the market. This lead to the theory of the “jobs-driven approach”, where insights were created by focusing on customers latent needs formulated by different models. The jobs-based approach increased market share by 80%, and thus became the dominant model for modern product, service and experience innovation.
The jobs-based approach became successful because it clearly outlines what the customers value. This allows companies to innovate their existing products and services in order to better customer experience. The company should look at visually mapping value flows between the different components within the business ecosystem to help pinpoint exactly what is working and what needs to be changed. It is important to understand that value needs to flow between the different components, as this shows the interactions throughout the customer lifecycle.
As we see the economy shifting away from single-sided markets to a more multi-sided segment that offers a larger platform to retailers, there is more space for products and services to be provided, which thus has the potential to reach an increased amount of potential customers. The key to success should not be predominantly relied on that of customer-focus, but rather to focus on other components in addition to that of customer focus. It is important to look at the values within the business ecosystem and to organize them in such a way that both the business and the customers are satisfied. Customer-focus alone is not enough for your business to succeed, rather take a more holistic approach, by taking all factors into account. This way you are able to monitor the longevity of your company whilst maintaining customer satisfaction.