Imperatives for Market-Driven Strategy Pertemuan 1 Buku 1 Hal: 1-40 Matakuliah : J0504 - Strategi Pemasaran Tahun : 2009 Imperatives for Market-Driven Strategy Pertemuan 1 Buku 1 Hal: 1-40

Learning Objective Pivotal role of market-driven strategy in designing and implementing business/marketing strategies Links between business/marketing strategy and corporate strategy Challenges in the modern environment Bina Nusantara

Characteristics of a Market-Driven Strategy Becoming Market- Orientation Determining Distinctive Capabilities Achieving Superior Performance Customer Value/ Capabilities Match

Market-Driven Strategy (1) Becoming market-oriented Customer focus Competitor intelligence Cross-functional coordination Performance implications

Characteristics of Market Orientation Customer Focus What are the customer’s value requirements? Competitive Intelligence Importance of understanding the competition as well as the customer Cross-Functional Coordination Remove the walls between business functions Performance Consequences Market orientation leads to superior organizational performances

Becoming a Market-Oriented Organization Information Acquisition Cross-Functional Analysis of Information Shared Diagnosis and Coordinated Action Delivery of Superior Customer Value

Market-Driven Strategy (2) Becoming market-oriented Customer focus Competitor intelligence Cross-functional coordination Performance implications Determining distinctive capabilities

DISTINCTIVE CAPABILITIES “Capabilities are complex bundles of skills and accumulated knowledge, exercised through organizational processes, that enable firms to coordinate activities and make use of their assets.”

Capabilities Disproportionate (higher) contribution to superior customer value Compelling Logic of Distinctive Capabilities Provides value to customers on a more cost-effective basis

Capabilities Desirable Capabilities Applicable to Multiple Competition Situations Superior to the Competition Difficult to Duplicate

Market-Driven Strategy (3) Becoming market-oriented Customer focus Competitor intelligence Cross-functional coordination Performance implications Determining distinctive capabilities Types of capabilities

Organization’s Process EXTERNAL EMPHASIS INTERNAL EMPHASIS Outside-In Processes Inside-Out Processes Spanning Processes Financial management Cost control Technology development Integrated logistics Manufacturing/ transformation processes Human resources management Environment health and safety Market sensing Customer linking Channel bonding Technology monitoring Customer order fulfillment Pricing Purchasing Customer service delivery New product/service development Strategy development

Market-Driven Strategy (4) Becoming market-oriented Customer focus Competitor intelligence Cross-functional coordination Performance implications Determining distinctive capabilities Types of capabilities Creating value for customers

Matching Customer Value and Distinctive Capabilities Value Requirements Distinctive Capabilities

CREATING VALUE FOR CUSTOMERS Customer Value: Value for buyers consists of the benefits less the costs resulting from the purchase of products. Superior value: positive net benefits Creating Value: “Customer value is the outcome of a process that begins with a business strategy anchored in a deep understanding of customer needs.”

Psychic and physic costs Value Composition Product Services Employees Image Benefits Value (gain/loss) Monetary costs Costs (sacrifices) Time Psychic and physic costs

Market-Driven Strategy (5) Becoming market-driven Marketing sensing capabilities Customer linking capabilities Aligning structure and processes

Market Driven Initiatives Market Sensing Capabilities Effective processes for learning about markets Sensing: Collected information needs to be shared across functions and interpreted to determine proper actions. Customer Linking Capabilities Create and maintain close customer relationships

Improve existing processes Process redesign Aligning Structure and Processes Potential change of organizational design Improve existing processes Process redesign Cross-functional coordination and involvement Primary targets for reengineering: Sales and marketing, customer relations, order fulfillment, and distribution