Market Effectiveness™ is a series of cross functional business processes that need to be well managed and orchestrated. Market Effectiveness is akin to the supply chain and poor performance at either of these will result in bad business performance.
Market Effectiveness is defined as the set of business processes that convert strategy into the design and creation of demand for goods and services in the marketplace. This process is shown in the graphic below: In businesses we have worked with, we have found that leadership teams have a tendency to focus on these processes as silos rather than a cross functional business process that should get the same attention as the supply chain. Just like the supply chain, it needs to have a clearly defined set of key performance indicators (KPI’s) that measures performance against strategy. Not having these is one of the fundamental reasons for why 90% of companies are poor at Strategic Execution™. Market Effectiveness starts with a solid business strategy that defines the expected performance of the business in the marketplace. The business strategy needs to provide the organization with a clear understanding of the product platforms (includes both products and services) that will be responsible for the company’s success. Not understanding the importance of the previous sentence is fraught with risk. We have worked with many companies who have product platforms that are poorly managed. A properly managed product platform will have a clear product roadmap with the appropriate marketing and sales strategies. Next to strategy, the product roadmap is the second most important part of Market Effectiveness. It is based on customer knowledge, market intelligence, technology emphasis and a well thought through product lifecycle revenue model. An effective product development process will require developing the detailed tactics for all of these elements. Once the product roadmap is defined and approved it is now all about effectively creating demand in the marketplace. Many executives don’t understand the importance of the role marketing plays in creating awareness and demand. I often hear them whisper that they don’t understand what marketing does. On the other hand, they believe they fully understand what sales does but don’t recognize how poorly thought through marketing strategies hamper sales force effectiveness. Once again, this is primarily the result of managing marketing and sales as silos rather than integrated activities. It is likely that the concept of Market Effectiveness is new to you, but obvious once you think about it. Whether it is or not, ask yourself if your business leaders look at the business this way. Some do. Black & Decker and Procter & Gamble are two examples of companies who clearly understand this process and routinely measure it. Unfortunately, most of the clients we work with don’t appreciate importance of a Market Effectiveness strategy for their business and each product platform. They don’t have skilled product managers who understand product portfolio management and don’t put enough emphasis on the relationship between strategy, product management, product development, marketing and sales. Ask yourself if your company has the appropriate focus on Market Effectiveness. If not, you may want to put a lot more thought into it. Group50 Business Management Consulting Firm has a series of assessments and workshops that will help you through your thought process. You can find out more about our Business Process Consulting Services and Market Effectiveness practice here. Subscribe below to Group50’s blog to stay on top of the latest trending topics:
About the author: Jim Gitney is the CEO of Group50®Consulting and specializes in the development and implementation of manufacturing and supply chain strategies. Jim and the Group50 team are all former executives with well-known manufacturing and distribution companies who understand what it takes to put together and manage the implementation of a successful strategic plan and elevate Market Effectiveness. Group50 has designed a series of strategic assessments, workshops and strategic execution tools that eliminate the existence of Anti-Strategy. You can reach us at (909) 949-9083 or send a note to firstname.lastname@example.org.
- Post Merger Integration ( PMI ) Playbook
- Supply Chain Playbook
- Change Management in the Current Environment
- Supply Chain Risk – Supply Chain Resiliency – Knowing Where You Are Vulnerable and Doing Something About it
- Re-Opening Your Business – Best Practices Series
- World Class Manufacturing and Distribution – Wrap Technologies – Group50
- What is Fractional Marketing – A Way to Accelerate Your Market Effectiveness
- 90 Day Tactical Plan – The Future of Your Business
- Market Effectiveness in the New Normal
- Managing Your Way Through 2020