The market-led organisation
The market-led organisation

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The market-led organisation

4 How do organisations become market leaders?

Drucker (1992) wrote:

The five most important questions you will ever ask about your organization [are]:

  • What is our business?

  • Who is our customer?

  • What does our customer consider value?

  • What have been our results?

  • What is our plan?

Can you answer these questions for your own organisation? I don't expect you to know all the answers now. Try to think about them as you read through the text. I shall refer to them again at the end of this session.

As you can imagine there are many books about how to become a successful organisation – most make recommendations on identifying target markets and redesigning organisations to produce superior value to the customers within the target markets. I have chosen one such book The Discipline of Market Leaders (Treacy and Wiersema, 1996) to illustrate how, once organisations understand who their customers are, success comes from focusing their activities on providing superior value to them.

In their study, Treacy and Wiersema (T&W) discuss the concept of market orientation. They recommend organisations to:

  • choose their customers

  • narrow their focus to provide a unique ‘value proposition’ to their market

  • dominate their market.

T&W describe three ‘value disciplines’ to use to dominate a market:

  • product leadership

  • operational excellence

  • customer intimacy.

An organisation must focus on one of these value disciplines but, at the same time, it must pay close attention to the others.

The following is an explanation of these ideas.


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