A couple of weeks ago we started our look at the difference between Inside-out and Outside-In thinking.
If we scoot to the bottom of the table…. and let’s start with the review of changes to customers
| Industrial/Information Age | Customer Age | ||
| People | Silo’s | Multi functional | |
| Specialist | Multi skilled | ||
| Isolated | Relationships | ||
| Awards – Time served | Awards – Value Created | ||
| Autocratic | Dynamic (to suit the needs) | ||
| Processes | Doing things right | Doing the right things and doing things right | |
| Manufacturing mindset | Customer Experience | ||
| Tasks/Activities and Outputs | Outcomes and SCO’s | ||
| Stocks | Flows | ||
| Products | Services | ||
| Left to Right, Top to Bottom | Customer Centric | ||
| IT | Algorithmic | Heuristic | |
| Hierarchical | Hyperlinked | ||
| Analytical | Understanding | ||
| Ownership | Access | ||
| Strategy | Top Down | Inclusive | |
| Structured and Rigid eg 5 yr plans | Agile and Adaptive | ||
| Tablets of stone | Continual Alignment to SCO’s | ||
| Market/product focus | Customer/expectation focus | ||
| Customers | Uninformed | Prosumer | |
| Loyal | Promiscuous | ||
| Forgiving | Rebellious | ||
| Locked-In | Demand Flexibility | ||
| Compliant and managed | High Expectations and fickle | ||
| Single channel | Multi channel | ||
We can probably reasonably observe, without fear of understatement, that the customer has changed forever. The reason our organisations exist, the people who pay our wages, the cause of all the work we do has evolved beyond recongnition.
- And yet has your organsation changed in response to this evolution?
- Do we do our work in a different way from the last century?
- Is work still flowing top to bottom and left to right?
- Are we thinking about how our processes connect with customer success?
In the BP Groups research and experience with the leading companies of the 21st century the answer is … YES, some in fact do understand and act on this new imperative. However the majority, including some previously prestigious names are not getting it. Look at the troubles of Nokia, Kodak, Sony, British Airways, Air India, United… the list is extensive and disturbing.
For our examples of successful transformation and realignment we can include Emirates, Zappos, Zara, Apple, Indigo, Hallmark and BMW. A wide selection from different industries, cultures and operating models. We will get to sepcifics later, for now let’s review the reason for their successful adoption of Advanced BPM, otherwise known as Outside-In. The customer!
If things are changing faster Outside than in you will fail
The acccepted business wisdom until the end of the last century was the adoption and exploration of ideas originally described by Adam Smith in the Wealth of Nations, published in 1776. This seminal work introduced the world to the concept of the sub division of labour.
Written during the advent of the industrial revolution the ‘Wealth of Nations’ created a framework for organising manufactories and people into similar skills and disciplines. In fact the original work in a Scottish pin factory demonstrated 20 fold improvements to productivity and as such became a template for achieving industrial and commercial success. Two and a half centuries later the model is still taught in business schools and academia as the way to structure and organise work. After all it worked for 200+ years?
We can’t solve problems by using the same kind of thinking we used when we created them (Einstein)
And there is the rub. The challenges we face in the 21st century are very different to those being addressed by Adam Smith and the industrialists of the Napoleonic era. Let’s get to grips with some of the shifts…
to be continued……
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Great topic and great overview, thanks for starting this discussion!
I think, we also need to map another category from inside-out to outside-in – traditional GoToMarket models, often focused on internal design points only, such as product, place, promotion and price. From an outside-in perspective we should look for customer driven terms, such as problem instead of product and proof of value instead of price, just to start with an example.
Defining those outside-in design points will help sales reps to work backwards from the customer and to respond to their needs, which are – in the IT service provider industry – pretty much like this “adapt your services to my specific situation, solve my problems and drive my results”.
Thoughts?
Steve: I found your article very insightful and I particularly enjoyed the org chart of the Tabulating Machine Company. As a sales rep in the early ’80’s, I remember using org charts regularly to figure out who to contact at my prospect company. Based on those charts, I made many assumptions, most of them wrong.
One note of contention: I have been selling technology products and services for over 30 years. At no time in my memory have I had customers I would characterize as loyal, forgiving, locked-in, and compliant and managed. Throughout my business career, clients have always had the power of choice–and exercised it when conditions merit.
Client ‘promiscuity’ (love the word! thanks!) is not a new phenomenon, and has been a perennial issue for vendors for hundreds of years. For centuries, innovation has deliberately enforced loyalty (I call it ‘shotgun loyalty’) by creating adoption hurdles for customers who might find it appealing to switch to other vendors. The practice is as old as technology itself.
Hi Andrew – thanks for sharing. The primary difference now is the speed of promiscuity 🙂 The digital age has made information available anywhere anytime, and boy does the customer know that. Accordingly old pyramids just cannot react quickly enough. In fact one organisation I work with (airline) talks about organisational rigor mortis in their competitors.
So business at the speed of light (thanks Bill) is the name of the game. No time for 5 year plans, long board meetings and slow product launches. The customer is more fickle than ever before 😉