Supply-side (rather than demand-side) economics
Unless you enjoy some form of protection (patents, regulation restricting supply etc) you will be in a market where supply is running ahead of demand. Too much ‘stuff’ is chasing too few customers.
Required Action – Make your offer more distinctive, love your customers more that your competitors
The cost of information acquisition is falling
Each year it costs less (in time and money) to learn more. Technology and the internet in particular is creating more para-experts than ever before.
Required Action – Create a thought leadership capability that you can use to maintain knowledge advantage from.
Increasing customer power
The customer is in charge; because of the previous forces, because of legislation and rights the customer more than ever before dictates market forces.
Required Action- Obsess about understanding customer, segment and market motivations, exploit the empowered customer by co-creating solutions together.
The supplier/customer interface is more diverse
You will be dealing with customers through many different channels, in ways that cut across functions and hierarchies (neither of which customers recognise or are interested in.
Required Action – Build end-to-end customer processes that remove inefficiencies from your value chain and deliver ‘joined up’ solutions.
The costs absorbed at that interface are increasing
Its getting more expensive to do business and at a faster rate than price inflation.
Required Action – Cut non-performing assets, build new forms of chargeable value, focus on previous point.
Management information is increasing exponentially
We need to be able to harvest, interpret and leverage customer/management information. Many organisations have more data than insight, more sterile reports than useful feedback.
Required Action – Sort out an MI strategy, link to IT and Knowledge Management. Get smart.
Competition is intensifying, proliferating, fragmenting and consolidating
The world we operate in is a contradictory one. Competitors are also routes to joint ventures, shared investment and the source of our potential downfall.
Required Action – Compete and partner with them, try to bury them whilst working with them, look for new ‘over the horizon’ competitors that might do things way better than you ever have.
These forces of change need to be understood and pro-actively managed. They could keep you awake with excitement instead of fear.