Question

Topic: Strategy

Should Customers Drive Organizational Structure?

Posted by Anonymous on 10/8/2004 at 11:03 AM ET 125 Points
A lot of buzz was created regarding the concept of the customer driven company. But do so-called "customer driven" companies really perform any better than companies that are not so customer driven? Moreover, what role should my customers/approach to customer segmentation play in the organizational structure of my company?
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RESPONSES

  • Posted by Chris Blackman on 10/8/2004 at 9:50 PM Member
    Hmm...

    You decide how to sructure your organisation, not the customer. Based on your strategy.

    Strategu basical decides everything from structure to process, budget to resources. People have paid lip service to the concept for years but now the idea is gaining traction and companies that implement properly are gaining the edge both in the market and back on the bottom line.

    But you MUST structure your organisation to meet the market on its own terms.

    My approach to configuring strategy for an organisation like yours is to look at the segments and key portfolios, identify the major sales targets by segment-portfolio intersect. Using all the usual strategy development tools, and having this portfolio/segment map in mind, develop your key straegies and objectives into a clear strategy map.

    Then configure you resources to support the tactics need to deliver on he strategies.

    I know this seems simplistic. Fact is, it works in every organisation I have worked with, from small to very large.

    If you need help on the basics contact me via my website in my profile.

    Hope this helps.

    ChrisB
  • Posted by Peter (henna gaijin) on 10/8/2004 at 9:53 PM Accepted
    I disagree - customers should be considered in how you set your organizational structure. You want to make sure the customer can work as easily as possible with your company. The area this affects most are the so-called customer facing positions (especially sales but also includes marketing).

    I remember reading that IBM for years had different groups selling to corporate customers. One groups selling mainframes, another PCs, another software, etc. This meant that many different salespeople from IBM were calling on the same person at the customer, and the IBM salespeople were not working together (sometimes even competing against each other). IBM reorganized their sales to be based around customers, and now it is just one sales person bringing all the products packaged together as a solution in to the customer.
  • Posted on 10/9/2004 at 1:29 PM Member
    You set the organizational structure – just make sure it is not going to objectionable to your target customer; and be flexible to modify the structure according to the most profitable balance of meeting company needs and customer needs.
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