The Secret to Market Adaption
By Mark Wardell @MarkWardell | January 15, 2014
Running a business requires versatility. These days, there is no final version of a product or a service. The key to success is continual improvement, adaptation to the needs of customers and that magic ability to predict what people want, before they want it.
To do this, you need to have a solid yet flexible operations team in place to manage the daily grind of your business while being closely attuned to the market climate at large.
The vast majority of businesses don't strive for this type of strategic operating - most are trend followers vs. trend setters. If your goal is to be a true innovator, a few internal operations changes will get you there. Here's how you can develop an Operations Strategy to help you navigate market changes and come out on top.
First, start by asking what it is your business does well. Is it the way you manage customer relationships? Is it your ability to innovate in a particular area? Or is it a unique specialization of skills within your industry.
Next, think about the people who work with you. Why are they there? Do they share any unique qualities? If your employees are few - or non-existent - think about yourself, your partners, or the people you would like to hire and consider the same questions.
As you develop your Operations Strategy, keep in mind that operations are not simply about your ability to produce a particular product or service (although it may be reflected in this). It's about focusing on the one or two outstanding abilities that define your business in the market. Knowing your strengths - both what you excel at and your human capital - will be the key to your success.
An example here might help.
A successful high-end restaurant I know was not as busy during the weekday lunch hour as the owner would have liked. In an effort to increase sales, the owner decided to offer a new lunch menu consisting of quick, low-cost meals.
The experiment seemed to work as lunchtime sales increased, but the new format also attracted a new crowd. Slowly, his original clientele started disappearing and since the new crowd wasn't interested in high priced fine dining, his evening sales began to suffer as well. As a result, total sales began to drop.
The owner eventually returned to his original formula and regained his customer base, but not without taking a significant financial hit in the process.
In this case, a strategy that more clearly identified the core competencies of the business would have made all the difference. To adapt to the slowing lunch sales this business could have acted more strategically, by deciding to adapt a lunch menu in keeping with the brand of the business (core competencies) and hiring a marketing agency to help find new ways to reach the ideal target clientele strategically.
Remember, the key to building on your strengths, rather than diluting them, is how you distinguish and distance yourself from your competition while continuously engaging your target customers. This is ultimately how you can secure your position as an industry leader and adapt quickly to market changes.
Part of your success here will be about focus.
For example, it is often better to outsource tasks that are not in harmony with your defined competencies rather than take on too many unrelated tasks and risk spreading yourself too thin.
A business we work with in the automotive supply industry has begun outsourcing the warehousing and distribution of their products, which allows this particular business to focus more of their resources on sales and marketing. The result has been a more focused team, happier customers and significant growth for the company.
As you execute your Operations Strategy, be consistent at all costs.
Customers are turned off by inconsistencies. Inconsistencies, even positive ones, lead to uncertainty and uncertainty raises questions about the integrity of your business as a whole. If something appears to be out of place in one location, your customers will conclude that the incident is not isolated. As a result, those inconsistencies make your business appear out of control, even if it is not.
Invest time developing a strategy now and I guarantee you'll be equipped to adapt to any changes in the market, no matter what the nature of your business.