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The Market-Aligned Organization

November 01, 2006

At certain points during an organization’s growth, reorganization is inevitable. One of the more recent approaches is to completely align a company with its market.

In a market-driven alignment, an organization abandons the typical product-centered structure and instead identifies various customer segments around which to align all its departments, processes, services, and product development efforts. The entire organization may even be divided into specialized business teams that fully support each customer segment, cater to individual customer requirements, and tailor solutions to meet segment needs.

The advantages of a customer-focused alignment are plentiful. Customers benefit by having a single source for all information, services, goods, and problem solving. Because market-driven organizations make it so easy for customers to conduct business with them, they make it that much more difficult for customers to defect to the competition.

Additionally, when customer focus and value-added service is such a high priority, word gets around. The company can boost sales by attracting new customer groups and new market opportunities. 

When implemented well, the right alignment strategy can result in improved customer relationships, responsiveness, satisfaction, and better all-around information-sharing for the organization. While this can be great for customers, it isn’t always an easy endeavor for the business.

Here are three chief requirements for creating a truly market-driven alignment.

  1. The organization must change its entire structure. This completely new way of viewing and interacting with customers demands radical and widespread restructuring. Companies can’t just change their customer contact processes or add some new technology. They must transform all their internal structures and systems to completely remake the organization along a new archetype.

  2. Cultural obstacles must be addressed. Renouncing traditional product or channel silos can be a difficult adjustment, particularly for more mature organizations. The sales team, for instance, may be reluctant to give up long-established geographic territories to in favor of selling to a specific (and largely new) market segment. As with any reorganization, employees will need to be fully coached into making the change. All metrics and incentives should also support the new customer satisfaction goals. 

  3. Investments must be made to ensure exceptional information systems. Responsiveness is the critical objective to staying close to the customer, and that requires rigorous information sharing. Providing customers with seamless interactions depends on employees having access to a single, reliable information source. Databases must be current, and information must be delivered in a coordinated manner so that sales reps and other employees can make decisions on the fly.