Want to tap into real business growth? Ask not what you can do for your company, but what your company can do for its customers.
Forgive the cliché, but in a world of increasing change, it's crucial advice. After all, keeping your focus trained on what's going on beyond your company's borders could mean the difference between just chugging along to steaming past the competition.
Fast-growth companies (and those that want to be) absolutely must take an external, or "outside-in," view to running their business. Here are four broad benefits of looking outward:
Anticipation. Outside-in thinking naturally asks questions about how the outside world is changing, and unleashes creative thinking about the implications. The payoff comes from seeing opportunities and threats sooner. You will be less vulnerable to surprise attacks by competitors, and new products will be more successful. The early mover invariably has an edge over the reactive responses of later entrants that have fewer degrees of freedom.
Adaptation. When everyone in the company is attuned to the customer experience and its pain points, there is more likely to be a wide-ranging and ongoing search for pain relief. Are deliveries either too early or too late for the customer? Are customer service reps watching the clock and leaving callers frustrated? This is the essence of continuous improvement, or Kaizen approaches, and, as Toyota showed, this is a powerful way to grow.
Alignment. When outside-in thinking is embedded in the organization, there are fewer turf battles and more collaboration; resources are used more productively. Customers applaud, because they benefit from clear accountability for their welfare. They aren’t left in limbo while navigating among your silos. Everyone in your company shares the same information, so you can readily identify the most valuable customers to nurture and retain, all of which helps you grow.
Alliances. The more your organization is focused outside, the more opportunities you will spot to partner with suppliers, large customers, and even rivals (in the spirit of 'coopetition'). To do well in a highly networked world, you need to co-create with partners and jointly shape an ecosystem in which all of you can grow. If your partners do well, so will you and vice versa.
The benefits from anticipation, adaptation, alignment, and alliances are hard to realize fully in practice. They can easily be subverted by complacency (“we have mastered the recipe for success”) and short-run performance pressures that put inside-out thinking in control. It takes vigilant market-driven leaders to keep making the case that your customer’s interest be put first and next the well-being of your strategic partners. None of that will happen unless your organization really starts to think outside in.
-Co-authored with George S. Day, professor of marketing at the Wharton School