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February 15, 1998

Four-Wheel Drive

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In the early days of Internet car sales, I was interested in a car listed online for sale in Dallas. It so happened that I was going to have a layover in Dallas–Fort Worth on my way to another destination. I arranged for the owner of the car to bring it to the airport, where I got in the vehicle and took it out on the road. It turned out that this was one sweet ride. Because of the test-drive, I was confident in saying I would buy the car and wanted it delivered to my home in Fayetteville.
That’s what we need to do before we’re fully committed to our strategies. Take them out for a spin.
Specifically, what I’m saying is this: think through how the strategy you have in mind is likely to affect your organization in four key areas:
1. your customers,
2. your people,
3. your offering, and
4. your financials.
These four elements are universal for all organizations—large and small, old and new, for profit and not for profit. Furthermore, like the wheels on a four-wheel-drive car, they all need to be engaged and working properly if you want to get maximum traction in a slippery patch on your journey.

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Of course you can’t foresee exactly how your strategy will impact these four areas. But carry out as rigorous an analysis as you can, and it may turn up some problems you’ve got to address as you move ahead in implementation.

Customer Model

Every organization has customers, even if you don’t refer to them as such in your organization. They may be clients, buyers, consumers, patients, patrons, members, investors, lenders, stakeholders, donors, or supporters. Regardless of what they’re called, these are people who are external to your organization and who are making a decision about your value proposition. Their purchase or donation counterbalances your costs to do business. Consequently, they are crucial to your operation. In your promotional material, you very well may claim that they are the reason for your operation.
All of which makes it absolutely necessary that you think through how the strategy you have under consideration might impact your customers.
Let’s say your company made its name selling personal care products to women. Now, though, you’re entertaining the possibility of branching out into men’s products. Is there a danger that men will feel uncomfortable being associated with your brand? Might your long-time customers think you’re no longer as committed to women?
Or imagine that you’re leading a technology company. You have a new vision to become the Henry Ford of home security, using your own technology to provide low-cost security options to low- and middle-income folks and not just the higher-wage earners with a case of nerves who usually install home security systems. What resistance are you going to encounter in taking an offering to a body of potential customers who aren’t used to buying such a service?
Whatever kind of organization you have, and whatever strategy you’re itching to put into place, you’d better try to anticipate beforehand how it’s going to affect that group of people who make your organization’s existence possible—your customers. Get some reliable customer feedback so that you can get a line on consumer thinking. Figure out what, if anything, you can do to make sure they’re happy with the changes that are coming.

Ask yourself…
1. What will this strategy do to impact our legacy customers (those folks we have built the last few years on)?
2. How might this strategy help us or hurt us with the new customer segments we are chasing?
3. Where will the new strategy expose us to customer push-back?
4. Which customers will need special hand holding through the strategy implementation period?
5. How will this strategy make us think about our customers differently? In other words, how will our customer engagement model change?

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