The Only Hope For Sustained Growth

Do you want to be the master of your technology for which you will seek markets, or do you want to be the master of your markets for which you can create customer-satisfying solutions?

This choice is as relevant today as it was when Theodore Levitt first raised it in his classic Harvard Business Review article, Marketing Myopia, published in 1960. A business should never be defined by the product or service it sells, but by the needs that customers satisfy with its offerings. A decline in revenue growth is generally not due to competition or technical obsolescence, but to a failure to define the market in terms of customer needs.

The railroad industry, for example, “did not stop growing because the need for passenger and freight transportation declined. That grew. The railroads (got) in trouble not because the need was filled by others (cars, trucks, airplanes and even telephones) but because it was not filled by the railroads themselves. They let others take customers away from them because they assumed themselves to be in the railroad business rather than in the transportation business. The reason they defined their industry incorrectly was that they were railroad-oriented instead of transportation-oriented; they were product-oriented instead of customer-oriented.” (Marketing Myopia, Harvard Business Review)

Most companies don’t know what type of customer needs to capture to guide the creation of new or improved offerings or how to obtain them. Leaders struggle with how to drive growth because they don’t know which of their customers’ needs are left unmet by their own offerings and their competitors’ offerings. If you don’t know where the customers’ unmet needs lie – where the market opportunities lie – then you’re forced to guess how to create new value, which leads to high failure rates and a lot of frustration. This is totally unnecessary!

Contrary to popular opinion, customers can tell us what they want when we ask them what they are trying to accomplish rather than asking them for product specifications. For example, Henry Ford is famous for his quip that “If I had asked people what they wanted, they would have told me a faster horse.” Wrong question, Mr. Ford!

If Henry Ford had asked people “What do you want to accomplish with a horse?,” they would have readily told him they want to:

• Travel from point A to B
• Transport freight
• Plow a field
• Enjoy outdoors recreation with friends and family
• Etc.

All of these statements are easily obtained from customers. They provide rich opportunities for innovation and growth because they are the true customer needs, not product specifications. To ensure continuous growth, companies must discover and act on what customers are trying to accomplish, how they measure success, and where they are struggling. It’s the only hope for sustained growth.