This document discusses how companies can maintain market leadership through a strong focus on customers. It recommends that companies: 1) Understand what customers truly value in order to define their market leadership approach. 2) Identify "customer-driven market anchors" - guiding principles that enable autonomy and focus on consistently delivering customer value. 3) Achieve market leadership by mastering delivery of value to customers along key dimensions like operational excellence, customer intimacy, or product innovation, as exemplified by companies like Starbucks, Dell, and Nike.

1. Maintaining Market Leadership
Through Customer Focus
Susan Wheeler
SVPMA
February 4, 2004
www.consultpathfinder.com

2. Pathfinder Background
Founded 2000
Three principals
Process improvement through focused
business strategy
Target Customers
Software, engineering, hardware
Non-profit

3. Topics
Understand What Customers Value
Define Types of Market Leadership
Identify Customer-Driven Market Anchors
Achieve Market Leadership by Delivering
Value

4. Don’t Lose Sight
The role of Product Managers
Focus on the business
Once successful companies
Case-in-point: Gateway

5. Customer Value
Can you be everything to everyone?
Who are the right customers?
Does it pay to fire customers?
What do customers value?

6. Customer Value Reflects
Benefits and Costs
Costs Benefits
Value = Costs - Benefits

7. What is Value?
In the mind of the customer, a product or
service is of value if what is delivered is
Worth What Was Paid
How do you know what customers
value?

8. Value Dimensions
Operational Excellence
Starbucks
Dell
Customer Intimacy
Nordstroms
IBM of the ’60s and ’70s
Product Innovation
Intel
Nike

9. Value Dimensions
Mastery of one
Proficiency in two
What is your value focus?

10. Customer-Driven Market Anchors
Anchors – lens
Guiding principals
Enable autonomy

11. Success - Starbucks
Premium Pricing
Focused advertising
Lo
cat
i on
, lo
cat
Aggressive growth ion
, lo
cat
ion

12. Market Anchors - Starbucks
Convenience
Location
Easier ordering
Quality/consistency
A latte in Cleveland is like a latte in
Sacramento
Driven by Company Culture

13. Success – Dell Computer
Convenience
der
o-or
Bu ild-t Integrated logistics
Manufacturer direct

14. Market Anchors - Dell
Price
Integrated logistics
Convenience
Online ordering
Build-it-yourself
Payment options
Online problem solving

15. Gain Market Leadership
Relation between anchors and market
leadership
What are your market anchors?
Using anchors to move towards market
leadership
Where are you now?
Where are you relative to your competitors?

16. Where are You on the
Value Continuum?

17. Value Chain Analysis
Systematic approach to analyzing
activities that create and build value
Product Management can influence or
control many value chain activities
Primary and Support activities

18. Primary Activities
Inbound logistics
Operations
Outbound logistics
Marketing and sales
Service

19. Support Activities
Procurement
Technology Development
Human Resource Management
Firm Infrastructure

20. Recap
Gain deep understanding of what your
customers value
Identify your key value dimension
Determine how well you deliver value