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Speaking-AFCEA-Jan 2010.mp3 (10938 KB)
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For many years, we have witnessed the failures of excessively product-driven management, where companies focus on the development and sales of products (from automobiles to toaster ovens) to their customers—whether the customers really want those products or not. This was epitomized by the “build it and they will come” mentality.
Numerous companies faltered in this over-the-top product mindset, because they were focused not on satisfying their customer’s needs, but on selling their wares. Think GM versus Toyota or the Days Inn versus The Four Seasons.
Now however, organizations are moving from product- to customer-focused management, with the basic premise that organizations need to engage with their customers and assist them in getting the most value out of whatever products meet their requirements best. In the world of IT, this is the essence of user-centric enterprise architecture, which I created and have been advocating for a number of years.
Harvard Business Review, in January-February 2010, has an article titled “Rethinking Marketing” that asserts that “to compete, companies must shift from pushing individual products to building long-term customer relationships.”
· Product-driven companies—“depend on product managers and one-way mass marketing to push a product to many customers.”
· Customer-driven companies—“engage individual customers…in two-way communications, building long-term relationships.”
The old way of doing business was to focus on the products that the company had to offer and “move inventory” as quickly and profitably as possible. I remember hearing the sales managers yelling: “sell-sell-sell”—even if it’s the proverbial Brooklyn Bridge. And the driver of course, was to earn profits to meet quarterly targets and thereby get bigger bonuses and stock options. We saw where that got us with this last recession.
The new way of doing business is to focus on the customer and their needs, and not any particular product. The customer-driven business aligns itself and it’s products with the needs of its customers and builds a long-term profitable relationship.
“In a sense, the role of customer manager is the ultimate expression of marketing find out what the customer wants and fulfill the need), while the product manager is more aligned with the traditional selling mind-set (have product, find customer).”
The new model for a customer-driven enterprise is the epitome of what social computing and Web 2.0 is really all about. In the move from Web 1.0 to 2.0, we transformed from pushing information to stakeholders to having a lively dialogue with them using various social media tools (like Facebook, Twitter, blogs, discussion boards, and many more)—where customers and others can say what they really think and feel. Similarly, we are now moving from pushing products to actively engaging with our customers so as to genuinely understand and address their needs with whatever solutions are best for them.
In a customer-focused organization, “the traditional marketing department must be reconfigured as a customer department [headed by a chief customer officer] that puts building customer relationships ahead of pushing specific products.”
I think that the new organizational architecture of customer-driven management is superior to a product-focused one, just as a emphasis on people is more potent that a focus on things.
Similar to customer-driven management, in User-centric enterprise architecture, we transform from developing useless “artifacts” to push out from the ivory tower to instead create valuable information products based on the IT governance needs of our customers.
Further, by implementing a customer-focus in information technology management, we can create similar benefits where we are not just pushing the technology of the day at people, but are rather working side-by-side with them to develop the best solutions for the business that there is.
>See my CIO Magazine article: Encourage Social Networking, Without Discouraging In-Person Meetings
Appreciate any comments.
>Web 2.0─”a perceived second generation of web-based communities and hosted services — such as social-networking sites, wikis, and folksonomies — which aim to facilitate creativity, collaboration, and sharing between users. The term gained currency following the first O’Reilly Media Web 2.0 conference in 2004. Although the term suggests a new version of the World Wide Web, it does not refer to an update to any technical specifications, but to changes in the ways software developers and end-users use webs.”
“Web 2.0 websites allow users to do more than just retrieve information. They can build on the interactive facilities of “Web 1.0” to provide “Network as platform” computing, allowing users to run software-applications entirely through a browser. Users can own the data on a Web 2.0 site and exercise control over that data. These sites may have an “Architecture of participation” that encourages users to add value to the application as they use it. This stands in contrast to very old traditional websites, the sort which limited visitors to viewing and whose content only the site’s owner could modify. Web 2.0 sites often feature a rich, user-friendly interface based on Ajax, Flex or similar rich media. The sites may also have social-networking aspects.”
“The concept of Web-as-participation-platform captures many of these characteristics. Bart Decrem, a founder and former CEO of Flock, calls Web 2.0 the “participatory Web” and regards the Web-as-information-source as Web 1.0.” (Wikipedia, including Tim O’Reilly and Dion Hinchcliffe)
From a User-centric EA perspective, Web 2.0 has implications for all perspectives of the architecture:
Architects need to recognize and build the power of Web 2.0 and its participatory and collaboration capabilities into their target architectures and transition plans.
andyblumenthal 