At the time, lots of companies were making the move from selling products to selling solutions in an attempt to differentiate themselves in increasingly commoditized markets. These solutions, priced at a premium, were intended to enhance productivity by, for instance, reducing patient backlogs. In 2001, under price pressure from the government and managed health care organizations, GE Medical Systems (now GE Healthcare) created a unit, Performance Solutions, to sell consulting services packaged with imaging equipment as integrated solutions. Ultimately, some customers may be better off purchasing products and services piecemeal. To stand out in a commoditized market, companies must understand what customers value. By combining their offerings with those of a partner, companies can cut costs even as they create higher-value solutions, as Starbucks has found through its diverse partnerships. They need experience with more than one product or service, a deep knowledge of customer needs, and the ability to traverse internal boundaries.Ĭonnection. Delivering customer-focused solutions requires some employees to be generalists instead of specialists.
Most also shake up the power structure so that people who are closest to customers have the authority to act on their behalf.Ĭapability. Customer-centric companies, such as Cisco Systems, develop metrics for customer satisfaction and incentives that reward customer-focused cooperation. JLL has experimented with both approaches.Ĭooperation. Sometimes this involves replacing traditional silos with customer-focused ones, but more often it entails transcending existing boundaries. To deliver customer-focused solutions, three things must occur easily across boundaries: information sharing, division of labor, and decision making.
They did so by engaging in four sets of activities:Ĭoordination. Some companies-like GE Healthcare, Best Buy, and commercial real estate provider Jones Lang LaSalle (JLL)-have restructured themselves around customer needs to deliver true solutions. Knowledge and expertise often reside in silos, and many companies have trouble harnessing their resources across those boundaries in a way that customers value and are willing to pay for. Companies, however, aren’t always structured to make that shift. For many senior executives, shifting from selling products to selling solutions-packages of products and services-is a priority in today’s increasingly commoditized markets.
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