Monday, October 3, 2011

Evolution of the Business Orientation

It is amazing how history has molded businesses in defining the fundamentals of doing businesses. This change is evitable in the Business Orientation evolution, from extensive focus on product orientation businesses have evolved to market orientation. Now the consumer is at the core of business strategy and strategy formulations is structured through extensive focus on customer satisfaction

Orientation

Time

Description

Production

Up to 1950s

In this era the core focus of organizations was on the most effective and efficient product methodology. Under this method organizations focused on increasing production to generate economies of scale and operated with the assumption that consumer preference does not change frequently. The famous saying of Henry Ford “People will buy cars as long as it is black”

Product

Up to 1960s

Organizations contemplated on the quality of the product, extensive focus was on improving the product. The core assumption in this orientation was that product superiority is the main benefit that customers sought after. This orientation went into an extent where a mouse trap was developed in gold.

Selling

1950s to 1960s

Selling concept contemplates on using extensive selling methodology to sell products. The focus was on using promotional methods in pursuing customers to make the purchase decision. Companies sought after the skill of Selling and the money question in that era was “How to sell a fridge to an Eskimo?”

Marketing

Since 2007

The marketing orientation was the peak at the evolution of business orientation. With mistakes in history business realized the importance of identifying, anticipating and satisfying customers at profit is the way forward. Since the only source of income to any company is from revenue generated from customers, thus it was established that it is important to focus on consumers.

Market

Recently

One of the key weaknesses in Marketing orientation was that a key function was developed in organizations called marketing and the marketing department was held responsible in the satisfaction of consumers. This concept evolved with the understanding that it is not only the responsibility of a single department or function, all the functions should be customer oriented and decision making should be based on consumer satisfaction.

It is evident how business orientations have evolved learning from the mistakes. Customer is at the core of business strategy, how delighted customers are is directly proportionate to the profits of the company.

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