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The New Market Leaders: Who’s Winning and How in the Battle for Customers by Fred Wiersema Recommendation: ••••
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Divide and Conquer Some business writers create categories and lists that seem arbitrary and obtuse. Not so with Fred Wiersema. In his new book, The New Market Leaders, Wiersema creates two simple ways to measure leadership: a sales growth index and a market value index. The first metric compares growth versus peer companies, and the second compares how much an investor is willing to pay for a dollar of sales versus peer companies. Wiersema tracked the performance of 5,000 companies, and measured their leadership using the above metrics. He then examined what those companies were doing to achieve market leadership. If you enjoyed his previous book, The Discipline of Market Leaders, you’re likely to enjoy The New Market Leaders. Another useful categorization Wiersema came up with involved customer buying patterns. He divided customers into four groups: searchers, collaborators, streamliners and delegators. He then examined which market-leading companies were serving which segments, why and how. The book contains lengthy enough case studies for a reader to understand why the company has become exemplary. Most executives will find this book stimulating and interesting. It may be helpful in strategic planning and in discussing change with other executives. Here’s an excerpt that summarizes the insights from the book: “In closing, let me sum up the most pertinent insights I gained from the market leaders. They should serve as constant reminders to the managers who keep asking, ‘What’s missing?’ First, securing market leadership is not the result of a series of isolated or episodic efforts. Instead, it grows from a process of change that you can never relax. Although your choice of a specific process is important, it is less so that your commitment to practice it relentlessly. Ingraining your current performance is less important than persistently exploring better or new ways to improve it. Second, motivation and performance will peak only when channeled toward shared ambitions and clear goals. The battle for customers isn’t a solo event. It is a team effort that requires the cooperation and commitment of every participant. Open interaction and communication – both inside the company with colleagues and outside it with customers – foster this process. Third, you need to know where you stand. Salient metrics gauge your progress; feedback mechanisms keep you on track; and frank, honest discussions, which include confronting facts directly, even if they are upsetting, are the only reliable antidotes to delusion and complacency.” (p. 222) Now that I’ve caught your attention with the insights from the book, go ahead and read it. Steve Hopkins, September 5, 2001
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