Total Quality Management

January 23, 2009

Incorporating Customer’s Needs in the Business Definition of an Enterprise

Filed under: Customer Focus and Satisfaction — Tags: , , — Ferhan Syed @ 8:56 pm

When we define Total Quality Management, the term quality implies the customer and the product or service being delivered to the same.  Here we would attempt to understand the definition of a business enterprise in terms of its customers it serves in the marketplace.

In other words, a company’s business is defined by what needs it is trying to satisfy, by which customer group it is targeting, and by the technologies it will use and the functions it will perform in serving target market.

Based on the above discussion, let’s try to understand how an enterprise incorporate What, Who, and How into the business definition. To arrive at strategically revealing business definition, three elements need to be incorporated:

  1. Customer needs, or what is being satisfied.
  2. Customer groups, or who is being satisfied.
  3. The technologies used and functions performed-how customers’ needs are satisfied.

Defining a business in terms of what to satisfy, who to satisfy, and how the organization will go about producing the satisfaction produces a comprehensive definition of what company does and what business it is in.

Just knowing what products or services a firm provides is never enough. Products or service are not important for customers; a product or service becomes a business when it satisfies a need or want. Without need or want there is no business.

Customer groups are relevant because they indicate the market to be served-the geographic domains to be covered and the types of  buyers the firm is going after.

Technology and functions performed are important because they indicate how the company will satisfy the customers’ needs.

Source: Crafting and Implementing Strategy: Text and Readings by Arthur A. Thompson, Arthur A. Thompson, Jr., Alonzo J. Strickland

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