Reviewed in Canada on December 8, 2010
Many companies have gone out of business because their leaders were convinced that "if we build it, they will come." It made no difference what the "it" was, how well it was built, or who "they" were. In the Introduction to this book, Rick Kash and David Calhoun state their core thesis with commendable clarity: "Demand id what customers possess in terms of the needs and desires - emotional, psychological, and physical - they want satisfied, and have the purchasing power to satisfy." Here what they explain and illustrate throughout their lively and eloquent narrative: The forces behind the transition (i.e. paradigm shift) from a supply-driven to a demand-driven economy; how to develop and then execute the business strategies required by that shift, and the tools needed throughout the execution process.
The demand to which Kash and Calhoun refer "includes physical, psychological, and emotive components. Backed by economic purchasing power. Demand is both near term and longer term, not just the instantaneous fulfillment of a need...Demand is multidimensional in other ways and can be classified as current, latent, and emerging." They list the ten primary characteristics of a demand-driven corporation (on Page 9) and then shift their attention to a series of rigorous analyses of exemplary companies to explain
o How McDonalds, "a troubled and aging company just five years ago," found new life, continuous growth --- and new profits
o Why Allstate began to offer more features and customer choices that that were contrary to conventional risk practices
o How and why Best Buy thrived while its #1 competitor (Circuit City) went out of business
o How and why Bud Light Lime became one of the fastest-growing new beer introductions during the past 25 years
Yes, I realize that these and other exemplar companies discussed by Kash and Calhoun are among the largest global corporations. However, the lessons to be learned from them can be of substantial benefit to all companies, regardless of their size or nature. They may be even more valuable to small companies that have severely limited resources and much thinner margins for error, if any margins at all. Obviously, the major challenge is this: How to become a demand-driven business?
Here is a representative selection of what Kash and Calhoun examine and then explain, clearly and thoroughly:
1. How to master the skills needed to ask the right questions, obtain the right answers, and then take appropriate action.
2. What "demand gaps" are and how to reduce or (preferably eliminate them
3. In a demand-driven organization, what innovation is...and isn't.
4. What the opportunity identification process involves
5. What demand-driven pricing principles are and how to apply them
6. What the "Thesis of Winning" is, with Bill Walsh discussed as an exemplar
7. How to formulate and then disseminate an "Enterprise Message"
8. Why and how demand-driven strategies and tactics must also be customer-driven
9. "Fast Cycle Response Time"
10. Eight "tough questions" business leaders must ask/answer about themselves, their companies, their category, and their competitive marketplace
With regard to #10, Kash and Calhoun make excellent use of questions throughout their narrative, strategically inserting "checklists," admonitions (i.e. do's and don'ts), and mini-summaries. The various questions challenge their reader to think about what must be done and how to get it done.
In this context, I am reminded of other questions posed by Peter Drucker and Fred Reichheld that also focus on what is most important as opposed to what is merely urgent. All demand-driven leaders would be well-advised to consider five from Drucker: What is your mission? Who is your customer? What does your customer value? What results are you trying to accomplish? What is your plan? My person favorite among Drucker's quotations is this one: "There is surely nothing quite so useless as doing with great efficiency what should not be done at all." Asking the right questions will help to avoid making that mistake.
Here are two more from Reichheld, both very important: "Based on your experience with us, on a scale of one to ten, would you recommend us to others? Then, whatever score you receive, if it is less than a ten, you immediately follow up by asking: What would we have to do to earn a ten from you?"
It is easy to ask questions but sometimes very difficult to know what the right questions to ask are. Rick Kash and David Calhoun help the business leaders who read this book to do that and, better yet, they help them to obtain the right answers so they and their associates can design a design-driven model and then formulate a cohesive, comprehensive, and cost-effective plan to make that compelling vision a prosperous reality.