The 2020 Mid-Year Economic Update_long

Customer Intimacy is Operational Excellence

The following is an excerpt of Brent Grover’s latest distribution management book, The Little Black Book of Strategic Planning for Distributors, published by Modern Distribution Management. In this article, Grover argues that distributors need to focus both on operational excellence and customer intimacy, rather than choosing one over the other.

In The Discipline of Market Leaders: Choose Your Customers, Narrow Your Focus, Dominate Your Market, authors Michael Treacy and Fred Wiersema adapted the three Michael Porter strategies into a choice of customer intimacy, operational excellence or product leadership. If you agree that product leadership isn’t a viable option for most distributors, the authors leave distributors with two alternatives: operational excellence or customer intimacy. In the following paragraphs I will argue for a third option.

Strategic choice No. 1 in The Discipline of Market Leaders is operational excellence, keeping costs down ...

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