Market discipline starts at the top: the leadership team must define the mission (why do customers buy from us versus the competition), vision (what needs to be done to deliver the value proposition), and strategic intent of the organization. Only then can processes, infrastructure, and assets be aligned.

by Brandon Kinsey

6 minute read

This month represents our sixth in a series of short tips on execution. Every week we discuss how you can improve each of these five KSE’s. Which one is your biggest strength? Your biggest weakness? Let’s find out.

The Importance of Market Discipline

Market discipline is the alignment of your processes, systems, and culture with your competitive strategy.

Market discipline starts at the top: the leadership team must define the mission (why do customers buy from us versus the competition), vision (what needs to be done to deliver the value proposition), and strategic intent of the organization. Only then can processes, infrastructure, and assets be aligned.

  Answer the questions below. If you answer “No” at least once, you may need to clarify your market positioning:

Are all processes, systems, and culture reinforcing the delivery of the customer value proposition?   Are you focused on adopting industry best practices?   Do employees struggle to explain how your company differentiates itself in the marketplace?     

Counterintuitive as it may sound, an execution risk consists in seeking to improve value delivery by adopting best practices. In many cases, this is a legitimate effort. A best practice is defined as a technique, method, process, activity, incentive, or reward that is believed to be more effective at delivering a particular outcome than any other technique, when applied to a particular condition or circumstance.

However, best practices are also defined as the most efficient (least amount of effort) and effective (best results) way of accomplishing a task, based on repeatable procedures that have proven themselves over time for large numbers of people or organizations. This means that best practices tend to level the playing field by making operations increasingly similar across industry players.

Again, this is a worthy goal when best practices apply to back-office operations to remove operational pain points. However, applied without thoughtful consideration, they can also water down the clarity of an organization’s market positioning, and progressively erase its uniqueness and differentiation.

It is therefore essential for both leaders and employees to remain crystal-clear about their market differentiation, and to execute accordingly. If widespread use of best practices by other players leads them to catch up on an organization’s market position, it is the leadership team’s duty to develop distinctive execution advantages that re-establish its lead. For example, even an organization competing on cost, like microelectronics, may still be fiercely innovative to apply innovations to its quest for continued cost reductions.

The bottom line is leaders should distinguish between best practices – that level the playing field but may erode their unique positioning – and right practices – that are well-suited to the particular market positioning of an organization. Right practices will balance the delivery of best-in-class performance with tight alignment, singular positioning, and value proposition.

In our next blog, we will focus on the importance of having Balanced Metrics.

How well is your business executing? To find out, please reach out to us info@kinseymgmt.com and we will initiate an assessment of your execution capabilities.

Lisa Kinsey

Lisa Kinsey

Lisa Kinsey’s expertise lies in organizational strategy, culture change, project alignment and execution. She has been on the forefront of change and transformed businesses and cultures through people-focused strategies. Lisa has held numerous leadership positions with Fortune 500 companies that spans from sales and operations to HR and organizational development. She is passionate about sharing her experiences, successes and lessons learned with her clients, helping them breakthrough to the next level of performance.

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