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 A Framework that Stands the Test of Time
Each year, hundreds if not thousands of business books hit the shelves. Not all fare well over time. Nearly 15 years after first being published, `The Discipline of Market Leaders' holds up nicely.
The premise of the book is straightforward - in order to succeed, companies must effectively deliver their value propositions to the markets they serve. The authors suggest there are three such approaches or `value disciplines' that a company can pursue: operational efficiency, product leadership, or customer intimacy. Most importantly, Treacy and Wiersema make the case that companies must fully commit to one of the three disciplines in order to build and sustain market leadership. Failure to do so (even if a company is proficient at all three) will ultimately result in failure.
Though some of the (formerly) stalwart admirees seem a bit ironic now (Sony, Silicon Graphics) the framework presented is useful for analyzing both the way companies attack their markets and potential avenues of competitive attack. For example, Wal-Mart delivers price leadership (a facet of operational efficiency) by ruthlessly managing costs from their supply chain. Potential competitors needn't bother competing with Wal-Mart on the basis of superior logistics. However, a company might successfully do so by pursuing a customer intimacy strategy with such offerings as personal shoppers and childcare.
Another unmistakeable observation is that `Disciplines...' predates the era of the internet. Despite the absolute transformative impact of the web, the framework still can be useful in making sense of current darlings Google, SalesForce.com, LinkedIn, and Facebook.
Treacy and Wiersema are not prescriptive in terms of which discipline a company should pursue, but it does seem that there are some natural pairings. A company that delivers cost containment might itself be most consistent by pursuing a discipline of operational efficiency. A company that delivers a luxury experience might best be served by a path of customer intimacy. And likewise, it seems natural that certain marketing vehicles most closely fit a given value discipline. A company that values operational efficiency might naturally gravitate to efficient vehicles such as PPC and other online marketing avenues. The luxury brand might best be served through a high touch referral marketing program.
In short, `The Discipline of Market Leaders' gets it right - a relatively quick, intuitive read that leaves you armed with a novel approach to both strategy and analysis. Recommended reading.
 Great for adding focus to your business strategy
A quick but detailed discussion of the need for and elements of a focused approach to the market. The book provides a good overview of three primary strategic approaches, and then devotes specific chapters to detailed analysis of each with examples. A must read for business leaders involved in marketing or product development.
A must buy for any atrategy development
A lot of management books are focused on the coporate scene that it is refreshing when something like this comes along. The advise is sound and can readily be applied even to small and medium enterprises as well as entrepreneurs.
A must read for anyone who is involved in the development of strategies, for companies big and small.
Discipline is the key word
These days far too many companies try to excel at everything and therefore excel at nothing. In this book, the authors propose the theory that successful companies focus on one of the following:
1. Operation Excellence - competing on the lowest total cost
2. Product Leadership - competing on the best product
3. Customer Intimacy - competing on best helping customers
Many good lessons can be learned from the companies highlighted. While the need for focus is made clear, several of the examples appear to show that a company can have a secondary focus (always overruled when it contradicts the primary, but otherwise dominant).
After presenting the disciplines, the authors go on to describe how to choose through a great hypothetical case, and then how all the disciplines are different aspects of serving customers. While that may appear to contradict the main theory, it doesn't because different customers have different preferences, and if a company doesn't excel at one of them, customers will flock to competitors who excel in the area they care most about.
The book is well written with enough humor to keep it lively. For an example, after describing how Nabisco, once a product leadership company, began reducing quality of its Chips Ahoy cookies to reduce cost- "Ahoy Nabisco. Your customers won't need MBAs to taste the difference."
Operational Excellence, Product Leadership, or Customer Intimacy?
This is a classic business strategy book with a simple and useful model. The book states that you need to choose one of three strategies: Operational Excellence, Product Leadership, or Customer Intimacy. Each choice requires different competencies:
OPERATIONAL EXCELLENCE
Cost reduction is key for this discipline. It requires a culture of teamwork and conformance to standards. These organizations are typically centralized with command and control structures. Examples: AT&T, Manufacturing Firms.
PRODUCT LEADERSHIP
Innovation is key for this discipline, made possible by a talented team that can collaborate. These firms are good at exploring new markets, inventing, and commercialization. Examples: Proctor & Gamble, Apple.
CUSTOMER INTIMACY
Solving customers' problems is the key for this discipline. Employees work in teams to create custom solutions. Examples: Airborne Express, Advertising Agencies.
This book is well conceived and well written with an intuitively compelling premise. The examples are a bit out of date, but it is well worth the read.
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(based on 32 reviews)
