Massachusetts Legal Blog

The “Outside-In” Approach to Your Business – Business Law Massachusetts

 An “outside-in” perspective is premised on the idea that dependably successful companies begin with an external market orientation, whereby utilizing customer trends to design their business strategy. In more simple terms, this approach aims to deliver, above all else, something of value to customers, in lieu of simply developing a product.

Times are difficult for many businesses, yet some consistently thrive. Starbucks, Target and Cisco, to name a few, remain resilient during turbulent markets. These Corporations pride themselves on their customer-centric approach. In doing so, they remain titans in their respective industries.

Some of the challenges faced by businesses are perennial – finding customers, securing investment, hiring the correct people – but it is important to remember that success is very much a product of customer satisfaction. With the involvement of technology in essentially all aspects of life, it is important not to forget we are humans, interfacing with other humans.

A seemingly simple illustration of the benefits of the “outside-in” perspective is bagged salad. Bagged salad has risen to be a $2.5 billion-a-year industry. Yes, chopped lettuce is an astoundingly profitable business, and will likely remain so into the foreseeable future. Companies, such as Fresh Express, realized the busy consumer not only wants to purchase salad, they want companies to make the salad for them!

In a similar fashion, Best Buy profited, immensely, from “outside-in” thinking. During an era where computer manufacturers were dropping costs and cutting back services, Best Buy launched Geek Squad. Geek Squad addressed the consumer demands for home and business computer support. Best Buy intelligently assessed the market from a customer’s point of view, not a product-first perspective. They even broadened their footprint into installation of equipment. Perhaps this explains why Best Buy is still in existence, while its main competitor, Circuit City, no longer has a pulse.

Toyota is an excellent example of a company who fell victim to the fruits of the short-term shareholder gains through the internally focused “inside-out” strategy. A once commendably successful company, Toyota shifted their goal from meeting customer needs, to superseding General Motors and maximizing growth. Naturally, the quality of their vehicles suffered resulting in a significant loss of revenue and a shrink in their customer base.

Professor of Business Administration at Harvard Business School, Ranjay Gulati states:

“The role of employees is absolutely critical as companies strive for an outside-in perspective. If the organization does not have people who can explore, comprehend, and meet its customers’ needs, the pursuit of customer-centricity is doomed from the start. To me, a key distinction for managers to focus on is the one between coordination and cooperation.”

In essence, employee and office fluidity and camaraderie are essential for success and allows a business to focus their efforts on profit-making strategies.

Here at Shapiro Law Group, we can assess your business needs and assist you in drafting or modifying employee and office manuals, including a wide variety of related documents. Comprehensive, modern and legally sound employee and office manuals will allow you to reach your business goals in a more efficient and systematized fashion. A business with employees who are working in unity can then, comfortably, shift their efforts towards meeting the needs of their customers.