The biggest single gap in the business system of firms we see today is the lack of a mature marketing process or function. In the absence of a marketing function, or one which is only minimally present, a firm is flying blind – it does not know the marketplace and its needs, either now or in the future.
Despite this glaring gap in their systems, many firms pursue improvement as if this gap did not exist – they focus on improving operational processes, usually to drive costs down, or achieve better performance in some critical-to-customer-satisfaction dimension such as delivery performance or quality. The focus of these firms is on doing what they already do, better.
Yet, doing things better is only half the story. If those things are not the right things, then making them better is only a partial answer at best.
In the absence of a marketing function, it is hard for a firm to know what the right things are. What is the unique value that is needed by the marketplace, both now and in the future, and what are the capabilities and processes that are needed to supply this differentiated value? These are the key questions that only a mature marketing function can answer. Marketing is a business development process, not an operational one, and as such is the key process in the business which creates customers.
Differentiation is a strategic concept, not a tactical one. Differentiation implies that a firm will do things that are uniquely different from other competitors. Only marketing can supply the answers to what the sources of a firm’s uniqueness will be.
To differentiate effectively, a firm must innovate. This is implied in the definition of “differentiation” – if something is uniquely different, then it has not been done before, by any competitor. Innovation drives differentiation. Firms that have no capacity or capability to innovate are not likely to successfully differentiate themselves.
Marketing is the necessary precursor to innovation. It is marketing that guides innovation and ensures its accuracy, whether it be innovation of products and services, or innovation of capabilities and processes. A firm which lacks a mature marketing function is incapable of innovating accurately.
Closing the gap of a missing or immature marketing process is not just a question of adding resources. It is a question of risk mitigation. Supplying missing resources is only one way to close a system gap. Every firm that has a missing or immature marketing process must address how they will mitigate to their business by not having this key function effectively present.