From Crisis to Opportunity

Do you know that the biggest ideas and companies around the world became by transforming risks to opportunity?

This article is ARK’s series of articles that are focused to help leaders in understanding risk management & business continuity management purposes, which helps in better decision making bringing the knowledge from some of the world-class cases about management strategies and leadership styles in time of disruptions, crisis, losses or disasters.?

From crisis to opportunity- ''In favor of clients''

IBM, the leader in computer industry, had recorded the biggest annual loss in the history of economy of $8,1 million.

In the April of 1993, Louis Gerstner, has been appointed as CEO of IBM. One of his first tasks has been not to complete strategy of his predecessor which is not to divide IBM into units. Instead of it, he has decided to preserve IBM as a whole and from the company’s wide range of the products, services and skills, create the most powerful advantages in the market.?One of most efficient decision of new orientation of IBM has been Gerstner’s the determination to focus the organization uncompromisingly on the needs of customers and their interests, which represented the only real determinant of success and that has become reason for successful return on the market (“in other words reason for business continuity”).?

His ambitious rehabilitation program, which was initially marked by cost reduction, represented a basic strategic reorientation, at the center of which was an orientation towards the provision of services as well as a focus on the Internet. Huge investments in the field of R&D were a clear indication that IBM really cared about being oriented towards customers and that it is the center of attention of the management as well as the CEO himself.

That's why one of Gerstner's biggest achievements was that he reminded the IBM company again that it is IBM. You can also find it in his book: "Who says that elephants can't dance?", which we warmly recommend being read.

The only valid definition of the purpose of existence of a company is to have satisfied customers. Customer is the base on which everything is built, including the existence and growth of the company, including employment.

Reinhold Wurth described this connection best: "My people don't work for me, but for the customers".

So, the questions you should start with:

1. What is the benefit for my customer? This question is rarely asked, mainly because leaders rarely ask it, assuming that the answer is clear. But the answer that will be heard more often is more wrong. Leaders should not try to guess, but should come to a sustainable answer through analysis, by systematically talking to customers and at the same time observing what they really buy, because it is often the case that customers claim one thing and do another.

Gerstner could only achieve his goal of creating a company that was obsessed with the idea of working for the benefit of customers by "looking at technology through the eyes of the customer". This required the most intensive dealing with the customer's problems and wishes.

In essence, the customer never buys a product, but the benefit he gets from that product or service. It is important that this benefit is understood, and not only for the sake of better marketing or the introduction of innovations, but for the sake of better decision-making, which activities or production decisions can be changed and thereby save the company.

In addition, it is becoming more and more important to consider what is needed by those who are not yet customers?

Even when an organization has a dominant position on the market, as what was the case with IBM, there is another huge part of the market that that company has not conquered, which, could be both an opportunity and a danger if not tackled timely.

For example, companies with a 30% market share represent a top managerial achievement, but still 70% of customers buy from someone else. Why? What do these other customers find useful? How to understand their needs?

This is the exactly the essence of understanding the concepts of #businesscontinuity and #riskmanagement. Business sustainability through customer satisfaction and constant sustainability of market participation.

Gerstner hit the spot with his statement: "IBM is a solutions company. We start with the customer's problems and from there we develop the right combination of technology and expertise''.

• What benefit does the customer/client see in you?
• What can you do to understand him better?
• What is useful for those who are not yet your clients?
• What will you do to understand them more?
• What results do you expect in the next three months and next year in terms of business continuity, risks & your customer sustainability?