How in-tune are you with the key market forces that impact the performance of your organization? Your ability to help identify these market forces, the potential strategic and operating challenges (and opportunities) they present, and an offensive or defensive human resource development plan that both incorporates them and supports the business strategy will certainly strengthen your role as a value-added business partner.
Although a variety of market forces may need to be addressed by your organization, there are three common ones that affect businesses today: customer responsiveness, information demand and cost pressure.
Quickness in anticipating and responding to customer demands will continue to be an important ingredient of competitive advantage. Even today, many organizations are eager to collect your payments for the purchase of products or services, but when it comes to returning those products or terminating those services, they make it a challenge to receive a refund—sometimes requiring extensive submissions of paperwork, long delays to receive a check back by mail or limiting the return/refund period to a short timeframe. How do these approaches and policies affect your prospect of getting repeat business from these customers?
Similarly, in many organizations, front-line service delivery employees are still not allowed to make decisions or approve certain transactions that will enable them to resolve and satisfy the customer’s issue on the spot (if in person) or on first contact (if on the phone). Instead, these organizations choose to continue to irritate customers by requiring them to work their way through multiple reviews and decision-makers in order to get a resolution.
Addressing this market force goes well beyond service management training. Increasing emphasis on customer responsiveness requires that an organization’s structure and operating practices evolve so that quick response, variety, convenience, proactive identification and understanding of customer requirements, and flexibility are enabled throughout the organization.
The ability to remain competitive will depend on its ability to capture and deploy customer-, market- and industry-specific information to targeted points in its workforce. Although CLOs do not always have a strategic leadership role in selecting the technology required to support the organization’s performance needs, it is critical that CLOs take an active leadership role to help identify and define the information needs of employees so they can perform effectively on the job. This includes defining not only what information may be needed, but also when it’s required and how information should be gathered from employees and fed into the organization’s knowledge management information base.
Increasing emphasis on information demand requires that leaders at all levels help expand information and communication technology capabilities, as well as ensure that information is made available to those who need it on a timely basis. With an increased understanding of information needs, CLOs also will be able to define the competencies required at all levels to improve performance on the job.
As a wider variety of global competitors continue to flood the marketplace, the pressures to remain cost-competitive will place even greater demands on organizations and their employees to work smarter and faster. CLOs are challenged to partner with and convince the executive leadership team to not reduce investments in human resource development even during cost-containment periods.
Increasing emphasis on cost pressure also requires that leaders identify and sponsor targeted global transformation and process improvement efforts to help enhance efficiency and productivity. This will require a great deal of partnering with senior leaders across the organization, helping them incorporate these priorities into their development and operating plans.
Clearly, taking the lead to ensure that your organization is fully prepared to address the key market forces impacting organizational performance today and in the future will strengthen your position as a strategic business leader.
Richard Y. Chang, Ph.D., is founder and CEO of Richard Chang Associates, and is author of “The Passion Plan.” He can be reached at rchang@clomedia.com.
FAQs
According to the study, the factors that influence performance in the organization are external environmental factors, working conditions, organizational culture, organizational assets, HR management, organizational structure, political, economic, and technological factors, as well as leadership.
How do market forces affect Organisations? ›
By influencing the price and quantity of goods and services, market forces can affect the profitability of businesses within the industry and the level of output within an industry or economy.
What are the 4 market forces? ›
There are four major factors that cause both long-term trends and short-term fluctuations. These factors are government, international transactions, speculation and expectation, and supply and demand.
What are the three market forces that impact business? ›
Although a variety of market forces may need to be addressed by your organization, there are three common ones that affect businesses today: customer responsiveness, information demand and cost pressure.
What is the market performance of an organization? ›
The performance of a firm which can be measured through sales revenue, market share, profitability, competitive advantage, customer satisfaction and loyalty.
What are the key factors affecting performance? ›
Communication and collaboration – These are two key factors associated with employee productivity at the workplace. A constant flow of communication is necessary to keep teams updated, informed, and engaged. Lack of communication results in silos, therefore reducing employee productivity.
How many forces are there that impact the organization in the market place? ›
Key Takeaways
The five forces are competition, the threat of new entrants to the industry, supplier bargaining power, customer bargaining power, and the ability of customers to find substitutes for the sector's products.
How does marketing affect an organization? ›
The importance of marketing for your business is that it makes the customers aware of your products or services, engages them, and helps them make the buying decision. Furthermore, a marketing plan, a part of your business plan helps in creating and maintaining demand, relevance, reputation, competition, etc.
Why are market forces important? ›
Market forces determine the price and quantity of a good or service in a market. Market forces occur naturally in a free market economy and are controlled by government intervention. An example of market force acting is when the price of crude oil increases when there are shortages in the supply.
What are the two main market forces? ›
Demand and supply are the two major market forces we shall study. The “place” where consumers (i.e. buyers) and producers (i.e. sellers) meet is called a market. A market is any organized setting that enables the interaction between buyers and sellers of a good/service.
The MFF is a percentage of the national price. As the national price is based on total running costs per unit of activity the MFF must reflect all components of costs that drive this price.
What are the 4 factor markets? ›
Land, labour, capital, and entrepreneurship markets are examples of factor markets. Factor markets have a supply side and a demand side.
What are three market forces that impact business quizlet? ›
The market forces include supply and demand, the profit motive, and competition.
What are the three market factors? ›
A market economy can't exist without three interdependent components: the factor market at one end, the goods and services market at the other end, and, in between, the producers—the companies that create the products we use.
What are the three major forces of the economy? ›
Economic forces
- Unemployment level.
- Inflation rate.
- Fiscal policies.
- Government changes.
Although many things can affect the choice of an appropriate structure for an organization, the following five factors are the most common: size, life cycle, strategy, environment, and technology.
What are the 4 factors of performance? ›
The four identified factors are: mental, emotional, social, and physical. This table below provides examples of each of the four factors and how they may impact on performance before, during and after physical activity.
Which is an important factor that determines the performance of an organization? ›
Human factor is the most important factor, as organizational performance is greatly influenced by the strategic use of human resource, which must be developed for creating competitive advantage through innovations in product, process and technology, thereby improving organizational performance.
What are the factors influencing organizational effectiveness? ›
Therefore, we can say that organizational effectiveness encompasses various factors such as clear vision and goals, strong leadership, strategic planning, efficient resource management, effective communication, talent management, performance measurement, adaptability, and stakeholder engagement.
