In a path breaking analysis, Derek Abell managed to develop a business definition framework in 1980 that defined business along three dimensions. They included (1) customer groups, which relates to ‘who’ is being satisfied; (2) customer needs, which looks at ‘what’ is being satisfied; and (3) alternative technologies, which looks at ‘how’ the company satisfies the needs of their customer (Zhuplev, 2018). The path breaking analysis is what is referred to as Abell’s three-dimensional business-definition model. According to Abell, strategic planning processes of businesses start with mission statements. The mission statement will give the organization direction and also provides them with a basis for further strategy elaborations. As such, they need to have all the three elements as integral parts of the organization. As we know, customers are major stakeholders to any business organization. Therefore, the organizations need to meet their customers’ needs because they are the major players of their business. They are the major determinants of a company’s success and or failure. In addition, business strategies for organizations need to also consider the three elements because it will help them in maximizing the advantages gleaned from it (Zhuplev, 2018). For Abell, these three elements are what drive organizations meaning that after careful consideration, the mission can be derived from the business model. Later, a strategy is then developed based on the business model identified.
Using Abell’s approach when it comes to defining business is significant because it is a marketing- and customer-oriented approach and not a product-oriented approach (Zhuplev, 2018). Opting to use the model will result in the organization going through various processes. This helps them to determine the offshoots that can be spawned from using the organizational expertise, skills, human resource, and technology plus other organizational strengths. The model can be used in analyzing the scope of business operations and includes areas such as products and technologies. The current businesses activities can be analyzed using the three-dimensional business definition model and later create strategies for the future. This analysis helps the business to stay tuned to market changes. The framework helps business define their competitive scope and extent of their competitive differentiation with regard to their products and or services (Zhuplev, 2018).
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Using Abell’s model, Reader’s Digest Association has managed to identify their customer group, which are families (Furrer, 2010). Therefore, they can offer them additional products that will be sent down the distribution channel. Through this, the association can opt to design magazines for their customer group by touching on issues affecting modern families. By so doing, Reader’s Digest would be creating more value to their consumer group of people because they will help them maneuver through their daily lives with little stress. Knowledge is power and by sharing with the different families such knowledge, they will be adding value to these groups of people. Moreover, Reader’s Digest could consider giving their consumer group coupons to touch the lives of their most loyal consumers. The coupons will give these customers discounts for the products and services they use. Considering the high cost of life for most families, the coupons will help them in maintaining their subscriptions of the Reader’s Digest Magazines. Therefore, the company will be maintaining their old customers and attracting new and potential customers. Such gestures are a form of appreciation that goes a long way in maintaining a positive relationship with your target market and consumers. Looking at Abell’s model, it is evident that it ascertains the needs of their consumers and manages to identify with them and fulfill them (Furrer, 2010). These efforts see businesses have loyal customers when it comes to using their products and services. By appreciating customers, the organization is motivating them further to continue using their products.
References
Furrer, O. (2010). Corporate level strategy: Theory and applications . London, UK: Routledge
Zhuplev, A. V. (2018). Disruptive technologies for business development and strategic advantage. Hershey PA, USA: IGI Global.
