No Line of Business Is An Island

Let me state the obvious; no line of business can survive long without partnering with the other lines of business.

Now what do I mean? I am talking about more than just good lines of communications; I am talking about a symbiotic relationship across LOB or divisional lines.

From my perspective there are three primary drivers to developing this type of relationship models. They are customer/client focus, profitability and the ability to stay focused on the corporate strategic direction.

Customer/client Focus

Today’s customer does not distinguish between the different lines of business or product lines within a single company. In this fast paced instant access world, it is more crucial that companies understand and relate to their customer base as a single point of contact. While many companies have made their web sites into a single portal, many have yet to apply the same principle to their distribution and service channels. For a pulse of the behavior of customers, one only needs to look at web usage.

Profitability

By leveraging information, human resources and technology between LOB, not only can expenses be optimized, but cross-selling opportunities should enhance. An example of the leveraging of information and technology is the Customer Relationship Management or CRM. By utilizing a single CRM system, not only can costs be optimized, but all customer information is in a single database. By having a centralized view of the customer, sales opportunities can be maximized.

Corporate Strategic Focus

Corporate strategic directions can and many times are not the focus of a line of business. There is nothing surprising here as most short term incentive programs by definition are not strategic. By developing deep and lasting relationships with the other units or LOBs and by sharing appropriate resources, a natural system of checks and balances can be developed. In the case of technology, competing priorities can be minimized when the LOBs are in one accord.

Rick Hart