Relevance and importance

The more clearly customer needs are understood, the more clearly change can be planned. Accurately assessing market and customer needs will give tremendous insight into the potential opportunities your company can address. The information and knowledge gained can be used as an input to set priorities, make improvements and drive activities in the organisation. It may be crucial for the SME to collaborate with technology partners, either as a recipient or provider of technology, in order to fulfil the perceived customer need.

Overview

Before a company can target a specific market it must first define it. Once the organisation has defined the target market, i.e. it can accurately describe the characteristics of the individuals or companies it intends to target, it can then go on to identify the specific needs of this market.

For example:

	What is the most important need within your industry?
	What is the most important need for your customers?
	What is the most important need of the individuals who buy your products and services or make the decisions to buy them?
	Focus on customer needs not just customer satisfaction issues.
	Focus on uncovering the specific problems of your prospective customers instead of the symptoms of these problems.

Assuming the SME cannot fulfil all the market requirements alone, it will hope to address the market needs through one of two ways:

1. Outward technology provision - By taking its products and services to a collaboration partner with whom they can satisfy the client requirements.
2. Inward technology acquisition - By choosing a collaboration partner who can bring the necessary technology to the company and thus increasing capability so as to be able to meet the client needs jointly.

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Recommendations and practical tips

There are a number of different types and combinations of research methodologies designed to identify and analyse market needs. The techniques used depend on the organisation, types of products and services, and evolution of the organisation. Nevertheless data quality, direct and indirect costs, and timeframe should always be considered.

Some common methods:

	Sales force opinion
	Customer survey
	Expert opinion (e.g. dealers, distributors, suppliers, consultants, trade associations)
	Test marketing
	Leading indicators- other factors which may give advance wanrning of changes in your industry.

In assessing potential inward/outward technology collaboration one should consider:

	Staff parameters, including number of staff and expertise
	The organisation's ability to adapt to change
	The nature and quality of activities of your collaboration partner.

Warnings and potential pitfalls

	Sales force opinion may be biased.
	The information gained needs to be relevant, properly assessed and evaluated to provide useful knowledge.
	When determining target market needs, there is no substitute for quality research. Badly designed or poorly executed research could lead to costly misjudgements.
	Technology and the needs of the market can change rapidly. Consider how sustainable your solution is going to be. Continually assess market needs and be prepared to respond to them to avoid being overtaken by competitors.

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