Trend: From Silo to Integrated

Since the industrial revolution, the number of products and services entering the market has increased exponentially. Innovations have enhanced our lives in many ways, yet they have also added huge complexity for people to navigate.

If you look at product categories, they have all been added to over the last 100 years.

Using Olympic sports as an example with thanks to Wikipedia! The 1904 Olympics were in St. Louis, Missouri. This was the first time the games were held outside of Europe. The games in those days ran over an extended period from July to November.  There were 16 sports and 17 disciplines, 95 events with 12 Nations attending and 661 athletes (645 men, 6 women).

If you were a sports enthusiast able to attend the games, you had the opportunity to go and see every event on offer, as fewer events ran over a longer period. There was no TV or radio in those days, so the only way to experience the games, if not there in person, was through newspaper reports after the fact.

At the 2020 Tokyo Summer Olympics, the number of sports doubled and tripled to 33, with 339 events. The games were held over two weeks instead of five months and multiple events could be viewed through different mediums. There is now so much sport that it would take months of viewing to watch it all, so now we have to choose what and how much we watch.

Now while double and triple doesn't sound like a lot in hundred years, add in all the other sporting categories and events within those categories (ball and stick sport, winter sports, football codes, bike riding, motor racing, sailing etc.) and multiply them out, and we see a huge amount of new sports and events to be consumed. It's impossible to view even a small percentage in a lifetime of viewing.

In every industry sector, the change and growth of both the categories and the number of brands operating in each category have added complexity to the consumer decisions.

If you look at your industry, it's a fun exercise to go back into history to see what it used to be and what it is today. What we see is so much complexity, and consumers are often baffled as to what choices to make.

 Businesses that successfully integrate their offer in the future will attract the greatest amount of market share.

What I see in today's world is businesses putting multiple offers under one brand; however, in most cases, the integration is not there.

In the marketing industry, to simplify the explosion of products, we went through a positioning era through the 1990s, articulated in the book, 'Positioning: The  Battle for Your Mind', by Al Ries and Jack Trout. This go-to-market technique served the market well and was instrumental in the Lexus strategy of entering the US market and capturing a huge market share in a relatively short time. This was in a crowded market where the luxury market was predominantly the domain of Mercedes and BMW.  As a result, Lexus shifted from a product positioning to a service positioning, opening up a new type of customer offer in the category.

We are now in a new era where integration is a key trend as people continue to want things to be 'simple' to make the purchases they need to improve and enrich their lives.

What is integration?

Integration is a higher-level problem that the collective consumers/customers have that they simply want to be solved.

Example:  In real estate, we need, on occasion, to move house because our circumstances change through our evolution of life.

In today's world, when we make this decision, we then have to go about looking for a new house, getting our current home ready for sale and then following through on all the various transactions that this creates. If you add up all the people and transactions that need to occur, you will see that over 30 people and businesses need to be engaged. For this reason, many people say that moving house is one of the most stressful events in life.

How will integration help? 

There are businesses out in the market now that are looking to integrate services and offer project management of processes on behalf of the customer. The businesses that do this well will provide this service at a cost that is no greater than what it is today. They will be able to systemise and automate various aspects, and they will be able to take the stress away from the customer so they can get on with their work and life.

This type of integration is possible in every aspect of business and life.

Is integration simple?  No.

Businesses have been trying to integrate service offerings for many years. Still, many have been unsuccessful in creating an offer that benefits the consumer enough to take up all aspects.

An example: In the professional service world, you will see brands in the market that offer every type of service; accounting and compliance, insurance, banking services, business strategy, audits, estate planning etc. The consumer's issue with these services is that although they are under one brand, they still operate in a silo construct. If you ask the majority of customers whether they use a firm for every aspect of their business growth, the answer will, in the vast majority, be no.

This fact applies to almost every industry sector, except where the integration has been completed, where it has taken away consumer choice by capturing a key component of the supply chain or integrating a whole supply chain to dominate the market from supply rather than demand. I'm referencing here that demand-led industry sectors need to integrate from the consumer perspective and not supply.

If you look at your circumstance, look at your financial relationship matrix from banking to accounting and financial services. Do the exercise and add up how many different brands and organisations you work with. If you look at this as just one aspect of life, you can see the complexity in this one area. Now look at this from a health perspective, a sports perspective, an education perspective, a food choice perspective, and you will start to see the layering of complexity.

Why does integration fail to meet expectations?

Reason #1: The majority of people and brands within the system are profit-led. This means they have targets and budgets to meet in their individual silo. This results in a pattern of behaviour focused on the business and not the customer's total needs. Businesses will argue with me on this one, saying they are customer-focused, which they are, but it's for what they offer instead of the customer's complete needs, which leads to reason #2.

Reason#2: Not operating from a high enough context when viewing the customer's needs. When a business lifts its context to view it from a higher perspective, they can see that there is a greater need to be met.

Reason#3: If a business sees this need, unless they are extremely well funded, they find it hard to imagine how they could ever possibly meet that need due to all the components that need to be integrated. In other words, the complexity even overcomes those providing the services in that sector.

How is this going to change and integration become a reality?

The key is the structure and approach of the various businesses. Over the next ten years, we will see businesses come together to solve the various problems of complexity. However, in coming together, they need to do it under a new construct, being community-led.  

The new era of business is online and offline communities. How these communities are put together will be the key to successfully integrating services. 

It's an exciting time for businesses and entrepreneurs to form a new way of working together to benefit the consumer, our community, our societies, and the world to drive change and growth.


Tim Dwyer is a business growth expert specialising in helping businesses strategically grow their assets, increase their business value, and improve their capabilities.

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