What Are Business Drivers?

Mary McMahon

Business drivers are factors that direct business objectives and assist with the achievement of business goals. These can cover a wide range, from the customers who create the demand for given products to the shipping department responsible for order fulfillment. Identification of business drivers can be an important part of business planning and coordinating, as this may help businesses determine where to direct their focus. Drivers can operate on a specific business, or within an industry as a whole, depending on their nature.

Identification of business drivers can be an important part of business planning and coordinating.
Identification of business drivers can be an important part of business planning and coordinating.

Some business drivers are internal. They are the personnel and departments within a company that contribute to product development, marketing, production, and sales. Sales forces, for example, create a market for a product and work to make sure products and services are delivered in a timely fashion. These internal drivers support the work of a company and may have a common objective in mind, such as the desire to corner a set percentage of the market for a specific product.

External drivers include factors like customers and regulatory agencies. Customers can dictate not just behavior at a business, but across an industry, with demands for specific products and services. They may expect certain features, for example, which members of the industry will need to enable to build and maintain customer relationships. Regulators may influence industries and companies with rules that force them to adapt and change business practices to stay within the law.

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Companies with clearly identified objectives can also find their business drivers, the factors that shape and achieve those objectives. They can also rank drivers by level of influence, which may help them find groups that slip through the cracks. For example, a little-known department might actually play a key role in delivering a company's product or service. Investing in that department could result in better returns for the business as a whole. Likewise, a previously unrecognized group of customers might emerge as a more prominent demographic and business driver, with careful analysis.

Failure to respond to business drivers can put a company at a disadvantage. The management may not be able to anticipate market shifts, which would leave them with outdated products and services and no interested customers. Within a company, drivers might become frustrated with working conditions, which could result in less productivity and efficiency. This might lead to lags in product quality and a decline in customer demand that might harm a company's bottom line.

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Discussion Comments

Certlerant

Although all departments and a variety of factors may be important to the identification and utilization of business drivers, as the article indicates, the most important factor has to be marketing.

A good marketing department within a company has its finger on the pulse of the consumer mindset and is able to adapt to changes in the marketplace.

For example, market research would show if a more health conscious society is buying wheat and whole grain breads instead of traditional white bread. This shift in consumer preference alone can drive the future of a bread manufacturer's business model.

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