By Stephen Archer, Director, Spring Partnerships
Many business owners seem resigned to their fate at present complaining that the recession is responsible for the current poor state of their business. But surely, this is a bit like complaining that you are wet because it’s raining. How about wearing a raincoat? The actual raincoat for business however, is not defence; it is to attack.
Sun Tzu in the 6th century said that you may survive through defence but you can only win by attacking. One of the strangest paradoxes of the business world is how many business owners don’t see their own situation as being competitive. This is absurd as competition in so many forms is ever present and can never be ignored.
So what can businesses do to be more effective through competitive behaviour?
• Firstly, you must know what your customers want and know even more about what your competitors are offering and how they behave. Competitors of all kinds are the minimum benchmark for which to aim. Equalling the value of competitive offerings is rarely going to suffice — always ensure you are moving to stay ahead:
• Continue to develop your products and services. Never stand still. Even those lucky enough to have patent or intellectual property protection must seek to acquire more advantages. If in any doubt about this then compare the fortunes of General Motors to Toyota.
• Make the customer the central focus for the business. The customer with their money is central to business success; so do not rush to copy competitor’s ways of caring for customers (e.g. automated telephone services). Develop new ways to engage with customers in a way that to customers want. They will repay you over and over. This is how Virgin Atlantic took so much business away from the likes of British Airways.
• Make every customer your friend and endorser. The cheapest marketing is done by customers. If they love your product and service enough then they will build your reputation for you — at the expense of your competitors. If they love your competitor but your products and services are better then get people to trial you. This is the road to customer conquests.
• Assume that competitors will always develop new products or services r ways of doing business. Just as you should be trying to outsmart your competition at every turn, assume at all times that the competition is trying to do the same. So complacency is the big bad ‘C’ word here.
• Assume that competitors will steal your ideas — so be willing to steal theirs where appropriate. Copy best practice. Sometimes copying is the best route. However, copy it, and then improve it. Look at how the Japanese destroyed the UK motor cycle industry.
• Assume that your business could be killed off by new entrants to the market or new innovations — people or technology based. This is all about the unthinkable.
Be prepared for competitors arriving with disruptive innovations. When they arrive you will have to move very quickly and decisively. Consider how MP3 has affected CD sales and do you remember cassette tapes?
• Look forward, not back. By all means look at your competitors but look to the future to bring your own disruptive innovations and competitive advantages. In the end, competitiveness is a state of mind. Acquire it if you have not done so already. It will be the hanger for your raincoat.
Find out more at: www.spring-partnerships.com