Are you competing to be the best company in whatever vertical market you are operating in? The best software company; the best manufacturer or distributor? How about the best CPA, Legal, or Consulting firm? With 13,000 new companies starting up each week, how can you say you are the best?
Rather than thinking of your product or service as the ‘best’, consider how it is uncommonly or uniquely different from your competitors. Strategy is all about being different. In his classic book 'Competitive Advantage', author Michael Porter defines strategy as the “creation of a unique and valuable position, involving a different set of activities (from competitors)”. If we cannot clearly define how our offering is unique or uncommon, then, as a leadership team, we need to discover, understand and articulate what makes our offering uncommonly different from our competitors.
So, what can we do about it? Here's what I think:
Understand your core competencies. Develop competencies that your competition will be hard-pressed to duplicate.
Define your core customer, your WHO. Think of your core customer as a real person who exists and is working in a company already in your database, and with whom you find it a pleasure to do business and who buys at a profitable level.
Discover your 'Uncommon Offering.' Determine WHAT you are providing for your ideal 'WHO'. (Hint… it satisfies both transactional and emotional needs).
Define your 'Imaginative Acts', your STRATEGIC DIFFERENTIATORS, things you are doing that are not being done well or at all by your competitors.
Discover your X Factor, your Secret Sauce, the big differentiating secret that only you and your team know about and leverage it to greater levels of profit and increased enterprise value.
Below you'll find a series of resources if you want to dive deeper into understanding the problem.
ARTICLE: Core Competencies, Bain & Company. [12 min read]
Defines Core Competency as follows: A Core Competency is a deep proficiency that enables a company to deliver unique value to customers. Such a Core Competence…
1). Creates sustainable competitive advantage for a company
2). Helps it branch into a wide variety of related markets
The litmus test for a Core Competency? … It’s hard for competitors to copy or procure.
Understanding Core Competencies allows companies to invest in the strengths that differentiate them, set strategies that unify their entire organization, and leverage their strengths to profitable advantage.
VIDEO: Core Customer Component of The 3HAG Way. 3HAG pt. 4 - Core Customer: who will buy at a profit [3.12 min watch]
As a practicing 3HAG WAY coach, I strongly support author and coach Shannon Susko's approach to defining Core Customer, which is a critical component in her 3HAG Way Strategic Execution System. Susko's Core Customer exercise is derived both from her own experience as a CEO, and also adapted from 'The Inside Advantage', by Bob Bloom, referenced below.
BOOK: Inside Advantage, by Robert Bloom.
Southwest Airlines was launched in 1970 in Bob Bloom's conference room in Dallas, Tx. Working with some of the world's most famous brands, such as L'ORÉAL, Perrier, BMW, Southwest Airlines, and Nestlé, Bloom developed an effective guide to help you discover your Core Customer, (WHO), then your Uncommon Offering (WHAT), then your Imaginative Acts, (STRATEGIC DIFFERENTIATORS) and finally your 'Inside Advantage’. Pulling it all together in ‘Inside Advantage’, the author demonstrates HOW to sell your WHAT to your WHO, at very high levels of profit.
Excerpt: “I believe that a flourishing business should double in size every 5 years. It's an ambitious goal, but at the same time a reasonable measure of an aggressively managed firm firing on all cylinders, on track to reach its full potential.”
Self-inquiry questions to consider:
Do you know how your product or service is differentiated in your market space?
Do you know your core customer down to the individual who is buying at a profit?
What uncommon and imaginative acts you are offering to your core customers that differentiate you from your competition?
And finally, I'll leave you with a quote:
“If you want to teach people a new way of thinking, don't bother trying to teach them. Instead, give them a new tool, the use of which will lead to new ways of thinking." - R. Buckminster Fuller; Designer, Inventor, Futurist.