Having a strategy for gaining a competitive advantage over your best competitors will lead to increased market share and long-term growth and profit.
Frederick the Great, an outstanding military strategist, said, “It is pardonable to be defeated, but never to be surprised.”
This bit of wisdom applies equally well in today’s business world as it did in yesterday’s military world. Many business people today define “competitive advantage” in terms of technical advances, lower prices, economy-of-scale manufactory and mass marketing advantages. These are old measures of competitive advantage. They do not fit into today’s technological world – a world that uses warfare concepts as a guide to successful sales and profits and technology as weapons of war.
Today, “competitive advantage” is a multifaceted process with several related components, all of which are designed to provide an organization with an advantage over its competition in the global marketplace. In a world of mature markets, most of us have learned that competitive advantage is the only way to steal customers and market share from our competition and grow our business profitability.
Here are the three critical facets of today’s competitive advantage.
• The Information Facet: Corporate intelligence is the process of putting seemingly unrelated pieces of information together to create a new picture of the market and competition. It is a way of using sophisticated information gathering tools to form disparate bits of data into very enlightening “moments of truth”.
Until recently, “corporate intelligence” was an oxymoron. The information gathering systems were crude and the use of hte information was haphazard at best. Today, however, organizations have developed intelligence-gathering systems with links around the world. These new information systems transform information from boring library reading to market leadership.
In 1985, AT&T started the most effective competitive operation in the telecommunications industry at he time. They called it AAA – Access to AT&T Analysts. This system allowed every employee of the firm to send bits and pieces of information on competitors to a central source where they were collated and sent to top management strategists to be used to develop a competitive advantage.
• The Strategy Facet: Strategy has the same role to sales and marketing as quality has to manufacturing. Both strategy and quality are foundations of success in their respective areas.
Strategy, loosely defined, is a game plan. It is a method of gaining customers, growing market share, and moving ahead of the competition. Strategy is both an offensive and defensive opportunity. While you analyze and plot your game plan, you must also do the same for all of your competitors. Strategy means keeping competitors from succeeding at their game plans, while at the same time, achieving yours. Strategy is the alignment of all your assets to achieve maximum utilization at minimum cost for maximum value.
• The People Facet: There is an Italian proverb that says, “Though your enemy seems like a mouse, watch him like a lion.”
Professional sales people are always on the lookout for new ideas, for competitive products and for any significant market changes .They drive competitive advantages from the bottom up, rather than from the top down.
Every team member in the organization is a player in gaining competitive advantage. In markets where products and services are basically the same, it is the people in the firm who make it different and give it uniqueness.
People drive market advantage much more than technology in all but the highest-tech industries. People drive product and service acceptance in mature markets where features, benefits, and values are interchangeable. People drive quality, customer satisfaction, and long-term relationships that lead to growth and profit.
It will never do to be surprised in today’s competitive global marketplace. You may be defeated in certain endeavors, but like an outstanding chess player you should know why you were defeated and have a new game plan for the rematch.
competitive advantage is a multi-faceted process that will lead you to increased market share and long-term growth and profit.