Identifying key factors of competition in an industry is not a straightforward process. The challenge lies in the fact that the various constituencies in the industry all see competitive factors through their own lens.
The CEOs see competitive factors one way. The frontline workers see competition another way and consumers see something entirely different from everyone else. We tend to see things very much in ways that are based on our own responsibilities.
If I’m responsible for delivering a certain part of a customer experience, that’s how I’ll see the competition. I won’t be paying a lot of attention to other parts of the business or supply chain that may be heavily affecting how competition really is measured.
So what to do? And why is it important?
Let’s discuss the importance of the process first. Without the company’s strategy being founded properly on sound knowledge of key competitive factors it is impossible to remain focused. Goal diffusion and a message that’s frayed around the edges will be the result. Companies end up funding competing initiatives, miscommunication to consumers takes place, and companies end up dying from a thousand cuts so to speak.
How does one make sure key factors of competition are known and agreed upon?
There are no shortcuts. Larger companies get significant groups of frontline, midlevel, and senior management involved. Without all constituencies being represented, there will be insufficient representation of all key factors. Each individual has to be able to contribute their thoughts and findings, data driven and anecdotal, on what they see as competitive factors.
This is the necessary pain involved in defining the current state of play.
As far as the exercise goes, and you may do this remotely, build a simple survey in surveymonkey.com.
Ask the following question/questions.
- What do you see as the single greatest feature, tool, offering, or product you compete on when comparing what you do in the company compared to a competitor?
- What do you believe the competition does better than we do?
- What do you believe we do better than the competition?
Deliver these questions and if possible, put a narrow time frame on response time. Perhaps end of business that day or no longer than 12 hours. You don’t want people collaborating on answers yet. Anonymize the form so all are comfortable sharing honest answers. They will have a chance to defend later.
Once received, pay attention to the answers. Are there correlations? Are there some surprises? Generally, you’ll find that there are blind spots as it pertains to what the executive thought key competitive factors really were. You’ll find that strategies need definition or that there were shortcomings in the original plan.
Your results will allow for beneficial discussions around what business you are really in. You’ll find that you may have strayed off course. If so, isn’t it better to know than to have continued without knowledge of a needed course correction?
You final destination is the As-Is Strategy Canvas. This starting point tool will afford you a visualization that serves to make it very obvious to the team and your company’s employees where and how the company fares against the competition. Here is the basic layout.
Sherman G. Mohr is an Insead Certified Blue Ocean Strategist residing in Nashville, TN