Newsflash: most up-and-coming businesses have more competitors and less competitive advantages than they think. If your business has a found a way to rake in the cash, you can bet your bottom dollar that your rivals have formed a queue to do the same. Prepare to edge them out.
If your firm’s competitive risks aren’t being addressed proactively and strategically, your business is at a competitive disadvantage, which affects its ability to grow and compete as it should. Forming a competitive risk assessment team is a great first step in the right direction.
Innovation, price wars and such are all fair game in business.
But business is much more hard-core sometimes and your rivals won’t always use kid gloves. Sometimes, the gloves come off and they go straight for the jugular.
For starters, they’ll headhunt (and poach) your best staff, start a rumour mill about your company and even copy your products or services (in this case, imitation really isn’t the highest form of flattery).
So, to stay several steps ahead of the competition, you have to have your wits about you. Here’s our guide to outcompeting your competitors.
Are competitive risks on your radar?
Competitive risks should always be on your radar. Your job is to ensure that none of them fly under it. Here’s how.
1.Form a ‘dream team’ (of the competitive risk assessment kind)
Do you remember the US men’s basketball ‘dream team’ from the Olympic Games in ‘92?
They had the best of the best all on one side – NBA Hall of Famers Michael Jordan, Scottie Pippen, ‘Magic’ Johnson, Larry Bird to name but a few. The result? They annihilated the competition en route to collecting the gold medal, barely breaking a sweat.
According to leadership expert, John C. Maxwell:
“Teamwork makes the dream work, but a vision becomes a nightmare when the leader has a big dream and a bad team.”
So, be on the lookout for your company’s rising stars in sales, marketing, IT, HR, finance and legal. Double-up your efforts by inviting external suppliers and experts to pledge their allegiance, too.
Then merge the two groups to form a competitive risk assessment team whose only purpose is to help your company understand the extent of the competitive risks it faces.
2.Pinpoint your competitors
No self-respecting businessperson would enter (or even contemplate entering) a market without first checking out the competition.
Find other firms operating in the same space and gather ‘intel’ on their products, services, etc from publicly-available sources, such as DueDil. Then make a firm assessment of whether your competitors pose a real threat to your market position.
3.Invest in research and development
In the words of the late Steve Jobs, co-founder of the Apple computer, “Innovation distinguishes between a leader and a follower.”
Try to stay ahead of the pack by investing in research and development centred on your main business and related areas. Your research may give you a heads-up on what the future holds, giving you the vantage point of being able to create products of greater value than even your closest and most fierce rivals.
4.Prioritise your customers
This should go without saying, but we’ll say it anyway: the customer always comes first.
Focus your attention on your customers by putting feedback structures in place to monitor their expectations.
Before you embark on the long road to production, run it past the checklist of your customers’ needs. (If it doesn’t fit, it’s best to quit.)
5.Study your market
Market dynamics are all-important.
Not all risks present a threat to your business. Some present opportunities.
Knowing your business strengths, weaknesses, opportunities and threats (SWOT) will ensure that you can tell the difference between a risk that’s a threat and one that’s an opportunity.
You’ll then have the confidence to entrust your team with the task of conjuring up ideas to convert risk into profit and discuss the worst-case scenarios and strategies for coping with them.
What kind of leader are you?
There are leaders and then there are ‘leaders.’
Broadly speaking, two types of leader dominate the marketplace: market-driven leaders and operations-driven leaders.
The most successful and competitive enterprises tend to be spearheaded by market-driven leaders who are in constant pursuit of new ways to predict product and marketing strategies to activate engagement from customers and staff alike.
By contrast, companies that grow and compete at sub-optimal levels are often fronted by operations-driven leaders. They tend to lack vision, be complacent and remain steadfast in their ways, convinced that they are not susceptible to new market conditions.
Forbes has a handy checklist, so you can work out which type of leader you are.
If you want your business to be head and shoulders above the competition, your leadership style should probably be market-driven. Then you can, in turn, drive your competitors off the scene.