competition

are you destined to be winner or loser?

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> identifying competitors
> performance
> rules of the game
> what can consultants do?

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or shall all have prizes?

In the past, if you had a decent product at a reasonable price, and you had a competent organization with efficient and effective procedures, you could expect to make a comfortable profit.

In many competitive arenas, sheer decency and competence just isn't enough. If you want to win a Gold Medal, a Grand Slam, a World Cup or some other sporting trophy, or if you want to win the Leeds Piano Competition, it just isn't good enough to be reasonably talented and hard-working. You have to be better than that to be allowed to compete in the first place!

In the past, much of the business world has been protected from this level of competition. In this protected context, business failure is seen either as an inevitable consequence of gross incompetence or bad judgement, or as an Act of God, randomly striking the odd businessmen with lightening bolts.

One of the consequences of internet and e-business is to remove some of this protection, and to nudge us towards a Winner-Takes-All world.

Identifying competitors?

veryard projects > competition > identifying competitors

One definition would be that a competitor is any enterprise that poses a threat to your present or future market share. A broader definition would be any enterprise that poses a threat to any of your key business objectives or performance measures.

Who perceives you as a competitor? According to this definition, it would be any enterprise that regards you (rightly or wrongly) as posing a threat to its market share, growth or profit, or other objectives.

One of the things that has to be managed therefore, as part of the strategy of an enterprise (and the Japanese seem to be rather good at this) is the timing of perceptions - when do your competitors start to perceive you as a threat, and is it then too late for them to do anything about it? (When did IBM start to perceive Microsoft as a competitor?)

I was working in the credit card industry in the late 1980s, when Sears launched its Discover card. Many people in the credit card industry assumed they knew who their competitors were, and were taken aback by the sudden appearance of a new, unexpected competitor.

Identification of competitors (or competitive threats) is a complex information processing / knowledge management task, and requires careful consideration.

Identifying members of complex classes

Performance

Outstanding performance comes from taking risks, not from playing safe.

You don't go to the Carnegie Hall to hear a competent, technically perfect performance. You go to hear someone taking the music to new heights of passion and articulation, even if they play a few wrong notes along the way.

Rules of the game

If you want to stay in the game, you have to understand that the rules have changed, are changing, and will continue to change.
Imagine a Rugby schoolboy saying: “I’m not going to pick up the ball. I’m just going to kick it, like my father and grandfather before me. I’m sure this handling is just a fad, and then we’ll settle back down to good old kicking.” (for kicking read traditional business principles)

If you have enough power, proximity and/or interest, you may try to change the rules of the game, or at least influence them. (Changing the rules of the game is itself another game!) That also requires an understanding of the current set of rules.

What can consultants do?

In the past, much of the attention of managers and consultants has gone to removing the obstacles to competitiveness. We can see business process reengineering in this light. If everyone in your industry has poor processes, then you can get an advantage from having good processes; but if everyone in your industry has good processes, then that clearly isn't enough.

Consultants, management gurus and investment analysts will be scrutinizing the winners, to try and identify and replicate the characteristics of the winners. Probably one of the most important characteristics of the true winners is that they don't pay much attention to this stuff. They certainly don't waste energy trying to copy someone else's formula for success.

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