Competitive advantage

I read this week Jaynie L. Smith book "creating competitive advantage" .. Let me share you some key insights from this book.

Jaynie L. Smith asks, "Why should anyone do business with you, and not your competitor?"

Whether you are a retailer, manufacturer, distributor, or service provider, if you cannot answer this question, you are losing customers, clients and market share.

Smith say scores of companies substantially increased their sales by focusing on their competitive advantages.

What’s the number-one attribute Warren Buffet looks for in a company? "Sustainable competitive advantage," he told an interviewer. If Buffet examined your company, would he find what he’s looking for?

For her book, Smith interviewed the CEO of Jet Blue, David Neeleman who holds a weekly conference call with key executives in which he always asks:

What do we do better than the competition?
What do they do better than us?
How do we do more of that?

He asks these questions once a week.

Smith once worked with a financial advisory firm that decided to delve into this area. Before the in-house drill down, the team reported that its competitive advantages were:

Good reputation
Professional staff
Strong team and leader
Knowledgeable
Strong client relationships
Flexible

As Smith says, "Blah, blah, blah."

After the drill down, the group defined its competitive advantage this way:

Ranked in top 10 percent of money managers who beat S&P nationally
Fastest-growing Fidelity money manager in ’95, ’96, ‘97
Only firm ever featured by Fidelity in its advisory newsletter

For an interior designer, the competitive advantages were ultimately defined as:

The only design team chosen by the top 10 luxury developers in the state
We increased developers’ sales ratio by 35 percent
Our designers have an average 23 years of design experience and are available 24/6

Once you identify that measurable competitive advantage, refine your marketing message to reflect this characteristic of your company. Take responsibility for the marketing message that gets the bang—that answers: why us?

Put it everywhere, including on your:

Web site
Signs
Business cards
Letterhead
E-mail signatures
Publications/brochures
On-hold message for the phones
Don’t get too attached to today’s competitive advantage. It’s a moving target. Once you identify it, your competitors are likely to copycat it.

Be prepared to review your competitive advantage, so it can be refined and re-defined.

As GE’s celebrated former CEO Jack Welch once said, "If you don’t have a competitive advantage, don’t compete"

My quote for the day



"Procrastination and worry are the twin thieves that will try to rob youof your brilliance -- but even the smallest action will drive them fromyour camp."