Many people today are looking to the end of the Covid Tunnel and how to rebuild their sales pipeline. They may look to the latest app or system, but they have tunnel vision when it comes to understanding what their competitors are planning.
It’s easy to buy technology but without the embedding the right mindset in your people you are unlikely to get the desired bump in sales.
Let’s recalibrate and look to the master of competitive strategy, Sun Tzu, and how contemporary authors support his thinking. (Sawyer, 1994)
When buyers weigh your value against your competitors’, they mostly use:
- Past buying experiences
- New and emergent needs
- Knowledge of your capabilities
- Perceptions about your company and brand
To be successful in complex sales and beat-out your competition, you need to understand:
- How your value differs from your competitors’ in the buyer’s eyes.
- Who is involved in influencing the buying decision?
- What are the buyer’s value metrics and tactics?
- What more can you bring to the table to make your solution stand out?
Assessing your competitors’ strategies will uncover areas where your competitors are most vulnerable and then help you deliver value differentiating messages. You will gain greater influence over:
- The factors customers use when making decisions
- How these factors are weighed
- How you can create counter-competitive tactics
With value discovery you will gain far better intel and sense your buyer’s changing priorities. This early warning system creates more time to work both offensively and defensively to influence their decision-making.
Is it difficult to find out how your competitors are differentiating themselves?
It can be if…
- You aren’t paying enough attention to your competitors, or
- You believe such an analysis is a One-and-Done exercise
For instance, many competitors don’t behave the same way between different regions or divisions. A competitor may be your partner in one geography yet a competitor in another. What they do in Idaho is often quite different than what they’re doing in Chicagoland.
Why don’t companies recognize such competitive strategies before it’s too late?
There are a few reasons. It’s possible they don’t focus on reading competitive strategies and tactics quickly enough to make a difference. Such signals are not easy to read and need deciphering, but this can be done through systematic and aligned processes.
Other reasons include:
- Top management isn’t close enough to the market – They think they know but…
- Executives fail to accept the competitive realities when shared by sales and marketing.
- Companies rely on intelligence that is biased, subjective, filtered, or outdated.
- Many organizations discount or ignore survey and market trends unless they endorse their inherent positions.
What are the consequences?
Without taking specific preventive measures, such as ensuring top managers consider competitive information in their decision-making, companies will face unexpected change time and again.
Maybe you are thinking:
“Who has the time to continually and systematically identify these signals early?” or
“Who has the expertise to attempt to decode them?”
The answer: Your people.
Those who are in daily contact with the competitive arena can help develop your competitive agility. Their intel will help you:
- Move on three fronts: content, context, and process
- Be unpredictable and less identifiable to your competition
- Be experimental
Five Domains of Creating Competitive Strategy (Whipp, 1991)
It’s not surprising that higher-performing organizations are better at handling strategic change. They can manage and integrate five key actions of change:
1. Assess the competitive environment
2. Lead change
3. Link strategic and operational change
4. Competitive learning
5. Orchestrate competitive change
1. Assess the Competitive Environment
The problem is not only environmental sensing, but also sense-making (Weick, 1995). Sensing tends to be by individuals whereas sense-making involves collective processing. The organization must be an open-learning system and not reliant on one specialist function.
Successful competitive sensing and sense-making requires key people to champion assessment techniques, which increases openness. In addition, both structure and culture are needed to encourage environment and customer-facing behaviors.
Even then, there’s no guarantee that anything will change without actions to drive this assessment capacity forward.
For Example:
You learn that a competitor is opening a new office several states away and a key managing principal is moving to start the office. Will that impact their local competitiveness? Are you servicing that market remotely? Would it be a good idea to follow suite?
2. Lead Change
It’s not just about ensuring the environment is understood; the need is to ensure the organization learns and acts on new information, which requires courageous leadership. (Anderson, 2014)
Unpredictability makes the prospect of greater control remote, which many executives crave. This is the leadership challenge. Often, it’s coupled with leaders believing big initiatives are the route to success, when in fact, they are of limited value and may be dangerous.
Paradoxically, effective leadership relies on the gradual and modest, supported by processes that encourage analysis of changing circumstances. Effective leadership relies on shaping a long-term process rather than one big initiative.
Another challenge is making decisions with too few people. Competitive research suggests leading an organization through change doesn’t imply reliance on one leader. Higher performing companies:
- Create a broader notion of collective leadership at higher levels.
- Embed a complimentary sense of leadership and responsibility at lower levels.
Leaders need to recognize success depends on using incremental and unspectacular steps. It involves integrating competitive actions at all levels.
Building a climate for leading change also needs to raise energy levels and set new directions. You will need to:
- Show why the changes are needed.
- Build organizational capabilities to mount change.
- Establish an agenda that sets direction, vision, and values.
For Example:
In Sales Leadership, leading change means demonstrating that you are curious about your people’s ’tidbits’ from the field. Leaders must NOT put someone down for bringing contradictory evidence, but treat the information as a data point that needs to be triangulated.
3. Link Strategic and Operational Change
Translating strategy into action isn’t a neat sequence of steps to a logical outcome. It relies on breaking through ignorance or resistance with rapid cycles of “Think, Do, Fix” and failing fast to make incremental adjustments to develop momentum. (Ashmore, 2015)
Focus on:
- Getting people to open- up and understand what didn’t work before and reinforce the changes that need to be made.
- Sustaining speed, intensity, and momentum of the process
- Recognizing that re-formulation of strategy will occur, setting the expectation that you might not get it right the first time.
- Translating strategic intent into reality by showing people their WIIFM (What’s in It for Me)
Then, new knowledge and insights gained during implementation of a strategy can be captured, retained, and disseminated. You’ll be replicating success and avoiding failures better than your competition.
For Example: Use AAR (After Action Reviews) to ask:
- What was planned?
- What was the outcome?
- Why was there a delta?
- What did we learn?
4. Competitive Learning (Senge, 2006)
Competitive organizations need to create learning cycles that:
- Develop the value of competitive knowledge as a key differentiating weapon.
- Educate in a way that generates, maintains, and regenerates that knowledge.
- Discover ways of exposing knowledge locked-up in the procedural repertoires of the firm.
- Ensure the knowledge base of the firm matches changing competitive conditions.
Competitive learning cycles involve observation, reflection, hypothesizing, experimentation, action, and hands-on application. What’s learned must be codified and diffused.
Learning cycles are team-based. Individuals collectively develop their knowledge, values, and shared mental models of their competitive environment. It goes beyond training. An approach that embraces experimentation to reshape attitudes and values is required.
The need to eliminate or unlearn entrenched knowledge and beliefs is often overlooked. Shedding outmoded knowledge, techniques, and beliefs, and then learning new ones to carry out strategies is crucial. The ability to do so faster and more effectively than your competitors is priceless.
For Example:
Set up training in how to use LinkedIn for competitive alerts and set up auto alerts on competitors and their technology. Then hold people accountable for daily use.
5. Orchestrate Competitive Change
Research has proven there is a need for competitive integrity between the strategic competitive position adopted by the firm, internal resources, and external collaborators. (Whipp, 1991) Such orchestration isn’t easily attained or maintained. It means solving analytical, educational, and cultural problems.
The problem of orchestration lies in the divergence between official goals and more routine decisions like the urgent drives. As Kanter says, “There are many rules for stifling innovation.” (Kanter, 1984) These include multiple layers of managerial approval, intensive controls, secretive decision-making, and suspicion of new ideas.
In other words, corporate contradictions prevent change. They are formidable obstacles to which many give little attention. Competitiveness rests not only on aligning these aspects, but also replicating what works.
For Example:
Leaders need to ensure there is alignment on the means, methods, and time it will take to implement competitive tactics. It is equally important that executives avoid where-are-the-sales? types of behavior and emphasize intermediate metrics to measure and sustain progress.
Analyzing your competitors’ strategy is the tip of the spear, targeted and driven by superior focus, specific processes, and leadership that galvanizes an organization. It is sustained by the belief that being competitive is about making sense of changing market conditions, customer needs, priorities, and competitive responses.
About the author: Nick Anderson is Managing Partner The Crispian Advantage and co-author of Focusing Change to Win (2014)
Bibliography
Anderson, N. &. (2014). Focusing Change To Win. Boise: Createspace.
Ashmore, S. (2015). Introduction to Agile Methods . Pearson Education.
Kanter, R. (1984). The Change Masters: Corporate Entrepreneurs at Work. New York: Simon & Schuster.
Sawyer, R. D. (1994). Sun Tzu – The Art of War.
Senge, P. (2006). The Fifth Discipline: The Art & Practice of The Learning Organization. Doubleday.
Weick, K. (1995). Sensemaking in Organizations. Thousand Oaks: Sage Publications.
Whipp, P. &. (1991). Managing Change for Competitive Success Oxford. Blackwell Publishers.
Other interesting blogs:
- Balancing Top Down and Bottom Up Approaches to Successful Change
- Strategic Synchronization – The First Step to Aligning Your Organization
- Managing Change in a Time of Crisis