Show notes
Show Notes: Will Bachman and John Horn talk about competitors and how they should be taken into account when formulating a strategy. John points out that lowering the price is an easy response to a new product or market entry, which can prevent success. He suggests that understanding the competitor's mindset is a key element to predicting their next move and positioning oneself for success. He also emphasizes the importance of being aware of the competitors' strategies, as it can influence the success of any new idea or product. A Framework to Understand the Competitor's Mindset John states that companies should pay attention to both their customers and their competitors depending on the type of market they are in. For established markets, such as toilet paper, companies should focus on competitors and their pricing, product innovation, and market entry challenges. For newer markets, like AI, companies should focus on customers since customers may not know what they want and the market is open and wide. John believes that it is important to have different departments that focus on each aspect since customer and competitor focuses require different approaches. However, it is essential for companies to be aware of both their customers and their competitors in order to remain competitive in the market. John talks about the importance of competition intelligence in developing an organization's strategy. He explains the Blue Ocean analogy-- the idea of swimming in uncharted waters to find success. He emphasizes that one must understand why the competition is not in the blue ocean before considering it as a viable option. He then outlines his four-step framework for gathering competition intelligence: reviewing public communication and actions; assessing competitor assets and resources; considering the human factor; and predicting, observing, and adjusting. This framework can help organizations build a picture of their competitors' mindset and ultimately develop a successful strategy. How to Gather Competitive Intelligence John offers advice to a growing company that wants to build a competitive intelligence function. John recommends gathering information from companies that scrape and gather information from publicly available sources such as SEC filings, the company's website, and social media. He notes that the most valuable information comes from within the organization, and suggests running WarGames, which are business simulations that involve setting up players, choices, and a timeframe to unlock competitive insight. John gives a few examples of questions that should be asked. Companies can use a CRM system to gain better insight into their competitors. The idea is to start with one question, such as Who do you talk about? and then gradually add more questions to the CRM form to prime sales agents to ask about competitors. This will help the company track which competitors are discussed in different geographies and customer types, and what pricing, product portfolio, partners, etc. are discussed. This data can then be used to identify which sales agents have reported the most about a particular competitor, and to ask them for more information. This will make it easier for the company to collect information that may already be in the heads of their staff. Collecting Data to Understand Competitors John talks about the value of collecting data to understand competitors. He suggests that data should not be collected by marketing or finance unless they are strategically focused and deliberate, as it may not receive enough focus. He adds that asking questions up and down the supply chain can be a great way to collect information, but there can be challenges in how it is implemented. John explains that competitive insight functions are cost centers, meaning that they don't directly drive revenue, so it can be difficult to get buy-in from the senior level team. He explains the best way to ensure competitive intelligence is properly implemented. When using competitive insight to make strategic decisions within an organization, it is important to start small and focus on one or two competitors at a time. It is also important to identify which teams within the organization need what type of information. John also stresses the value in using anecdotes and using story over data to gain support from senior leaders. Investing Competitive Intelligence John highlights the value of focusing on the competitor's USP to gain valuable insight. He explains how to convince senior leaders of the need for a competitive insight function. He suggests using stories to demonstrate the value of CI and its ability to help prevent costly mistakes. He also suggests that if senior leaders are convinced of the importance of CI and can see its value, they will continue to invest in it. He gives an example of a company where the CI function had such strong support from senior leadership that anyone making a strategic presentation to the CEO had to first consult with the CI group or leave the room. His conclusion is that, if senior leaders can be convinced of the value of CI, they will continue to invest in it. Finally, he provided links to his own firm, Gateway Insights, and the Washington University Olin Business School website for anyone who wanted to contact him and learn more about competitive intelligence. Timestamps: 03:10 Balancing Attention Between Customers and Competitors 08:15 Understanding the Competition for Strategic Planning 09:05 Investigating the decision makers 13:25 Building a Competitive Intelligence Function for Growing Companies 15:30 Competitive intelligence type of dashboard function 21:50 Collecting Data and Voice of the Customer Insights 26:57 Exploring the Role of Competitive Intelligence in Decision Making 27:46 Competitive insight functions as cost centers 29:18 Defining which team needs what information 31:14 Using anecdotes to inspire action from leaders Links: Website: www.gatewayinsights.com CONTACT INFO: Email: [email protected] Unleashed is produced by Umbrex, which has a mission of connecting independent management consultants with one another, creating opportunities for members to meet, build relationships, and share lessons learned. Learn more at www.umbrex.com.