We discuss competitive strategy, what it means to think like your competitor, and how that thinking can drive personal and organizational growth.
We discuss competitive strategy, what it means to think like your competitor, and how that thinking can drive personal and organizational growth.
Dr. D. 0:04
Hello, and welcome to the realm. I'm Dr. D, I bring the strategy.
Dr. K 0:08
And I'm Dr. K, I bring the psychology, we are business psychologists and your guides to the executive realm where we bring strategy and psychology together.
Dr. D. 0:16
So you can bring your best to your C suite, your teams and your customer. Today, we're talking about competitive strategy, what it means to think like your competitor and how that thinking can drive personal and organizational growth. So let's get to work. Dr. K, you are the big sports fan in this dyad. When you think of sports and one team competing against another, how does competitive strategy in your mind play into that
Dr. K 0:40
it does begin with the team itself. You know, it begins with them trying to put together the best players in the best positions. And then it also will depend on the team that they are playing against when Wu comes out. And who plays first that kind of order of the team. Now, that's just the one team itself when they are, you know, looking for competitiveness, they are researching the other team. So they are watching tapes, they are coming together, they are understanding what their individual player, if they are doing a one on one defense, they're going to look at that individual player, they're going to know their player that they have to go to then they're going to look at the defense team, they're going to look at the offensive team, they're going to look at how good their kicker is, do we is there quicker someone that can kick far and we've got to be careful with that what the quarterback does is the quarterback slightly hurt have they been injured, even the smallest injury can change the way a player is, if we want to put that into the business world, every little aspect, when we're talking about strategy, we have to look at every component that an organization has, we have to look at that. Because one little part can change everything. Many
Dr. D. 1:44
organizations get stuck within their four walls and think about what they're doing and how they're doing it. But leave thinking about the competitors to other people in their organization, they might have a strategy team, or maybe the senior executive team are the ones that are thinking most about market positioning and that sort of thing. But it really is important for leaders up and down the responsibility level in an organization to be thinking about competitive strategy. If you're a leader over a customer service organization, you have to be thinking about how your competitors provide service? And are you doing it in a different better way? What's your strengths? And what your weaknesses are? Or if you're in engineering? What products and how are you developing and going to market? Are you trying to copy what others are doing and doing it cheaper? Or are you really trying to be a thought leader in the way that you're going to market with your products, those same concepts that people are very comfortable thinking about for those that are big into sports, they all hold true to business, too, it's just hard for leaders in their day to day role to step out of themselves and emerge into a strategic thinking role and actually set time out of their day out of their month out of their week to actually think about it.
Dr. K 2:54
Absolutely. And that's where in my opinion, that's where we always talk about communication being transparent organizations or leaders need to, as we've talked about, if someone has an idea, or if someone I read this article about this organization that we're trying to compete against, to allow that person to come in and say, Hey, I noticed this is we, you know, again, we don't know something very small, could be the big game changer for any organization. You know, it's important not only for the leaders to look for these things, and also a strategic team. That's why we put those together, you know, it's allowing room for any employee.
Dr. D. 3:34
We've talked before about the power of rivalry. And having a competitive rival is important in sports, it's important in business, it shapes the organization into a focused group of people that are actually targeting a common enemy. It's not really an enemy. But when you think about rivalry, there is another organization out there that's doing a better job at taking your customers away from you, and maybe offering a better product, maybe offering better service, whatever that differentiator is for them. They're doing a good job acquiring customers from you. So you have to think about who is that rival? And maybe you're the small upstart, and there is a juggernaut out there that you're trying to get a piece of their business, what are you going to do that is different and better and distinctive in the way that another organization is doing it, aligning the organization around one rival not just trying to sweep the whole market but around one rival at a time is a strong approach to market strategy.
Dr. K 4:40
If I was you can't really get better if you don't have someone to compete against. So for a company if you were the first one to come up with you know, like a niche idea, that's all great that it could stall out. It could get slow, it may never develop into something more until that rival comes in rivals it can sound maybe a little overwhelming or a little scary. However, that's how we improve because that rival might have one little thing that you're like, I didn't even think about that, let's implement that, or let's make it better. So rivals are, even though you know, you want to be number one at all times, or you want to be the best rivals is what gets us gives us the motivation gives us the inspiration to get going to become number one, or to stay number one,
Dr. D. 5:25
one of the biggest failings of many organizations is they believe they're really, really good at what they do. And they end up with blind spots into their weaknesses. So many examples of organizations that just thought they were knocking it out of the park, they kept focusing on their time-proven strategy. And then they went out of business. These are the folks like blockbuster or Kodak even though Kodak's not really out of business. But these are organizations that didn't adapt their model, they didn't keep an eye on who was coming up behind them. And they ended up fundamentally out of business. If you look at a company like Blackberry, for example, Blackberry dominated the business market in the early 2000s. They had what could arguably at the time be called the best smartphone. And then all of a sudden, out of nowhere, Apple said, we're going to target blackberry and the business market and blackberry took their eye off the ball. It was a couple of years, they were not the leader in the market anymore. And Apple had completely taken over. Apple, to their credit, saw a weakness in the market and saw a large competitor who didn't have their eye on the competition. And were overconfident in their capacity to keep their market share that Apple just snuck in and just wiped them out. And it was just too late for blackberry to respond, the harm is real, the potential for loss in your organization is very real. And so it's really important to look in your organization at yourselves with an open mind, try to find your weaknesses and articulate what your strengths are, you have to define how you see your competition and try to imagine how your competition sees you, your competitors see you differently than you see yourself. And if you are competition, if you are rivals out there have that level of overconfidence have a blackberry or a blockbuster, then you can exploit that to your benefit. You have smart people in your organization, you have to be thinking about what the competition is doing. So you have to be on the offense. And you have to be thinking about who's coming after you.
Dr. K 7:32
Yeah, absolutely. Even if your company is high up, there's always going to be another company or organization, you know, they're watching you. So just because you're at the front of the pack, you need to make sure that you got someone that's looking behind you, you got to have eyes, you know, in the back of your head at all times, because someone's going to come barreling through you need to have people put in place in your organization or on your strategic team always looking for the should have could have was before they become the should have could have would have maybe they start with the what-ifs when we're looking future events. It's what if what if so have someone that's questioning the what-ifs because if if you can come up with that, what if there's a good possibility that someone has already come up with the what if and is already working on it. So you want to have someone having that hindsight bias or the Monday morning quarterbacking that's not getting you anywhere, it's already past 30 happened done and over is asking those what ifs.
Dr. D. 8:24
Absolutely. And that's really the power of having every leader in your organization thinking about competitive strategy. So that's the real value of having every leader in your organization thinking about competitive strategy, how their role, and their team can influence the overall organization to win in the marketplace. There are a lot of places you can get feedback for how you see your organization and others see your organization often people have employees that used to work for a competitor talking to them about what they liked, what they didn't like, where their customers like where they customers didn't like your marketing and sales team, your customer service team talking to customers and having honest conversations about if a customer switched over to you from a competitor What was it that they did well, what didn't they do? Well, what are their expectations from you? And this is really hard for companies to do not because it's tactically difficult but because it's emotionally difficult is reaching out to customers who left your organization for a competitor and really understanding why they left that feedback. Customers will tell you they will absolutely tell you why they made the choice. You know another way to figure out how an organization is thinking about their direction is looking at their career page you go on to competitors website look at what jobs are posting for particularly director level and above positions and you can get a pretty good insight into they have new roles coming available if they've lost some key players can't usually figure out C suite level because those are usually done through hurting firms and generally are posted on their careers. Like, you know,
Dr. K 10:00
there are always little tactics, little ways to figure out what another company is doing, especially nowadays, there's always going to be someone that's talking or blogging, or I don't go on Twitter. But you know, if you check out Twitter and someone that works for that company, or did work for that company, people are leaking things out whether they mean to or not someone or a team or a couple of people that read between the lines of organizations, or employees that have worked for organizations or still work for organizations to kind of figure out where they are going, that comes to
Dr. D. 10:35
the critical idea, how are you differentiating yourself, a lot of organizations are trying to copy a product and do it better at a lower cost your organization, a cost strategy commoditized, as your product, the playing field has changed for so many organizations that even in a cost-competitive market, think of the airline industry, for example, you still have to have exceptional service, and you have to try to differentiate yourself on service, there are many customers who will pay a little bit more to know that they're not going to have the problems that they have with your competitor, the operational errors, the customer service, failings, whatever those things might be. So when I'm advising clients, I often encourage the differentiation based on those intangible things that your organization can bring your ability to execute your ability to provide great service, there are so many different ways to differentiate yourself in the market, it's really important that you are very clear. And that drives the idea of having an organizational imperative, what are the three or four things that you absolutely have to get right, in order to maintain your differentiation in the marketplace, you don't have to talk about how you're going to actually execute against those. But if you are going after a strong customer experience, then your strategic imperative is to make sure that you operationalize that exceptional customer experience in your organization and your strategy as to bet big in terms of financial resources, intellectual resources, your strategic alignment, your mission, those all have to be aligned around whatever that differentiator is that you're going after in your marketplace.
Dr. K 12:18
That differentiation, you also want to align your employees with that leaders need to be aligned with that it's going for that, that achieve, you know, that achievable goal, you know, if you've got a team that isn't really aligned, or maybe , as we talk all the time communication transparency, if they think the goal is skewing to the left a little bit, because they don't fully understand it, they haven't been communicated, you know, enough information, and then that can affect the competitive advantage that can, you know, you know, you're talking about customer service. And if marketing doesn't know that customer service is one of those imperatives, they may not market it in the way that needs to be marketed where a customer might be, wow, I saw, you know, let's all you know, we can talk about advertising, I saw this, and that looked really awesome. So I gave him a call. And it was amazing. But if marketing or advertising isn't on page, with one of the imperatives, it's going to get skewed. And we you know, that's potential for a loss.
Dr. D. 13:22
This happens frequently, as a matter of fact, where a company is working very hard to differentiate based on some elements of service and a salesperson walks into a customer does a sales pitch. And the customer says while you guys are a little pricey, and the salesperson is not comfortable saying here is why we are a little bit more expensive, we will actually save you more money in the long run, because you don't have these types of mistakes. We've figured out how to solve these operational issues. If you go with our competitor, you will have those operational mistakes. And let's be honest, it'll cost you more in the long run. Instead, a salesperson will go well, I'm not going to be able to win this customer because I'm not going to be able to compete on price. And so then they start undercutting the price, degrading the value of the organization in front of the customer undercutting your strategic imperative. And those things happen all the time. This is where as you said, Dr. K, mission alignment is really important, making sure that every person in the organization is aligned on what that mission is. So that the talking points, the theory, the execution are all aligned around that point of differentiation, if your differentiation is on price, and you're committed to offering an equal product at a lower price Be prepared for a competitor to lower their price as well. You end up in this price worse cycle. But maybe that's the only way it works in the market. But you have to be really clear on how you go to market. So when you're thinking about your competition, you have to decide whether you're going to be on the offense or whether you're going to be on the defense Are you going to be first to market in a particular way? Or are you protecting yourself against an aggressive competitor, these things can be solved often through techniques that you can use within your organization. Something like a war room, a game theory, exercise, a gaming exercise, where you bring in smart people in your organization who understand your market and understand your competitors and yourselves, and you break them up into two rooms. And you ask them to solve the same problem one as your own company, and one as an external company. And these things have to be facilitated in the right way, and often take experts to be able to come in and do these sorts of exercises. But essentially, you ask the two, two groups to compete against each other as though they were yourselves and your competitor, you think through so many different opportunities you might not have thought through if you were just trying to imagine what your organization might look like. So it brings some level of real thinking and real strategy to your work. And then you compare notes when you're done. And then it might actually expose a weakness that you have within your own organization. Or you might find an opportunity that nobody in your market has gone to, and you might be able to get there first. So these are really great ways of getting people in your organization to start thinking about the mission. And it's really important that it's not just senior-level people in these exercises, it's great exposure for mid-level managers or even some staff to be a part of because they see things in your organization that you don't necessarily see yourself as a leader.
Dr. K 16:35
You know, it's important to remember, you know, as a leader going to be everybody has a different way of thinking as we talked about different leadership styles and people have different Psychological Types within themselves. If we bring together as you talked about the war room or it's going to broaden how much information in a good way, it's not going to overwhelming information, but it's going to broaden the information or the ideas or the thoughts, the what-ifs will be bigger than then you can filter them out to add them to your organization's strategic plan. And allowing that space is diversity.
Dr. D. 17:14
Diversity in voices certainly makes a difference. Absolutely.
Dr. K 17:17
It does, for sure. All right, dr. D. What can leaders take away from this discussion today?
Dr. D. 17:22
Well, it's important to understand deeply Who are your competitors? What is your organization's perception of your competition and yourselves understand how your competition perceives you ask your customers and employees those who were with your competitors previously? Do they agree with the way that you think about yourself? Don't go after the whole market? Pick a strong rival outlining their strengths and weaknesses and outline your own? Does your competitor have potential weak spots where your strengths can be used? Do you have weak spots that your competitors can exploit War Room scenarios and game techniques contest your organization these are not only to sharpen your competitive focus but also generate ideas and strategies which may strengthen your organization be clear about your path to market against your chosen rival? Are you going to lead or follow compete on price or through other differentiation? Are you going to be on the offense? Are you going to play defense? Once you understand these define your strategic imperatives? What are the three or four mission-critical objectives that you have to get right to win against your primary rival, measure them and estimate how your competition might be performing in those same areas. Align your organization through your strategic planning process, reinforce your mission, align your organization through your strategic planning process, reinforce your mission and monitor the market. Remember bringing in diverse voices brings in diverse perspectives and can help you strengthen your competitive strategy. So with all that said, Dr. Kay, what's on tap for next week.
Dr. K 18:45
Next week, we will be talking about trust at work, how trust is cultivated, earned, and maintained. We'll explore what happens when trust is lost when to try to recover and when to just walk away.
Dr. D. 18:57
Oh, it should be a really fun discussion site. And for this one, this is a Dr. K conversation all the way down, isn't it? And to all of you joining us on this journey to the realm thanks so much. I'm Dr. D.
Dr. K 19:08
And I am Dr. K and we are looking forward to your next visit to the Executive Realm