To reach a broader audience, we put this tip on ‘The Leadership and Learning Podcast. If you haven’t listened to our podcast yet, I invite you to. You can pick it up on iTunes, Spotify, Sound Cloud and Google Play
or listen directly on our website here – thank you, Randy Goruk
Jack Welch, the former CEO of General Electric provides solid advice to pay attention to in the form of quotations on competitive advantage:
- “If you don’t have a competitive advantage, don’t compete.”
- “There are only two sources of competitive advantage: the ability to learn more about our customers faster than the competition and the ability to turn that learning into action faster than the competition.”
- “An organization’s ability to learn, and translate that learning into action rapidly, is the ultimate competitive advantage.”
Can you identify companies no longer in business or have fallen as market share leaders? Think about Blockbuster, Toys R Us, Sports Authority, Sears . . . and consider the other companies that have disappeared or been cobbled up.
What happened? These companies didn’t pay close enough attention and/or didn’t respond well enough to the competition. They went from owning a dominant market share in their space to little or no market share. Maybe they tried to differentiate but likely had no competitive advantage.
Critically evaluate your true competitive advantage and strengthen it.
“Competitive advantage” is when you have something your competitors don’t, thereby placing your company in a favorable business position. This is different than “differentiation” (no pun intended).
Being different is good, but having a distinct competitive advantage is better. To gain that:
- Understand your true competitive advantage, then aggressively exploit it. If you don’t think you have one, don’t let time slip by before you create one.
- Understand your true competitive disadvantage, then get on with closing the gap between it and your competitive advantage.
How? As a start, ask yourself these questions:
- Which of our products and/or services give us a competitive advantage?
- What makes us think this advantage is real?
- Which products and/or services give our competitors a competitive advantage over us?
- What are we doing about that?
- Are we truly competing against others, or are we simply conducting business?
As leaders, we need to pay attention to our true competitive positioning. If we’re not dominating our market, then we need to change or possibly reinvent our business…now.
Companies that have a true competitive advantage flourish. And those that don’t, don’t.
Let me know if you need a little help.