Did your business

lose the edge?

Little nightly thoughts
by Business Exploration

Dear Fellow Innovator,

You reached Flavio's blog on Business Exploration.

need help?

Let's talk.

If your sales force says that the only way to compete is “price”,
there are good chances that your offer reached a “commodity” status and
you have a really hard time in making your company meet the sales target.

Unless your product or service has been displaced by a new offer
capable to make the same job in a different way ( but substantially better: e.g. cars vs horses ),
one way to see what is happening may be suggested by latest
prof. C. Chirstensen innovation’s management theories.

Let's see how:

You are doing your job too good:

your offer may have ended up over-performing what the Customer needs (uses) to make his job done.

This may happen because:

  • your high-end customers have shrunk
    yes: those clients that have never enough of the performance of your product, have shrunk so much to basically disappear or be totally won by a competitor ( leaving you and all the rest of the competitors' pack fighting for the business opportunities left over )
  • a new type of product/offer ( an innovation ) has disrupted your market,
    stealing all the Customers.

Forget this last situation for a while.: You are in the first one.
After all, is not so easy to bring on the table a totally different idea and kill a market.

How to recover competitiveness?

Here some options, ( apart the usual optimization efforts, best practices, and self-esteem sessions…)

  1. ally and conquer
    you can join the forces with other competitors to gain economy of scale and squeeze out the others.
  2. you can integrate upstream
    gaining a cost advantage that can make you ( or the supplier who bought you…) better equipped for a price war
  3. you can integrate downstream
    Moving to the service side of your business and becoming a system integrator of a larger scope of supply, may help you differentiate again in the eyes of a customer anxious of reducing his fixed costs.
  4. you can disintegrate your business
    Splitting it into the basic components, may help find better sub-systems performances, e.g. moving a subsystem to a Low Cost Country to save costs or closer to the Customer to improve commercialization.
  5. you can integrate your business
    If your business is based on a standard industry platform (probably the same that your competitors are using too), being able to find a way to offer the same level of performance using a totally new (simpler and more convenient ) integrated system, can make you go beyond competitiveness: can make you win the market. (e.g. netbooks vs tablets)
  6. you can buy a new technology
    Buy it where has been developed and import it into a new (local) market, or hire key technologist/marketers and their network, to achieve a new technology transfer and adoption. So changing the game completely…But this is situation “Disruption”…

Don't miss the next hint:

300 more templates and ideas:

find them in our booklet: "The Human Sales",
that Engineers, PHDs, Data Scientists an Technical People use since 2009
to serve communities that value their Innovation:

The Human Sales

(free for students)