In the past few years, cost cutting has been at the forefront of many company’s priorities. Whether in the form of cutting employees, outsourcing, reducing marketing expenses or a myriad of other options, reducing costs has been the de facto strategy for a lot of companies. Those same companies now are faced with the reality that cost-cutting your way to success is a very slippery path, most times leading to a dead-end. As a result, many of those same companies are now seeking ways to generate real top-line growth, now that they have created a streamlined cost structure.
The first question they need to honestly answer is….”what is our competitive advantage?”
What is it about our company that we do better than any one of our competitors?
Or put in another way, why do our customers choose us over our competitors?
More often than not, the answer is “I don’t know”. That may sound like an exaggeration, but its not. The fact is, during all that cost cutting activity, the investments into what made your company unique, your competitive advantage, may have gone away.
In order to grow, you need to either
1.recreate what you had as that competitive advantage, or,
2.decide what your new competitive advantage will and make the investments necessary to bring it to reality. This is often referred to as “pick it and be it.”
Understanding your true competitive advantage, and crystalizing it with everyone in your company, leads to a key criteria for decision making on a daily basis.
Does a planned investment reinforce your competitive advantage?
Does a new product help reinforce your competitive advantage?
Does a new hire help reinforce your competitive advantage?
If you fall into the group that really doesn’t have an answer, don’t panic. Its not to late….yet.
When it comes to competitive advantage, “pick it…be it…and grow.”