“Is our competitive advantage working?” is a question raised in boardrooms and executive leadership team meetings around the world on a very regular basis.
The first step in understanding how effectively your competitive advantage is working is to understand what your organizational competitive advantage is- as viewed through the eyes of your customers. A challenge facing a number of companies today is that their management teams are not aligned on what the organizational competitive advantage is and how the customer views this perceived competitive advantage.
The understanding of your organizational competitive advantage commences with making your competitive advantage visible: I recommend during your next management meeting to take 10 minutes and ask each person in the room to individually write on a piece of paper the competitive advantage of the company which enables customers to choose your products and services over the competition. When the ten minutes has elapsed, ask everyone to tape their versions of competitive advantage to a wall, flip-chart, display screen, etc. If all the answers to this question are the same- this is a good initial signal. If the answers are varying- this is a good time to commence a discussion on competitive advantage and possibly schedule a work-session with your management team.
Once your competitive advantage is aligned- meaning that all of your management team(s) view this in the same way and can vocalize with consistency what the competitive advantage of the organization IS- the time has come to test this with your customers. One of the better approaches to testing with your customers is to conduct a third party survey of your most important customers, the customers you have lost, and the customers you need to gain in the future for your strategy to be fully successful- and in this survey validate that the attributes and buyer benefits of your competitive advantage translate into a unique and valuable combination as viewed by your customers.
On completion of this survey- which normally has a duration of four to six weeks- schedule with your management team to view the results and ask:
1) How closely do the results of the survey correlate to the competitive advantage we believe we deliver to our present and future customers?
2) What unexpected deviations in results exist?
3) What is the root cause of the deviations in results? If we don’t know- what data do we need to identify root cause?
4) What plans of action can we take/do we need to take to address the deviations?
The answers to these questions will assist your management team as one step in acheiving “Sustainable Competitive advantage”.
My colleague Diego Miglioranzi will be following up this week in our blog with greater detail on how to attain this important information from the best source there is: Your Customers.