Competitive Advantage

​Happy New Year! I hope you had a wonderful Christmas, a restful break, and can still remember both of them.
 
In the December Beacon, I wrote about identifying your ideal Target Market Customer, and their greatest need. This month we’ll look at Competitive Advantage – a strategic position that is favourable compared to your competitors. Your competitive advantage answers the question, “Why should your target market buy from you instead of someone else?” If you want your business to grow, you need a competitive advantage.
 
I like to use a model called Value Disciplines described in the book The Discipline of Market Leaders by Treacy and Wiersema. I recommend you read this book. The basic idea is to build market leadership (competitive advantage) in one of the three value disciplines. They are:

1. Operational Excellence – a narrow range of products, standardised processes and service. Elimination of complexity, minimisation of overhead, process steps, and transaction costs. Operationally excellent companies deliver simple products and services with minimal fuss, efficiency and competitive pricing.
2. Customer Intimacy – products and services tailored to meet the unique needs of each individual customer. A focus on a deep understanding of customers’ circumstances, rapid development of solutions, long term relationships and customer loyalty.
3. Product Leadership – continually updated, leading edge products. Fast-paced, innovation driven. A focus on time to market, and quick decision-making. Product leaders often cannibalise their own products before their competitors do.

​You will find your sweet spot when you select the Value Discipline that best addresses the greatest needs of your Target Market. This is your Competitive Advantage. The great temptation is to try to be wonderful at all three disciplines, but along this way lies wailing and gnashing of teeth – trying to be all things to all people ALWAYS results in mediocrity and burnout. 

The great temptation is to try to be wonderful at all three disciplines, but along this way lies wailing and gnashing of teeth

Focus! Place the vast majority of your investment (time, money, energy, learning) into your chosen value discipline. If you are at the minimum level required for survival in your industry for the other two disciplines, leave them be!
 
This competitive advantage should drive all your marketing and branding messages – including your positioning statement and brand promise. Everything should be consistent so that your overall message to your target market is unmistakable.
 
Next month we will draw all of the vision and strategy stuff together into some strategic objectives.