BIZBUZZ: Gary Hamel: Competing For The Future

Hi, I’m Gary Brown a FocalPoint business coach.

Welcome to episode 13 of BIZBUZZ.

I stimulate conversations in order to challenge business owners to Be Different and to Act Boldly.

The following video highlights some content from Competing For The Future, written by Gary Hamel. I enjoyed reading this book and it offers some interesting observations on the subject of differentiation, which is one of my favourite topics.

http://youtu.be/8MCbRuKBEgI

I am going to highlight three of Hamel’s suggestions that I find particularly noteworthy.

The first one deals with return on investment (our return/our investment). Hamel contends that we spend too much time obsessing over the denominator (the amount invested). In an environment where our competitors are growing, denominator reduction with steady revenue is simply a way to profitably sell market share. Hmm. Do we know how well our competitors are performing?  Are we paying sufficient attention to what is happening with the numerator?

Secondly, Hamel suggests that tomorrow’s competitive advantages must necessarily be different from today’s. Companies must be capable of getting different. He further states that laggards follow the path of least resistance.  However, challengers follow the path of greatest opportunity. Which are we?

There are numerous other interesting tidbits in this book but I’m going to end on Hamel’s assertion that it is not necessary to be a seer to discover the future but it is absolutely vital that you be unorthodox. Now if that isn’t a call for differentiation, what is?

Well, that’s it for Competing For The Future.

Thanks for watching.

Your comments are always welcome.

Stay tuned for more BIZ BUZZ.

How to Win the B2B Price War

In this world of high speed communication and 140 character limits, we seem to have become infatuated with short forms and acronyms.  It isn’t too hard to draw the comparison between our communications today and the game of horseshoes. In other words, we use vocabulary with less precision than a given word actually conveys, but that’s okay because getting close seems to be good enough.

 

 

 

 

 

 

 

 

Or is it?

 

 

What has this got to do with pricing you might ask? We invariably talk about the cost or price of a product or service that we are either buying or selling. However, when we are ‘on our game’, we’ll use the word investment or introduce the idea of value. Unfortunately, old habits die hard and it is very easy to forget to reinforce the result that one can achieve from an investment that has been made.

Now, we might ask ourselves, “what’s the big deal?” In my mind, the big deal results when we think about the behaviour and attitude that are generally attached to the words cost and investment.

Costs are generally meant to be controlled. Costs tend to be something that we either want to avoid, reduce or, at a minimum, hold constant.  The word cost tends to cause us to think in terms of such adjectives as “expensive”. If ‘how much does this cost‘ is an early question asked by the prospect, then chances are we have not established our value proposition with this person.  It will also be difficult for us to know how to clearly articulate our value proposition if we have not identified the emotion that underlies a prospect’s initial interest in our product or service.  Without this knowledge, we are simply ‘pulling on levers’ without knowing if the levers are connected to anything of meaning to the prospect.

So, … we’ll be in a much better position if we can not only understand the prospect’s stated need, but also the underlying emotional reason for this need. With this understanding firmly in hand, we can speak much more confidently about the return that is possible with the investment being considered. We’ll understand how our product or service can address the emotional need of the prospect. We’ll be able to speak about the value to be derived from the investment being contemplated.

If we’ve made the emotional connection with our prospect, then the level of trust that the prospect ascribes to us will be much higher.  A trusting relationship supported by our understanding of the emotion driving the prospect will greatly diminish any focus on price and solidly centre the conversation on value. Price may not be part of the discussion.

In the parlance of horsehoes, a ‘ringer’ could be just the next ‘pitch’ away.