Competition Awareness: Have You Heard Anything About Your Competition Lately?

McKinsey has surveyed companies worldwide in several branches, asking those companies when they heard about the last strategic move of their competition. About half of the companies became aware of important competition changes after the new initiatives were already on the market!

The survey investigated important changes like a new innovative product or a significant price slash. Respondents were more aware of coming new products than price cuts. However, in the best case, the new product, only about half of the companies was aware of that in advance. The awareness about price slashes was far more worse.

Also interesting was the response reaction. The theory says that an adequate reaction should be immediate. But the answers provided no evidence of that. If there was some reaction, companies analyzed just a few obvious possibilities, or took a decision based on gut feeling.

I ask myself the question why companies react like this. Why show such a reactive response instead of a more pro-active way of working? Sometimes I think that the internal processes of companies, including politics, are some sort of substitution for the purpose of the existence of their business. According to the late Peter Drucker the purpose of a business is to create customers.

I can understand that there is little time to deliberate about possible moves of your competition. But there is one principle I would recommend you to follow as minimum: Measure and manage the satisfaction of your customers compared to the competition: The relative customer perception of quality. This way of outside looking in makes you stay on track your safe enough!

Are you on track? Does your competition never surprise you? How about sparring with your Personal Business Coach? Contact Hans Lodder now, and experience how this can help you! Or let Hans Lodder train your employees, and do it all by yourself from now on!