Dear SBO (small business owner),
#unbothered has been used over 800,000 times on Instagram (IG) alone. These “unbothered” individuals post photos, memes and videos showcasing either themselves or others #livingtheirbestlife without a single care in the world. Everyone strives to be #unbothered but might I suggest that actually being #unbothered is opposite of sating or saying that you are #unbothered.
Have you ever heard the saying, “If you have to tell someone how smart you are you probably aren’t”? Well, principally, the same is true for most other qualities including being #unbothered. The very fact that you are telling someone or everyone (if posted on social) that you are good, not worried about it, not trippin’ or #unbothered means that the issue, situation or business is affecting you, which is indeed - bothersome! #sorrynotsorry
Anyone that knows me personally knows that I do not separate the business owner from their person. The same way we claim to be #unbothered about people is the same way we claim to be #unbothered about our business’s competition. Honestly, have you ever been on your social media account and scrolled past a bomb offer, service or product presented by your competition? I feel like we all have at some point. Sometimes we say, “Oh that’s cool, they are doing ____.” Other times we say, “&!@$ they did it first!” or “ *sigh* I should have thought of that”. It’s not that you have ill-will for your competition it’s simply that in this game of business you have to have, find or create an upper hand.
To keep from having those moments of self-pity and claiming a false emotional state, think about two things: 1. How your business attacks strategy, and 2. How your business reacts to changing market conditions. Customer expectations, financial goals, values, and skill and ability levels, influence the moves your business makes. The same is true of your competition. So when it comes to predicting how they will behave in the future, it's important to look at all of the factors that could influence their decisions. Insert Porter’s Four Corners Model, a framework that you can use to analyze your competition and predict their future behavior.
NOTE: This model assumes that you have existing in-depth knowledge about your competition. Learn what you can about them from public sources, and from people who have worked with them, and then make your best guess. If you make too many guesses, though, be aware that your conclusions may be unreliable. Hire a professional (Business Strategist or Business Consultant) to help you if you feel stuck or uncertain.
Figure 1: Porter's Four Corners Model
The four corners of the model represent your competitions Motivation and Actions.
The Motivation corners (“Drivers and Management Assumptions”) are your competitions internal state, i.e. their goals, philosophy, mission, and values. The Actions corners (“Strategy and Capabilities”) show the steps that your competition is taking, which is something you can observe first-hand.
By considering each of the four quadrants (quads) you can anticipate how your competitors might react in a given situation.
Applying the Model
Your first step is to try to understand what your competition’s goals may be and to measure their progress towards achieving these goals. You also need to look closely at their values and their corporate culture.
· Start by looking at the goals that your competitors talk about in published material – for example, on websites, in annual reports, in analysts' reports and in interviews.
· Analyze and better understand your competition’s company culture. How does their culture differ from yours? How does this influence their goals and strategy?
· Look at the owner and their leadership team members. What are their backgrounds? How is their talent and experience likely to influence their goals and overall strategy?
We learn that relying on assumptions, especially in business, may be your downfall. But making educated assumptions based on facts acquired from reliable sources is the very make up of this entire model. This quad encourages you to explore the assumptions that your competitors and their management teams may be making about their own strengths and weaknesses, as well as those of the industry as a whole. You also need to think about the assumptions that your competitors might be making about your business’s goals and strategies.
If your competition believes that other industry payers are strong, then they may have strategies in place to respond to threats. However, if your competition perceives the other industry players to be weak, then they are more than likely to be unprepared to deal with new threats in the industry.
· What do you think they perceive their strengths and weaknesses to be? Have they taken advantage of opportunities to use these strengths in the past?
· How involved are these businesses in the industry? Are they quick to adopt new technologies and best practices? If not, why not?
· What questionable assumptions might they be making about the industry, and about their own strengths and weaknesses? And what opportunities could these flawed assumptions open up for you?
This quad is my fav. Why? Because…. It’s strategy! It encourages you to take a high-level look at your competition’s strategy. Businesses have two strategies: an “ideal” strategy, which can be detailed in a business model, and the “actual” strategy, which is reflected in the business’s actions, namely with new product and/or service releases and with their response to threats.
The goal in this quad is to determine whether your competition is satisfied with how they're currently performing. If their existing strategy is working, then they're unlikely to change it. However, if they're struggling, then it's likely that the owner is developing – or is about to roll out – a new strategy.
· Look at where your competition stands in the industry. How well are they competing?
· Read/watch anything you can on this business including interviews and public statements. Do their actions reflect their goals, or have they followed a different course?
· From this, try to understand what your competition’s actual strategy is – that is, how they will try to win in the market/industry – and think about whether this is likely to be stable, or whether it's likely to change.
This last quad encourages you to look at your competition’s competencies, and their effectiveness. Your competition may want to respond in a certain way, but they might be held back by weaknesses, a lack of resources, or incorrect assumptions.
· Start by listing your competition’s core competencies to identify the competencies that provide real value for your competition. Core competencies can be exceptional customer service, efficiency, customer engagement etc.
· Look at their strategic alliances. Who are they partnered with that might help them respond to a threat?
So Now What?
You have all this data on your competition, what the heck do you do with it? Well, you pull all of this together to think about and determine the following:
How likely they are to achieve their goals
Whether or not they are "finely-oiled machines," perfectly set up for success
How much work they have to do to move forward
If they are positioned to execute their strategy
How are they are going to react to the industry in the future
Being in the ‘know’ is an absolute must for business owners. Yes, it process can be long and tedious but the end results are so worth it. You’re welcome!
Happy assumptions guys!
*Key concepts derived from Mindtools LTD