The first 18 months of the Pandemic was a relentless assault on many people’s resilience and energy levels. For business owners it has been a huge challenge and sadly for some it has dealt a knockout blow.
But let’s be honest, if running a business was easy, everyone would be doing it!
Whilst this was an extreme event, the fundamentals of running a successful business remained the same, and successful business owners attacked this challenge like any other.
Market drivers
Markets rarely afford you the opportunity to rest on your laurels. The key to remaining competitive is knowing the key drivers of demand in your marketplace and developing and positioning products and services accordingly.
That is true in the good times but even more relevant in difficult times. Those businesses that react to changes in customer buying habits, are always looking to innovate new products and services, and watch closely what everyone else was doing to use the best ideas, will succeed. Those that simply keep doing what they have always done, struggled.
Customer focus
Successful businesses know their customers, understand their present needs, and successfully anticipate their future needs. Customers and clients become partners with the business, aiming to work together to deliver value. In the best businesses, customer satisfaction is constantly measured and complaints and suggestions taken seriously.
Leading edge businesses strive not to meet their customers’ expectations, but to exceed them. At the very least, this means excelling on quality, service, and price, and always in that order.
If the focus is on the best customers that recognise and appreciate quality and great service, then the price becomes simply the amount paid to get that. If the business gets drawn into focusing on the wrong end of the customer list, price becomes the driving factor, and maintaining quality and service and still making a profit, becomes impossible.
Innovation
There is no doubt that the businesses that reacted fastest to the Pandemic have done better than those slower to act. Developing new ways to communicate with customers, new products and services, and looking at all the processes to streamline service and cut waste, has really separated the best from the worst in business.
Looking forward, this means:
- Create a culture that encourages and rewards innovation. Train people to ‘have a go’, or throw out ideas, rather than telling them simply to focus on the task in front of them.
- The process is continuous. When you introduce a new product or service, make sure your team are already working on the next one.
- Keep one eye on new technologies, developments in legislation, etc. and learn to exploit them to gain a competitive edge. Have a way of keeping tabs on what is going on in your industry.
- Constantly strive to improve speed to market. The shorter the time between, ‘good idea’ and ‘product on the shelf’ the more successful you will be.
- Hold the fireworks! If new developments or products are released with a loud bang and a big flash, others will copy you. Take it to customers’ first, prospects second, the rest of the world last.
To drive innovation, you need a constant stream of ideas:
- Listen to your customers – their complaints as much as their suggestions.
- Talk to your suppliers about their future developments.
- Monitor your competitors’ future plans.
- Encourage your employees, especially those in direct contact with customers or clients, to suggest innovations.
- Facilitate public visits to your premises and listen to the feedback.
- Visit other businesses, even those in different sectors, to encourage lateral thinking.
Know your competitors
One thing is certain – if you are successful in developing products or services that delight your customers or clients, competitors will appear like stars on a clear night (hence no fireworks!) You will need to become better at monitoring your competitors and anticipating their next moves.
First make sure you know who your competitors are:
- Direct competitors – businesses that compete with you head to head.
- Indirect competitors – for example, a nightclub that might tempt customers away from your restaurant, or anyone else after the same customer spending you are.
- Potential competitors – usually those above or below you in the supply chain that want to expand their offer.
Assign people to monitor them constantly, and gather as much information on their activities as possible.
SWOT the competition
A useful tool for staying ahead of your competitors is a SWOT (Strengths, Weaknesses, Opportunities, Threats) analysis. First analyse your competitors’ strengths and weaknesses in areas such as price, added value, customer service, location, management expertise, reputation, convenience, skills base, advertising, and marketing, and compare them with your own. Try to find ways to turn their weaknesses into your strengths.
Then look at how well placed they are to respond to various threats and opportunities. These are usually factors outside their control such as developments in technology, changes in legislation, or new entrants into the marketplace. Look for ways to turn their threats into your opportunities.
Never take your eye off the ball (or should I say, off your opponent) as far as your competitors are concerned – and never underestimate their potential to beat you to the punch. Whether you are watching them or not, you can be sure they have rolled up their sleeves and are watching you!
The pandemic polarized business between those that looked up, assessed the situation, develop a plan to tackle the challenges and then acted swiftly, from those whose heads dropped and who waited for things to get better.
Those skills and attributes don’t just apply in crisis. A good business is always keeping their eyes open for the next problem, or the next opportunity. They have a culture of constant change and improvement, and they have good intelligence about what is going on around them.
Are you going to get up off the canvas and put your gloves back up, or just lay down and wait for the count to finish?