Posted by: Bill von Achen | May 21, 2010

What Separates the Winners from the Rest?

The economic road ahead is surely full of bumps and potholes, but most of the signs indicate that the U.S. economy is on the road to recovery. If your business has survived the past 18-24 months, you’re still here because of a combination of tough decisions, hard work and no small amount of luck. Congratulations!

Now, what are the most important strategy considerations that will help you to survive and prosper as you move forward? And, with buyers still tightly controlling their spending, what steps can you take to distinguish your company’s products and services in the marketplace, and help you to outpace your competitors?

In a recent issue of Forbes Magazine, Publisher Rich Karlgaard takes a look at some of the major U.S. companies that have survived and even prospered in this unique economic environment. From their example, he identifies seven strategy secrets that he believes have the power to turn even ordinary companies into extraordinary performers, regardless of the economy.

Here’s a brief summary of Karlgaard’s seven secrets:

Design: As Apple’s new iPad clearly demonstrates, ground-breaking product design has the power to break through the tsunami of new technology products coming on the market and quickly gain customer loyalists and market share. And the concept of breakthrough design is not limited to consumer electronics companies, but is embodied in other types of businesses as well, such as W Hotels and Virgin Airlines.

Speed: Speed and efficiency can mean the difference between a happy customer, and one who shops elsewhere. Does your website make it easy for customers to painlessly complete their on-line transactions? Do you respond promptly to customer inquiries and technical or service issues regarding your products or services. Do you immediately address complaints as a way to prevent customers from going to another supplier?

Cost: Maybe you can’t compete with the low-cost suppliers in your industry (especially if they’re operating off-shore with rock-bottom labor costs). But you can certainly take steps to lower your own costs of doing business, and pass along some of those savings in the form of lower prices. The first place to look? Examine your internal business processes and see if you can reduce the labor input or streamline the effort.

Service: Service levels are driven by a number of variables, from the standards in your industry to the way that you differentiate yourself from competitors. But the key to making service a secret strategy is to consistently match your levels of service to the expectations that you’ve set for your customers. Karlgaard cites Southwest Airlines as a prime example of a company that shifts key aspects of the service burden to its customers, and makes it a fun experience at the same time.

Outside Communication: At a time when there are so many options available, how do successful businesses choose the communication channels to best reach current and future customers? According to Karlgaard, the place to start the selection process is to ask clarifying questions that help you to identify the fit between your company’s values and those of your customers and stakeholders.

Inside Communication: Just as effective external communication is a key secret strategy, so too is ensuring that everyone within your company gets the same message about what you’re doing and where you’re going. Develop an internal communication strategy now so that all the members of your team can execute your company’s plan with efficiency and precision. And remember, the quality of your internal communication is more important than the quantity.

Purpose: Like author Daniel Pink in his recent best-selling book, Drive, Karlgaard sees purpose as a key driver for successful companies. “The very best companies know why they do what they do,” says Karlgaard. “They have a purpose—a reason for existence that transcends profit. Driven by purpose, they create a movement and consequently get the most discerning and loyal customers.”

You can find a link to Karlgaard’s Forbes column by going to the Resources page of this blog, and looking under the “Strategy” heading.

How do Karlgaard’s seven secrets compare with your strategies for success? Share your thoughts and ideas by commenting on this post.


Responses

  1. Great article. As I just stated on Twitter, this is must read for business owners and senior managers.


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