Market intelligence is one of the cornerstones of leading a business. Clearly understanding the motivations and goals of your competitors can lead to insights into how they’ll make future decisions. This can allow you to position your company for the best chance of success.
But, your competitors aren’t you. Even very similar companies in the same market segment have unique challenges and strengths that influence their relative opportunities and threats. Putting too much focus on what the competitors are doing can put your company into a reactionary cycle rather than making your own path.
Below are two things the leadership at Gro Alliance does to make sure we are focused on our own goals versus those of others.
Vision and Mission Statements Need to be Meaningful
It’s common for a company’s leadership to put in real work on vision and mission statements. It’s also common for those same companies to never refer back to them or revise them. Make sure that hard work is relevant by reviewing those statements at least annually. Further, big company decisions need to be viewed through the lens of those statements. Ask if your next move aligns with the vision and mission statements. If it does, move forward; if not, then you may be reacting to the news of the day or a temporary market moment.
Is The Decision Right for Today and for 10 Years from Now?
Business decisions should always be made with the idea that the company will exist in perpetuity. There are so many examples of company decisions that are designed to produce outstanding short-term results but carry unintended negative long-term impacts. This is most common are when a company plans to IPO, raise additional private capital or transition ownership. I call these events ‘sugar highs’ since the company gets a short term burst and then crashes after the stimulant wears off and the desired exits don’t occur.
Some of the riskiest sugar highs are those done for defensive purposes: events like major discounting to hold customers, aggressive hiring to defend a sales territory or a major capital outlay in hopes of retaining market share. These decisions can destabilize the business if they aren’t made with the long-term view in mind.
Huddling up company leadership to review the competitive landscape is a critical element of business planning. The output of those discussions, however, needs to laser-focused on how to best move your own company forward versus reacting to the moves of the competition. If you are making decisions just to counter another company’s strategy, you’re actually being led by their leadership team’s decisions and not your own.
