Posts Tagged ‘competition’

Brilliant Manoeuvre
Disable your opponent’s centre of gravity–his unique source of balance and strength–and do so quickly and with resolve when you have a window of opportunity.

Discussion
Whatever you make think of the overall political and strategic rationale, the US-led invasion of Iraq in early 2003 is a textbook case of attacking when the time is right even though you aren’t fully ‘ready.’ Coalition forces invaded Iraq with lightning speed and continually kept the Iraqi forces reeling. The offensive had so much momentum that there was barely time to assemble and process prisoners. American forces headed almost straight for Baghdad–the strategic objective–and didn’t waste time with sidefights and securing flanks. This is also exactly how the German invasion of France in 1940 played out. The Germans headed straight for the Channel coast in order to cut off the bulk of French mobile forces that had moved forward into Belgium where they expected the bulk of the German army to attack.

Tip
These historical military examples show that there are occasions when boldness and speed can more than make up for uncertainty, relative weakness, and lack of resources. They also demonstrate that you have to aim for the centre of gravity to disable it as quickly as possible. Whether you’re in sales, product development, procurement, etc., the best objective is to attack your opponent’s or your problem’s centre of gravity quickly and directly.

Richard Martin is a consultant, speaker, and executive coach. He brings his military and business leadership and management experience to bear for executives and organizations seeking to exploit change, maximize opportunity, and minimize risk.

© 2013 Richard Martin. Reproduction and quotes are permitted with proper attribution.

Brilliant Manoeuvre
Intelligence is everyone’s business.

Discussion
Often, the best intelligence comes from ‘troops in contact’ with the enemy. They can see what’s happening and can provide ‘ground truth’ to corroborate or validate the opinions and assessments made through the intelligence estimation process. The same applies in business. All companies, even small ones, have sales people, customer service agents, and field service reps out in the marketplace. They can see things and hear things that might be highly significant from a competitive standpoint. They need to know and understand the company’s basic strategy, vision, mission and goals, as well as those of their own unit or division. Managers and supervisors must also brief them and debrief them on a regular basis to ensure that they are aware of the latest developments and goals, and so they can bring back critical competitive intelligence.

Tip
Managers and employees have to be on the lookout for opportunities and threats. They are the eyes and ears of the entire company, not just their own little part of it.

© 2013 Richard Martin. Reproduction and quotes are permitted with proper attribution.

Brilliant Manoeuvre
Never assume you’re completely right about your enemy (or competitors)… nor completely wrong either.

Discussion
Warren Buffett, CEO and principal shareowner of Berkshire Hathaway just presided over his company’s annual meeting of shareholders. According to this morning’s Wall Street Journal, Buffett took the outstanding step of inviting a well-known investor who’s selling Berkshire’s stock short. Buffett’s point from this, apart from the obvious newsworthiness, is that he likes to seek contrary opinions. His main message according to the WSJ? Doubt yourself. Of course he doesn’t mean to lack faith in one’s means. Rather, he says to question your own certainties. This is a highly developed approach to management and leadership. Whether in war or business, the biggest mistakes come from irrational belief in the correctness of one’s progostications. It takes a big person to consider contrary opinions and views. Buffett’s success as an investor shows that this is a very prudent and wise thing to do.

Questions
What competitive threats are you facing? What capabilities do your competitors have? Can you estimate their intentions? Do you have advisors who systematically question your assumptions and provide a contrary point of view?

Richard Martin is a consultant, speaker, and executive coach. He brings his military and business leadership and management experience to bear for executives and organizations seeking to exploit change, maximize opportunity, and minimize risk.

© 2013 Richard Martin. Reproduction and quotes are permitted with proper attribution.

In his book, Ignorance: How it drives science, biochemist Stuart Firestein starts by quoting an old proverb, “It is very difficult to find a black cat in a dark room,” and adds “especially when there is no cat.”

Firestein notes that the pursuit of science appears to non-scientists as a very rational and systematic approach to discovery. In actuality, it’s much more like that old proverb than walking down a well-lighted path. The truth is that scientists have to explore many false paths and grope around in the dark room, hoping to find that black cat. But the dark room can be huge, and even endless, and there is no guarantee that there is even a cat in there.

I find that many things about business are very similar. We don’t know ahead of time if our new product ideas will work. Will customers respond the way we anticipate? Will competitors beat us to the punch? Will we be able to deliver on our promises? We can make assumptions about all of this, but that is just what they are, assumptions.

As I pointed out in my book, Brilliant Manoeuvres, assumptions must be validated and tested. Military strategy and tactics provide one model of the application of trial and error to discovery and success. But science also provides a useful model and template. As pointed out by philosopher Karl Popper, science is really a series of conjectures and refutations about the nature of the world and how it works. For instance, in physics, theorists propose new models of the world and experimentalists test them. Theories and hypotheses that have little or no empirical validation are cast aside in favour of those with experimental evidence. This process continues over and over until progress is achieved in understanding reality.

The same process applies in business. Innovation, whether new products and services, new markets, or new internal processes, is nothing but a form of conjecture about what will work in the real world of business. The marketplace is the crucible of experimentation that seeks empirical evidence to demonstrate that the conjecture is correct. Correct business models and innovations are successful to the extent that customers accept them.

Call it a form of un-natural selection. Companies and entrepreneurs put forth ideas based on their understanding of the market and competition, and then they are proved by the test of business success.

To carry this analogy further, businesses must apply the basic principles of innovation and trial and error experimentation.

•    A mechanism to generate new ideas. These can be innovative products and services, or they can also be new ways of viewing the market. For instance, before Henry Ford imagined the Model T, he was driven by the vision of automobiles for every average American family. Prior to the Model T, cars were hand-made toys for the rich. Henry Ford’s innovations explored new manufacturing techniques in order to make his car available to a market that up to then had been essentially ignored.

•    This generation mechanism must be wide-ranging and non-censoring. The perfect model for this is of course brainstorming, where you simply throw out ideas without initial regard for their apparent reasonability or feasibility. In fact, the more ideas appear initially irrational or unfeasible, the better they might be at disrupting the status quo, both internally and externally.

•    Good ideas can (and should) come from all levels and areas of the business. As an example, customer service agents and field service representatives often know more about customer concerns and suggestions for improvements than anyone else in the company. Sales people usually know what the competition is doing. Suppliers and distributors can often provide advance warning of changes in the marketplace and competition. These sources of ideas must be nurtured, encouraged and exploited.

•    Innovations can be external and internal. By this I mean that good ideas don’t just translate directly into new or improved products, services, or markets. It can be someone suggesting a new internal procedure that saves time and money. Or a production manager who finds a potential new supplier at lower cost for equivalent quality. In other words, everything is subject to innovation.

•    Selection should be reality based. Too often ideas are rejected or put out of bounds because ‘that’s not how we do things around here,’ or ‘that’s never worked before,’ or even, ‘because I said so.’ The latter is probably the worst one, but I’ve observed this type of innovation selection by fiat and nothing is more stultifying of growth and continuous improvement. The only truly effective selection mechanism is successful implementation in the external and internal competitive and organizational marketplace.

This is why I advocate trial and error in innovation and change management. No one can predict the future, what will work or not, before it is actually tried. For this reason, we need to find ways to try different ideas and approaches while managing the associated risk. What have you tried lately that is new and innovative?

© Alcera Consulting Inc. 2013. We encourage the sharing of this information and forwarding of this email with attribution. All other rights reserved.

Data was published yesterday that PC sales are plummeting throughout the world.

It is obviously a result of a move to mobile communications and computing. Most people don’t need a powerful desktop or laptop computer for everyday tasks. Email, messaging, reading news, talking on the phone or through video conferencing, scheduling activities, budgeting, etc., they can all be done on mobile devices. Even the occasional memo or report can be produced on a tablet.

With the rise of ubiquitous voice recognition, artificial intelligence, and cloud based services, there is really a limited market for desktop computing. What we’re seeing is the realization of universal computing machines that can act as a multitude of useful devices. Most people can get by in their personal and professional lives without a dedicated computer.

There are still mainframe computers, but they are now highly specialized or focused on truly high powered applications. The desktop computing model will remain, but it will be increasingly marginalized to specialized applications and uses. Everything else will be mobile, always online, multimedia and multichannel, with embedded specialized AIs and interaction facilitators such as voice dictation, field of vision tracking, and various other forms of man-machine interfaces.

Microsoft, Dell, HP, etc., they all have business models that rely heavily on the desktop computing model. They’re trying to make the transition to cloud computing, mobile interactive online living, and various other manifestations of the universal computing machine model. But, it’s not easy.

This just shows how even the most successful companies can see their business models undermined. The only way to overcome this is to shape the future yourself. To take the initiative and to try to create the new business models, rather than just react to them. Microsoft, for instance, has been singularly unsuccessful at adapting to, and shaping, new business models. The company was highly successful at riding the wave of democratization and decentralization of computing, and even created it to a large extent by offering cheap and reasonably effective and usable operating systems and productivity software. But then it just stopped really innovating.

There are only a handful of companies that have operated in highly changing competitive markets that have been able to evolve and adapt, and even shape the changes around them. IBM is one, HP in its previous incarnations was another. Who will be able to adapt to, and shape the future business environments? Who will have the offensive mindset to seize and maintain the initiative? I’ve written about this extensively in my book, Brilliant Manoeuvres: How to Use Military Wisdom to Win Business Battles.

© 2013 Richard Martin. Reproduction and quotes permitted with full and proper attribution.

 

The more I work to bring military wisdom to businesses and executives, the more I see the power of mission analysis in action. In fact, I find this so important, that this month’s newsletter is adapted from my book, Brilliant Manoeuvres: How to Use Military Wisdom to Win Business Battles. I want to offer this powerful tool of motivation and alignment so as many people as possible can benefit.

In standard military terms, a mission is a clear, concise statement of the task of the unit and its purpose. The interesting thing though is that the mission doesn’t come directly from the superior commander’s orders, but rather as the result of a process of analysis by the subordinate commander. The easiest way to apply mission analysis in business is to answer the following questions.

  1. What are the vision, mission, and intent of the whole organization?
  2. What are my immediate superior’s vision, mission, intent, and concept of operations for our part of the organization?
  3. What explicit tasks, roles, and functions within the greater concept of operations has my immediate superior given me?
  4. Are there implied tasks that are required to support these assigned tasks?
  5. What are the limitations on my freedom of action? In other words, are there constraints (musts) and restraints (must not’s) I must follow?
  6. What can I observe, infer, and assume from the foregoing?
  7. What is the most concise statement of my mission?
  8. How has the situation evolved since the last time I answered these questions? Has it changed, or is it similar to the previous round of analysis?

From these questions, anybody can formulate a mission that fits into the bigger picture of the organization they are part of. In other words, you can’t formulate your mission statement and make your own plan of action, statement of intent and end state, without first determining how you fit into the puzzle.

To illustrate the application of mission analysis to business, let’s imagine that you are a sales manager with a small manufacturer of custom packaging for cosmetics and generic pharmaceuticals. The packaging is similar for both types of products as are the suppliers, production, and warehousing. The sales and distribution channels are completely different as are the nature of the buyers, marketing, merchandising, and promotion. The CEO, also the company’s majority shareholder, wants to double the company’s size within four years, expanding the customer base to all of North America from its current concentration in eastern Canada and New England. The vision is to become a leading producer of quality packaging for the entire pharmaceuticals and cosmetics industries in all of North America. The new strategy entails an expansion from generic pharmaceuticals manufacturers to all pharmaceuticals companies, particularly those providing over-the-counter drugs because it’s felt that the packaging is similar to that of cosmetics. There are also many similarities in distribution and merchandising. The company’s mission, therefore, is to provide integrated, quality packaging solutions at reasonable cost for the pharmaceuticals and cosmetics manufacturers in all of North America. It will do this by providing a complete packaging solution. All the pharmaceutical or cosmetic manufacturer need do is ship the product to the company’s facilities and it will do the rest, including sourcing inputs, designing the packaging and instructions, doing the packing and warehousing, shipping to distributors, etc. In other words, they are aiming to provide an end-to-end solution for manufacturers of generic pharmaceuticals and cosmetics.

The senior team has developed a strategy based on three major business thrusts: grow the pharmaceuticals business; grow the cosmetics business; grow the capabilities to provide end-to-end packaging solutions to these customer groups. The company has traditionally had only one sales team, but with the new strategy, the CEO decided to split the company into three groups to focus on each thrust. There is therefore a VP for each of Pharmaceuticals, Cosmetics, and Operations, and each has been given wide freedom of action to execute the strategy within his or her area. You are now part of the pharmaceuticals group, responsible for developing the over-the-counter drug segment. VP Pharmaceuticals’ intent and concept are shown in the table below, as is your mission analysis.

1.    CEO’s vision and intent
Vision: Become a leading producer of high quality packaging for pharmaceuticals and cosmetics manufacturers in all of North America
Objective: Double size within four years and expand customer base to all of North America from current concentration in Eastern Canada and New England.
Mission: Provide integrated high quality packaging solutions at reasonable cost for both markets.
Concept: Provide an end-to-end solution for manufacturers of pharmaceuticals and cosmetics. Separate sales groups with one production and operations group servicing sales in both markets. Use mass customization approach for tailored customer solutions while optimizing efficiencies and economies of scale.

2.    VP Pharma’s intent and concept of operations
Vision: Preferred supplier of integrated packaging solutions for all major pharma manufacturers in North America wanting high quality packaging.
Objectives: Maintain generic pharma clients; reach all OTC drugs manufacturers as customers within 2 years; reach all other pharma manufacturers within 4 years.
Mission/Intent: Provide integrated packaging solutions so the pharma manufacturers can focus on developing and marketing their products, and not worry about packaging logistics.
Concept: Three sales teams focusing on three distinct client groups; generic sales team to expand to North America; create OTC sales team and build on existing client relationships in current clients to offer OTC packaging solutions, then extend to other companies; expand from OTC clients into other areas of pharma manufacturers and build sales team for proprietary pharma manufacturers as required.

3.    Assigned tasks
Develop the OTC manufacturers clientele.

4.    Implied tasks
Build a sales team; leverage existing relationships in generic pharma companies that also have OTC products; lay the groundwork to extend the same model to pharma companies that focus on proprietary drugs.

5.    Limitations
Must reach all OTC manufacturers within 2 years and all other pharma companies with OTC products within 4 years. Can go faster as opportunities arise.

6.    Observations, inferences, and assumptions
I infer from the foregoing analysis that the OTC sales effort is the critical one for the company, because it provides the bridge from existing relationships in current generic drug manufacturers to all other pharma companies. While OTC clients will be a major revenue source in and of themselves, the companies with proprietary pharmaceuticals form the bulk of the sector and that is where our company’s major future growth will come from. I therefore assume that the OTC sales team will be a priority for growth and resourcing over the next 2 years.

7.    Mission statement
Our mission is to expand existing client relationships in generic pharma to OTC drugs with a view to transferring this expertise to the proprietary pharmaceuticals manufacturers, first through OTC products, and then in support of all their other pharmaceutical products.

8.    Has the situation changed?
As the situation evolves in the next few years, you sit down with your team on a regular basis, or as needed, and redo this mission analysis to confirm that you’re still on the right track.

This notional illustration of mission analysis leads to a few critical observations. The first is that mission analysis is a dynamic process. Whether it is at the corporate, divisional, or team levels, the situation must be constantly assessed to determine whether the mission and goals are still relevant and, more importantly, still within the bounds of the superior manager’s intent and concept of operations. The second point is that the mission statement for any particular executive and sub-organization tends to flow of necessity from the analysis. Once the first five steps of the process have been done, the mission statement tends to be obvious. The final and most important point is that mission analysis is the glue that holds the whole framework of nested hierarchical planning together. Mission analysis enables managers and employees at all levels of the organization, no matter what their role or tasks, to fit into the big picture and know their mission. This empowers everyone to exercise initiative to achieve the vision and mission of the organization.

© Alcera Consulting Inc. 2013. We encourage the sharing of this information and forwarding of this email with attribution. All other rights reserved.

Brilliant Manoeuvre
Sometimes you have to move to make things happen and to confirm your initial estimations. Superficial impressions are often just that, superficial. Only probing and action can uncover opportunities and openings.

Example
I’m working with one of my clients to get his managers and employees to take prudent risks, to make a move to provoke a response, and to not just accept the initial framing of an opportunity or problem. Case in point: They have to decide whether to approach a prospect or to respond to a RFP. This often leads to dithering and worries amongst the staff about whether they feel they have the full capabilities to fulfill the mandate or whether it’s worth their time and effort as currently defined. The aim should instead be to reach out to the prospect and to make contact in some way, even if to challenge the specifications in the RFP or to push back on the customer’s claimed needs and wants. In this way, they can work their way to the true buyer and start developing a relationship. After all, most businesses depend on some form of trusting relationship between buyers and sellers. Once a relationship is initiated, it can be further developed and can lead to new possibilities. If you stay hunkered down in your fortress you can’t see what’s happening out in the real world. You need to test your assumptions and beliefs about competitors, customers, other stakeholders, by trying them in the actual game.

Tip
The aim isn’t to know everything, as that is impossible, but rather to know more than competitors so as to gain the upper hand and move faster.

Richard Martin is a consultant, speaker, and executive coach. He brings his military and business leadership and management experience to bear for executives and organizations seeking to exploit change, maximize opportunity, and minimize risk.

© 2013 Richard Martin. Reproduction and quotes are permitted with proper attribution.

Brilliant Manoeuvre
Let your competitors focus on their existing customers and products. That creates opportunities for you to manoeuvre around them.

Example
In the 1950s, Fairchild Semiconductor left the vacuum tube manufacturers to focus on their existing customer applications such as TVs and radios and went after the more demanding and much more lucrative defense and space applications markets with their solid state transistors and integrated circuits. Canadair (and then Bombardier Aerospace) didn’t try to build major jetliners but instead went into businness jets, water bombers, and small regional jetliners. Microsoft didn’t try to go directly up againt the IBMs and didn’t get into hardware, but instead offered low cost, reasonably effective operating systems and applications to individual users and small businesses. Google initially just offered search based ads to advertisers, leaving mass media companies to continue focusing on large accounts. Apple left the corporate and institutional markets to Research in Motion when it introduced the iPhone and went after the consumer market.

Tip
Use your competitors strengths against them.

Richard Martin is a consultant, speaker, and executive coach. He brings his military and business leadership and management experience to bear for executives and organizations seeking to exploit change, maximize opportunity, and minimize risk.

© 2013 Richard Martin. Reproduction and quotes are permitted with proper attribution.

Brilliant Manoeuvre
Use technology to move faster and make decisions faster than competitors.

Example
Technology has always been a key factor in warfare. The side that is better able to exploit a new technology and do so faster and in greater numbers than potential or actual enemies will tend to prevail. The same applies in business. Technology is evolving at an accelerating rate. Visionary inventor and entrepreneur Ray Kurzweil calls this phenomenon the Law of Accelerating Returns. As an example, the speed and quality of genome sequencing basically doubles every year while the cost continues to drop rapidly. IBM’s Watson supercomputer, which last year won Jeopardy by beating the two best ever human competitors (with a score that surpassed their combined scores), is now being turned by IBM to the development of AI-based medical diagnosis. It is conceivable that within a few years we will have access to our own medical records and biometric information in a continual manner as well as near instant health monitoring and diagnosis. How will this change medical and healthcare practice? What does this mean for doctors, nurses, hospitals, pharmacies, pharma companies, and health and life insurance companies? If I were in these fields, I would be developing scenarios and finding ways to be at the forefront of technology and innovation so I could be in a better position to preempt competitors and occupy the rich economic terrain that will open up. I would be actively looking at the impact of technologies in all fields, even outside of my own, because new threats may arise or, more important, new opportunities WILL arise. I would want to be on the winning side by setting the conditions and shaping the battlefield to my advantage.

Tip
Be on the lookout for evolving technologies in all spheres of endeavour and seek ways to incorporate them into your business or to leverage them for competitive and strategic advantage.

Richard Martin is a consultant, speaker, and executive coach. He brings his military and business leadership and management experience to bear for executives and organizations seeking to exploit change, maximize opportunity, and minimize risk.

© 2013 Richard Martin. Reproduction and quotes are permitted with proper attribution.

Brilliant Manoeuvre
The first and most important principle of war, and the only sure road to victory, is offense. Defense should only be used as a temporary measure while doing everything possible to (re)gain the initiative.

Examples
Too many companies (and even entire business sectors) have lost their relevance by assuming that their existing defensive posture would protect them from competition. Newspapers have been rendered almost irrelevant by web based media. The music industry was completely bypassed, first by Napster and other illegal copying methods, and then legally by iTunes. Television networks are struggling against the same reality, trying desperately to protect their control over programming, while teenagers barely watch TV anymore, preferring to watch their favourite shows on the web. Research in Motion (now Blackberry) thought its position in secure mobile communications made it invulnerable. When the iPhone came out, one of RIM’s co-CEOs pronounced it insignificant (or words to that effect). On the other hand, companies such as IBM, Bombardier, and Disney have continually reinvented themselves, or redefined their purpose in order to seek out and/or create new market positions. This keeps them ahead of competitors, and in some cases makes the competitors irrelevant.

Tip
Offensive business strategy succeeds best when companies make small, probing advances, experimenting with new products, services, processes, and business models. Once they see a successful incursion, they pour resources ‘into the breach’ in the hope of turning it into a breakthrough.

Richard Martin is a consultant, speaker, and executive coach. He brings his military and business leadership and management experience to bear for executives and organizations seeking to exploit change, maximize opportunity, and minimize risk.

© 2013 Richard Martin. Reproduction and quotes are permitted with proper attribution.