When it comes to business, competitive advantage is one of the keys that play an important role in business sustainability. A company that has a competitive advantage means that the company is able to provide better or equal service to its customers or services that are offered at a lower price than competitors. Thus, it makes the company superior among other choices of its customers.
Successful companies like Apple, Facebook, and Google already have their own distinct advantages for their customers. However, some other companies still cannot create their advantages to offer. Many of them target the same customers with the same products or services as competitors. It is the perspective that they can do it in a better way.
To create competitive advantage at a higher level, you need to pay attention to these three things:
Target market, where to play and not play
Analyzing the market is vital to determining competitive advantage. In business, a product is not meant to be provided for everyone. Though in fact, it makes perfect sense, right? However, it is important for business people to understand the ideal customer and narrowly focused.
The perspective that the broaden the product range, the more it brings customers which results in higher income needs to be straightened out. Especially for start-ups, the narrower your focus, the greater the advantages it creates. If it is done the other way around, it will weaken the resources which will result in inefficiency. In the long run, it affects your income and position of advantage.
Your team will need to define a target market for defining where to play and most of the part is to define where not to play. It should have the answer of where you shouldn’t enter in terms of market, product and demographics. A good workshop training will help the team to determine. At least, you are confident to answer, are you only participating or competing to gain advantages?
Competence is an expertise, skill set, or focused activity that is the strength. The competency model is used to gain insights on skills in the company both individually and collectively (in teams) which are in line with the company goals.
Indeed, your company has a system of activities or models. However, can you clearly define the model? You also need to conduct regular assessments of the company’s competency model. Although each competency has similarities with the competitors, the competency model in a whole must be distinct as the objectives among the companies are different.
A good competency model can also answer questions about the skills needed to win the market, potential skills that can be developed, and how the skills are applied. In addition, you also need to be aware of the skill gap between now and tomorrow, and whether you need to invest in the development.
Bench strength, determining the company’s culture
Every CEO has a goal to create a healthy corporate climate, a collaborative team, and a high-performance mentality as to be the best company requires a clear bench strength as well. You may need a tool to analyze every employee’s bench strength or performance from top to bottom.
Other assessments to improve the company’s work culture are also needed. One of them is by comparing feedback or descriptions of the company culture from employees with the company culture expected by the CEO. Thus, better company culture is easier to achieve through improving the gaps.
For that, you need to invest in the right business tools for your company. RUN System is an integrated ERP software that can help you simplify operations management in every business process you carry out. The various modules in the RUN System act as instruments to control the implementation of strategic activities in your business.
Find out more about the RUN System and join us!