on Competition: knowing the other players

"As an entrepreneur, if you think that you don't have any competition, then it means one of two things:

  1. What you're working on is not worth working upon or
  2. You don't know how to use Google"

Guy Kawasaki had once told this to Peter Panas and me during a global student business plan competition years ago, after we had just pitched the business plan for Securamed at the Stanford global e-challenge in Singapore. Competitiveness is the essence of any business and you need to know the competition to be competitive.

It must be obvious that you need to know who your present competitors are, but it is even more important to know the following three facets about your competitors:

  1. How will your competition react to your strategies?
  2. What is your strongest point and your competitors' weakest point?
  3. Who is likely to be your competitor in the short term vs the long term?

In this this post, I'll share my thoughts on #1 – proactively predicting the competitor's moves/reactions:
Just knowing the names and basic offerings of your competitors is never enough. Basic information about the obvious competitors is typically very easy to find. If it is a large company it is pretty straight forward to find the basics from the company's website. If the competitor is a public company, then it is even better. For large companies, which are private, you may find the basic information from the Dunn And Bradstreet reports. For large companies, which are publicly listed, most information is available from the EDGAR reports or the annual reports. Hoover's database (easily accessible from any decent library) is also very comprehensive. It starts getting trickier as the size of a competitor starts decreasing. Not only can a smaller company harder to spot, but their strategies/reactions are harder to predict. Most effective small companies are fairly agile and can adapt easily to changing market conditions.

Despite the size of the company, there are two proven ways to learn the most about a competitor.
One, be a customer of the competitor. Eat the competitor's dogfood. Empathize with the experience offered by your competitor to their customers. Use the competitor's product. Talk to their customer support personnel. Post a question on their help forum (if one exists.) I'm not suggesting espionage. There are legal ways of purchasing and using a competitor's products. Don't hide your identity. It is OK to say that you work for your company and disclose who you are. The competitors assume that you know everything about their product, anyway.The goal of this exercise is not to find the good things about a competitor and copy them. The key is in understanding the guiding principles of the competitor's execution strategy. Is the competitor focusing a lot on customer service? Is the competitor's product sold on the merits of its user interface? How has the competitor's product matured over time? Has the backend being made more robust or has the competitor focused more on improving the user interface over time? What are their customers/users liking/disliking about their product (can be found easily through newsgroups/blog posts, etc.)? Buy the best possible version of the competitor's product and renew your service subscriptions. Keep up with the competition as a pro-customer and get a pulse of their business.

Second and most important aspect is to really really know the people involved in the competition. Is the CEO of the competition a strategiest or a people manager? Is he/she a technologist or a marketer or a deal maker? What does the DNA of the competition's leadership look like? Is it dominated by technocrats or sales people? Where have most people worked before (this gives a pretty clear picture of their work-style or their approach?) Who is likely to succeed the current leadership? The goal of this exercise is to really understand how your competition is likely to react, when you execute your strategies. For instance, if you introduce a new product, is the competitor likely to introduce a more technically robust product, or is it likely to strike a deal with another competitor to combat you or is it likely to reduce the price of their offerings. These things can only be found out by investing heavily in understanding the minds of the key leaders at your competitor. All decisions and strategies are implemented by people and not organizations/companies. It is important to be able to understand their value system, their guiding principles and their likely reactions. If you know the likely reaction from a competitor, you can always be prepared for it or even use it to deceive the competition. Data about people, their past experiences and their workstyles can be easily found on LinkedIn/facebook. Be aware that the competitor would also  be trying to sum you up, so control how you project yourself through LinkedIn/facebook/blog posts/replies to newsgroups, etc.

If you play any competitive sport, these things may seem like "common sense", because it is common sense. Remember to use it. Tennis and chess provide a very straightforward way to simulate one:one competitive environment and practice your strategies. My most favorite board game – RISK, is the best way to simulate competition amongst multiple players and try out strategies.

A lot have been written on competition by both academicians and practitioners. Works of Michael Porter and Sun Tzu (The Art of War) remain the most admired. Read these works, if you haven't.

Compete!
-Kintan 

Why I blog?

A friend recently asked me – why I blog? Simple answer - I get to connect with several like-minded people by sharing my thoughts. I've met several folks from around the world who are now my very good friends. Here's one of the recent mails I received from a reader. Messages like this makes it worthwhile to blog and share ideas.

 

Hello Kintan,

I am currently pursuing Masters in Information Management from University of Washington, Seattle. I have been a follower of your blog for a very long time and I really appreciate your taking time out to write about Program Management.

Your blog was one of the reason, I applied for the PM position at Microsoft and I actually crossed the initial screening. I will be on Microsoft Campus very soon for the on site interviewing.

I need your suggestion on designing in particularly "software". I understood the concept of designing the "physical objects" like a kitchen, or a building. But while thinking of designing a software, I wanted to know whether the interviewer means the UML design (like the way it is given in OO Design Patterns by Gang of 4) of the software or something else. And what modifications will you suggest in your "design template" specifically for Software.

Looking forward to your reply.

 

Thanks

-Kintan

back to business after a “think month”

Every year, I set aside some time to "think". Typically, it has been during the month of December, but this year it ended up being the month of October. While throughout the year, mind is always on a relentless pursuit of thought, followed by action, I make conscious efforts to prioritize thoughts, share thinking points with friends/mentors and select three concrete areas to work on.

I've found this process very helpful and in fact addictive over the last six years. Several people I know and respect have been doing it for years. For me, the "think" day/week/month entails three things : 

1. Emptying your mind and organizing all thoughts in the mind: Open up a journal (I prefer paper journal, but OneNote works as well) and write down all thoughts that have been lingering around in the mind – things you've wanted to learn, things that have been bothering you, things that you've wanted to get done, people you've wanted to meet, etc. After listing down all thoughts – sort, bucketize, prioritize these thoughts/themes.

2. Deliberately add new thinking points to the mind: Since our mind is always receiving information/thinking points from a gamut of sources, "think time" is a good opportunity to put a filter on the information sources and seek out to learn more about a few specific topics. Seek out the experts on these topics, read books, read blogs and take notes.

3. Executing: The entire exercise is not worth it, if it is not acted upon. Prioritize three or four themes/areas to focus on, create milestones and action items, between now and the next "think time."

None of these points are new and most of us use this (or an even more complex/scientific process) for work-related projects. I've gotten myself to do several insightfully satisfying things and thereby increase the portfolio of my passions through these "think times". Starting companies, painting, blogging, getting passionately involved in poverty-elimination/Unitus, travelling to specific places, some very close friends – have been results of my past "think times." Pixtoria is one of the results of my most recent "think time".

A wide variety of themes dominated this year's "think month":

  • relationships: family, friends, personal vs professional circle of influence
  • opportunities/industries: unified communications, social networks, mobile, microfinance, healthcare

  • poverty elimination vs environment protection, micro econ vs macro econ
  • living in Seattle vs San Francisco
  • portfolio of passions: painting vs photography, car racing, travelling

I typically don't suspend my regular activities/work during this "think time" (in fact, I try out things that I've been wanting to do for a long time, but haven't gotten a chance to do so – for instance, sky diving, reading books that were on hold for a long time). I don't blog during this time.

The duration of "think time" does not have to be a month, but at least a day or a weekend. It is hard to go in detailed depths, if you don't invest sufficient time. I'll share some of my thinking points during subsequent posts.

let's think!
-Kintan