I’d like to share a quote I read in an article recently. While it’s pretty amusing, I think there’s a good lesson behind it. While sharing this with friends in other industries, the response back that you could have substituted the hot concept from their discipline just as easily.
Here it is:
George Westerman, a research scientist who is studying ERM in relation to information technology at MIT, says that in its current state, ERM reminds him of what someone once said about e-commerce in the 90s: It’s like teenage sex. “Everyone wants to be doing it. Everyone thinks everybody else is doing it. Not many people are actually doing it, and no one is doing it particularly well.”
(Borrowed from Risk’s Rewards, Scott Berinato, CIO.com)
I guess you don’t know how much you don’t know until you learn it. Any way you look at it… it’s good to be a company that is open to finding your own blind spots.
Central to your ability to develop and execute a successful market strategy is your understanding of your value proposition. The value proposition is what you bring to the table, who it’s for and why they should care. It is important to ensure this statement does not leave your customer asking, “So What?”
So, what is your value proposition? Value propositions can be generally classed into one of three types:
It is important to recognize that your company can only focus on differentiation in one of these three areas. It isn’t typically possible to pursue more than one of these as a differentiator. That being said, the other two areas must be performing at a reasonable level. By recognizing your and focusing on your strengths, you will be better able to capitalize on them. Your unique combination of competencies and assets positions you to capitalize on opportunities in a unique way.
Product: These companies focus on product innovation, and lead the market in development. They stay ahead of the pack in terms of what they offer and time to market. Their service levels are typically good, but they lead because of what they bring to the market.
Relationship: Relationship companies focus on delivering high quality service levels, and intimacy with their customer. They deliver by creating customized solutions to meet the needs of the client. They’re probably not the lowest price, but customers that want this level of attention choose them because it addresses a need for this type of service.
Operational: These companies may have an incredible distribution chain, super high quality, or a price their competitors can’t touch. Companies delivering in operational excellence probably don’t lead in product innovation or service but maintain acceptable levels. Companies like Walmart are a good example of operational excellence.
Recognize your unique opporunities to create value in the market, then focus on strengthening your value proposition by getting better at what you do. Play to your strengths.