When a major business initiative – launching a new product, acquisition/merger, entering a new market, starting a new branding/positioning campaign, mounting a competitive response, etc. – fails it is rarely because the numbers didn’t work or financial risk wasn’t properly assessed.
If education, training and professional certifications are a guide, we can assume that financial analysis is a reasonably robust skill set among all medium-to-large companies (and even a lot of smaller ones). According to the National Center for Education Statistics (NCES), American universities have cranked out well over 100,000 new MBAs per year every year since 2000. Every company of any size has one, two, six, or a hundred MBAs peppered throughout the organization, and each of these MBAs has been thoroughly schooled in basic financial analysis. Add in the accountants, CPAs, business analysts, risk managers and, in some cases, mathematics and statistics specialists and you have a solid base for testing and validating the numbers before any new project, initiative or campaign is launched.
Yet the success rate for new initiatives, across industries and markets, remains between 25% and 35% — only slightly better than random luck. Let’s look at some statistics: Continue reading
Ty Beard is a practicing attorney with a very different approach to deal-making, negotiations and the practice of business law. He’s a former history teacher and a military history buff, and came to war gaming as a youth in the 1970s. In this discussion he shares his insight and perspective on how war gaming as a hobby has shaped his strategic approach to business and how the simple techniques he learned as a youth have created significant advantage for his clients. It’s a different perspective on war gaming – one that is very interesting for those pursuing business war games, – and one I think you will find useful.
In this 25-minute conversation you will find: Continue reading
Soren Malmborg is founder and CEO of Copenhagen-based Outcome Business War Games – a consulting firm dedicated to improving negotiation performance through the use of business war gaming.
In this 45-minute conversation with Malmborg and my co-host Sean Murphy you will find: Continue reading
Here is a conversation I had with my colleague Sean Murphy a few days ago. Some of it is tongue-in-cheek but there are real lessons here based on what I’ve seen people do in my 20 years of working inside large and medium corporations. It really comes down to these ideas: Continue reading
Recently McKinsey & Company published an article titled How B2B companies talk past their customers. The article is based on research McKinsey did analyzing the advertising/marketing themes consistently used by major corporations and comparing them with survey results from executives on what the executives consider important in “brand strength.” I've posted an article on the broader findings on my other blog.
But one point in the article stood out for me as being particularly relevant here when I read it – the active, managed use of the sales force as a customer and competitive intelligence collector.
According to McKinsey:
Leading companies make extensive use of frontline interaction and market research to stay in tune with customer needs and perceptions. For example, Hilti, a maker of professional construction tools, has its salespeople do double duty as distributors and hands-on market researchers at customer construction sites.
Notice the description “hands-on market researchers”. This goes well beyond the typical Salesforce.com or CRM data entry that gets turned into forecasts and sales projections, or the ad hoc anecdotes that appear in sales meetings only to be lost in corporate bureaucracy.
What McKinsey is describing is the use of of frontline personnel as an active, managed source of strategic information. Aramark, the national uniform company, does much the same thing, using its drivers to feed its competitive information collection in an organized, structured way.
This type of personal engagement is at the heart of Competitive Management. Having frontline personnel who know what to look for, have an infrastructure that lets them report it in a meaningful way, and feel like what they contribute actually affects company strategy is a real competitive advantage.
Companies like Hilti and Aramark have learned this lesson and use it every day to stay in front of competitiors. What is your company doing? Would you describe your sales force as source of strategic information?
Here is a link to a good description of Discussion vs Dialogue. I found this via the DialogueMapping Yahoo! Group mail list. There are a number of good tips in the article (provided by The Henderson Group) so you should have a look at the link, but here is the description provided at the end:
Dialogue Contrasted With Discussion
Discussion has the same roots as “concussion” and “percussion.” The Latin origin of discuss is “discutere” – to dash or shake apart. Hence, to discuss is to shake apart what others say.
In a discussion we break things down, fragment the whole, analyze the pieces, and seek to convince others of our insights. You recognize discussion by its competitive nature. If you are only listening in order to prepare your own counter-arguments, you are involved in a discussion.
Defaulting to Discussion
Often the default in business conversations, is discussion. Each side will lob its viewpoint across the table. The other will then repeat its counter-position. You have a sense of positions being smacked back and forth like a puck in a hockey game.
If your trust of the others involved diminishes along with your patience and good will, you are likely in discussion.
There are a lot of ways you can structure dialogue. One way we use a lot in Competitive Thinking is the Business War Game, where each participant group provides not only a position statement but also must provide relevant factual backup and reasoning. In this way the tendency to deconstruct or counter an argument is minimized and the focus is on the validity and applicability of the underlying reasoning.
Today I attended an Intelligence Collaborative webinar by Fred Wergeles (pronounced wur’-guh-lees) on Competitor Response Modeling.
Fred did an outstanding job. This is the first time I’ve heard him speak. He presented a simple, four-step process and a four-part framework for finding the necessary information.
I really like this approach. This is the kind of tool and technique anyone can understand and use. Too often Competitive Intelligence (CI) professionals over-complicate things, making it difficult for a layperson to grasp the usefulness of what is being presented. For me, simple is better because I believe that Competitive Thinking is something everyone should do, and the techniques need to be useful in everyday situations for that to happen.
In the next few days Fred’s presentation should be available on SlideShare if you do a search for intelcollab. It may also appear on the Intelligence Collaborative website. I do not know if the presentation was recorded – some are and some aren’t. Either way, I will be breaking down Fred’s method and posting my own take on it in the next few days.
Click this link if video player does not open.
No. 3 in the Getting Started series.
This article is a transcript (with slides) of the video.
If you’re a manager or executive then you earn your paycheck by making decisions. Most of us believe we’re good, if not excellent, decision makers. We base this assessment on several things, most of which equate to some measure of how often we’re right vs. wrong. Today I want to show you a different way of looking at decisions, one that I believe can help you assess what’s going on in your business.
Decision making is an important part of Competitive Thinking, and over time we will look at them from several different perspectives. Today I’d like to show you a framework that breaks business decisions into four major types and illustrates why they are important. I believe you can use this model to assess your decision-making and gain some valuable insight into what’s happening in your business.
Before we start keep in mind that this framework applies equally from line managers all the way up to senior executives. The details and scope of decisions may vary, but the underlying structure is the same. Continue reading
Click this link to view video if player does not load.
No. 2 in the Getting Started Series.
This article is a transcript (with slides) of the video.
One of the fundamentals of Competitive Thinking is to only spend resources – time, effort, money – on things that are relevant to your business. This may seem like common sense but it’s surprising how much effort is expended on things that are no longer relevant, just because they’ve always been done.
So Rule No. 1 is Focus on what is relevant. Continue reading
The words complex and complicated are often used interchangeably. Both refer to things with lots of parts, and both can refer to things that are difficult to understand. But in Competitive Thinking we use the words differently, and the different meanings are important.
We rely on complicated systems every day, for some of our most basic needs. Think of a mechanical clock or analog wristwatch, or the engine in your fuel-efficient hybrid car, or maybe the hard disk drive in your laptop. Continue reading