The next step is to analyze your company's position in the market. The following questions are designed to help you determine whether your company has a competitive edge:
- What does your company do successfully that your competitors don't or can't do?
- What is my company vision?
- Does my vision fit my target market?
- What is my company's strategy and plan for success?
- Do I take advantage of my competitors' weaknesses?
- What have I learned from my competitors' mistakes?
- What have I learned from my competitors' strengths?
- What competitive opportunities exist right now that I can take advantage of?
- Does my company possess a uniqueness that easily separates it from my competitors?
- Would I pay money to do business with my company because of this uniqueness?
- How do my prices compare with the rest of my industry?
- Do I have a loyal customer base? Why are they loyal? Have I validated this competitive advantage through customer feedback and surveys?
- Am I sensitive to my customers' needs and requests?
- Do I have the capabilities and resources to compete in the market five to ten years from now?
A company's competitive advantage largely determines its ability to generate excess returns on capital. In the end, it is a company's competitive advantage that allows it to earn excess returns for its shareholders. Without a competitive advantage, a corporation has limited economic reason to exist--its competitive advantage gives it life. Without it, the corporation will wither away. Creating a sustainable competitive advantage may be the single most important goal of any corporation and may be the most important single attribute on which each corporation must place its focus to weather the storm of competition.
Linda Hanson, CMC, is a certified management consultant and author of 10 Steps to Marketing Success. She writes, speaks and consults on marketing, management and customer service issues and can be contacted at www.llhenterprises.com. Sign up for her free newsletter The Superior Performance Report.