Regardless of how long you’ve been in business or what position you hold, if you want to thrive in our or any industry, your understanding of market dynamics will determine your present and future success. As such, companies that really understand their markets are leaders who consistently explore the future, while excelling at, leveraging and exploiting the present.
They do this by, amongst other things, cultivating a culture of innovation and execution and competing with a truly differentiated business model that transcends the traditional me-too models that permeate our industry.
Much like a beautiful dance and dancers, they take specific and unique steps that, once mastered, keep their organizations nimble and poised for sustainable growth. They place themselves in the spotlight, which distances them from competition. The market turns their attention and dollars to these well-orchestrated companies.
More than a two-step, these leaders generally follow a seven-step path. These steps are the results of analyzing the following issues and finding the unique solution for their companies:
- Switching costs or switching barriers. Leaders who address switching costs move their companies from “nothing prevents my customers from going to my competitors” to “my customers are in lockstep with us for several years.”
- Recurring revenue. Companies that move from 100% one-and-done transactions to 100% recurring and flowing revenue streams create a sustainable financial base for the future.
- Earning versus spending focus. Focusing on earnings versus spendings by pivoting from incurring 100% of costs before earning revenues to earning 100% of revenues before spending a penny on cost of goods sold is another step successful leaders take.
- Supply chain. Taking bold steps to collaborate with supply chain partners can result in game-changing cost structures that are 30% or lower than competitors to further differentiate the company.
- Cost-sharing. Rather than assume all the costs for a product or service, successful business leaders work with business partners to shift and share costs equitably, which creates harmonious and trusted business partnerships.
- Scalability. Enhancing the organization’s capacity to adapt to increased workload or market demands is an important step in the dance of sustainable success.
- Business model. Business leaders can protect their organizations from competition and position their companies for ongoing success and growth by addressing the previous six steps in the business model that reflect the unique attributes of their market, consumers, business partners and workforce.
Leaders who have taken these steps to move away from the frightful position of “I have no barriers, uniqueness or moves that my competition can’t duplicate” to that envious “mic-drop — go ahead, let me see whatcha got” move!
Judith M. Guido is the chairwoman and founder of Guido & Associates, a business management consulting firm in the erosion control and green industry. Guido can be reached at 818.800.0135 or judy@guidoassoc.com.
