Essential Tips for Doing Competitive Analysis

For anyone trying to grow a business, one of the first tasks is to map the competitive landscape. With a good understanding of the competition facing your company, you'll be able to spot and exploit opportunities as they develop. These dozen points should help you draw and refine your map, beginning with your earliest efforts to plan your new venture and continuing for as long as you stay in business.

1) Be a customer. Bring a notepad and pencil to competing establishments and ask a lot of questions. Testing a firm's ability to serve you will reveal much about their business. And don't just pretend to shop from competitors. Buy something. It's the only way to gain first-hand experience with the company's products and services.

2) Find out as much as you can about the people who run competing businesses. Where did they go to school? Where have they worked? How long have they been in the business? What are their strengths and weaknesses? This information can help you anticipate your competition's moves. For example, a local, life-long farmer will run an Indiana seed company very differently than will a young MBA.

3) Buy stock in your competitors. If you're competing against a publicly traded firm, consider buying a few shares of its stock. That way you'll receive regular updates on the firm's financial results and business strategies.

4) Talk to your competitors' customers. Why do they buy from your competitors? Is it because of the quality of the product or service, the price, the location, or the customer support? What do they dislike about the company? What do they wish that company would provide? Why don't they buy from you?

5) Use the Internet. Online services such as Dow Jones Interactive allow you to search through thousands of publications for information about your competitors, especially if they include large companies. Searches are free, but you'll have to pay a fee for articles on Dow Jones or for a monthly subscription. You also can learn a great deal about competing businesses simply by going to their Web sites.

6) Check public filings. As an entrepreneur, you already know that companies must disclose information to government agencies. Such disclosures are required to undertake public offerings, receive building permits, register for patents or trademarks and so on. Many of those filings are public record and contain information about the company's goals, strategies, and technologies.

7) Get to know local librarians. Many are virtuoso researchers and can save you a great deal of time and effort. Your library also will have local publications that may have information on competitors in your area.

8) Attend industry conferences and trade shows. Your competitors' representatives will be pounding their chests about their firms' products or services. Take advantage of the opportunity to familiarize yourself with their product offerings and strategies, and how they sell themselves.

9) Assess the competition's goals. A competitor trying to increase its market share might lower prices; a firm attempting to increase profits may cut costs; and a business that wants to accelerate sales growth might kick off a marketing campaign. If you know your competitors' goals, you'll be better able to anticipate their strategies.

10) Be aware of the potential for new competition. These days, the competitive landscape can change faster than Net-stock valuations. A national chain may not have entered your region yet — but what if it does? Likewise, companies that don't currently compete with yours might shift their focus and pit themselves against your firm.

11) Don't delegate the job of keeping up with competitors. You might appoint someone to work with you on the task, doing research and the like. But as the entrepreneur, you're in the best position to appreciate and act upon information about your competitors.

12) Define the competitive landscape broadly. Your competition includes anything that could draw customers away from your business. For example, movie theaters compete not only with other cinemas, but also with restaurants, live music venues, theater —l even cable TV, video rentals, and video games.

Source: All Business - A D&B Company

Effective Leadership Skills

Four Vital Things Every Leader Must Do

Even though "leadership" is one of the most common words in the English language, people's interpretation of it varies widely. But understanding a few basic concepts about leadership opens the door to leading more effectively.

First, people in charge are typically called "managers," but they're expected to both manage and lead. Managing and leading are two totally different activities. Managing involves the effective use of resources such as funds, supplies, schedules, systems, tools, equipment, and so forth. It takes special abilities to administer these resources, but none of these skills applies to working with people. On the other hand, when managers lead, they influence the performance of team members to perform at their best, both individually and collectively. Simply put, you manage things, and you lead people.

Another basic fact about leadership is that it's not just something executives do. Most books on leadership are about presidents, generals and CEOs and the more strategic things they do. The truth is, foremen, section chiefs and team leaders are leaders, too. Their success depends mostly on how they deal with their direct reports. All managers need to have effective leadership skills: from first-line supervisors to middle managers to executives.

Also, leadership isn't about personal qualities, attributes or traits. It's about what you DO. Yes, having good judgment is important, but in the end, it has to translate into effective action. When you lead, people can see you doing it.

So what actions are we talking about? How do effective leaders get people to perform at their best?

#1 - DEVELOP. To work at their best, people need know-how. As a manager, you optimize their abilities by helping them get stronger on the job. You do this by stating expectations, setting an example, instructing, giving feedback, coaching lessons from experience and supporting learning activities.

#2 - INSPIRE. Team members may know how, but do they want to contribute their best work? You influence their desire to work by tapping into their motivation. Not with rah-rah speeches or monetary incentives, but by setting an example, getting to know their values, needs and interests, expressing the team vision, assigning the right tasks to the right people, and showing appreciation for jobs well done.

#3 - SUPPORT. Think of yourself as a "servant leader," the one who gives team members what they need to succeed, removing barriers and allocating information and resources. These are things they don't have access to except when empowered through the chain of management. This happens during delegation, when responsibility, authority and guidelines are shared along with the assignment. It also happens during execution, when you trust someone with freedom of action.

#4 - ENCOURAGE. Work isn't easy. People nearly always encounter adversity-problems, mistakes, shortfalls, and failures. When it happens, they could lose energy or quit. You need to give timely encouragement so that people work through the adversity and continue striving.

As a manager, you're responsible for all four of these areas of leadership. Doing it all will require effective leadership skills and personal strengths. You aren't born with these behavior patterns. You ingrain them by applying the best practices every day. So a big part of your job will always be to grow stronger as a leader.