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This week’s “Inside the Executive Suite” from the Armada Executive Intelligence Brief newsletter focused on an intriguing article from Inc. online. The article identified reasons why major companies invest significant, seemingly unjustified amounts on startup businesses with scant revenues and no discernible business models.

Big-Idea-Dollars

The original article from Inc. by Dev Aujla claims major companies use these acquisitions as a new variation on research and development. A major corporation may be able to pick up a whole startup for many millions of dollars. Despite seeming like an excessive figure, the purchase price could still put the major corporation dollars ahead versus developing whatever the startup offers on its own.

Aujla highlights three reasons major companies target these acquisitions. They are typically looking for:

1) New learnings and research
2) The opportunity to more easily plug a hole in their product or market portfolio
3) Talent that moves them ahead in new areas

AEIB-GraphicThe folks at the Armada Executive Intelligence Brief used Aujla’s three items and offered strategic thinking questions for each of the three areas.

The strategic thinking questions provide a way for companies, even ones far beyond startup status, to develop strategies boosting their chances for acquisition or spin-off opportunities. Armada agreed to let us share the questions here for each of the three areas.

The remainder of this post with the strategic thinking questions comes directly from the Armada Executive Intelligence Brief newsletter and its “Inside the Executive Suite” edition.

Strategic Thinking Questions for Crafting Startup Strategy in Any Business

1. Developing New Learnings and Research

Many companies claim to be learning organizations. This is often professional development jargon for “educating the staff.” While education is important, it won’t prompt another company to pay a premium simply because your employees have current training.

Try this strategic flip, though. Instead of characterizing your company as a learning organization, characterize it as a “discovering” organization. With that change in strategic perspective, evaluate where you stand today and where you would like to be a year from now:

  • What is our organization discovering that no other party knows?
  • How many people inside our organization are hell-bent on discovering new technologies, capabilities, and possibilities to bring to market?
  • Who are the people and organizations outside our own that we are collaborating with on major discovery efforts?
  • What discoveries can we make happen at lower cost, with less risk and red tape, and at a markedly faster pace than bigger firms can?

These answers should stretch your organization to move beyond learning what everyone else knows into discovering breakthrough knowledge with real value to outside parties.

2. Filling Holes in Markets, Audiences, or Product Portfolios

Aggressively examine market, audience, and product strategy gaps at other organizations to discover missing elements you can fill through your own exploration.

  • Which organizations have bigger, more sweeping product visions than ours? What gaps exist in their product portfolios we might be able to supplement through our narrower focus on product and market development?
  • What markets adjacent to ones we serve include competitors with missing elements in their market, audience, or product mixes?
  • Are there companies in related or even far removed categories lacking strong platforms for innovation that our discovery strategy could readily address?

Don’t think about fixing everything with these discovery efforts. Focus on the minimum standard product or market development allowing another organization to readily fill a gap by eventually acquiring what you are doing.

3. Gaining New Talent

Consider how your organization pursues new talent. Is there a deliberate attempt to hire the types and caliber of people most ready to help your organization discover and grow along a valuable path?

While you may be hiring to clear standards, evaluate – if you haven’t already – who will be the “explorers” you need to discover the knowledge, markets, audiences, and products with the greatest potential value. Think about these questions:

  • What deliberate actions are we taking to bring on extraordinary discoverers?
  • What steps are we taking to identify and target emerging talent, i.e., people who aren’t as well known, but are about to become rock star talents?
  • What relationships are in place (or can we develop) with educational institutions that are doing new work and introducing new programs in areas of discovery for our organization? (BTW, you may need to be looking at grade schools, middle schools, and even home schooling programs.)

It’s clear that answering these questions won’t lead to simply placing online ads and waiting for your email inbox to fill with too many resumes! – via “Inside the Executive Suite” 

 

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Mike Brown

Founder of The Brainzooming Group, and an expert on strategy, creativity, and innovation. Mike is a frequent speaker on innovation, strategic thinking, and social media.

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We have been developing a new competitive intelligence process for a client. The B2B company wants to better collect, analyze, and disseminate valuable insights on competitive strategy.

As with many competitive intelligence systems, especially in B2B settings, much of the most timely and otherwise unavailable intelligence will come from the salesforce. Similarly, the salesforce is in one of the best positions to take advantage of competitive intelligence to better position products, value propositions, and offers to customers to stymie competitive strategy.

It is vital, however, to ensure the competitive intelligence process is not simply asking for competitive intelligence from salespeople, and then giving it back to them without adding sufficient value.

6 Ways to Enhance Competitive Intelligence from the Salesforce

Heard-On-The-Street

To combat this possibility, here are six enhancements to competitive intelligence that originates with the salesforce to deliver new value:

  1. Aggregate information from multiple people to provide a view no one individual has in order to see patterns or spot trends.
  2. Perform additional and deeper analysis on the raw information to create new understanding.
  3. Communicate information to senior leadership that salespeople feel intently, but that is typically lost in the corporate shuffle (i.e., a regional or niche competitor who is not big enough to get corporate-wide attention).
  4. Disprove or verify early rumors salespeople have reported to address the word on the street.
  5. Exploit the availability of non-sales sources to enhance the raw intelligence and deliver new information to them.
  6. Make if more efficient for sales to gather and especially share competitive intelligence with a process that funnels competitive intelligence to them when they need it.

Is a more robust competitive strategy in your plans?

If your organization needs to boost the value of competitive intelligence from your salesforce, give us a call or email. We’d love to talk to you about how we apply our Brainzooming techniques to efficiently gathering information from broad sources and turning it into actionable competitive intelligence. – Mike Brown

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The Brainzooming Group helps make smart organizations more successful by rapidly expanding their strategic options and creating innovative plans they can efficiently implement. Email us at info@brainzooming.com or call us at 816-509-5320 to learn how we can help you enhance your strategy and implementation efforts.

Mike Brown

Founder of The Brainzooming Group, and an expert on strategy, creativity, and innovation. Mike is a frequent speaker on innovation, strategic thinking, and social media.

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If you want to improve your organization’s innovation successes, how about going to school on your competitors?

Skeptical? Don’t be!

7 Things Competitors Can Teach You about Innovation

Here are 7 areas your competitors can teach you about innovation. You can answer these questions to better understand the pros and cons, whys and wherefores of how competitors in your industry are addressing innovation and what it means for your brand.

School-Zone

1. Where have competitors traditionally beat us to market with innovative ideas?

Based on the answer, look for reasons why competitors are beating your brand to market. Is your brand ruling out certain strategic moves, missing opportunities for innovation, or lagging during implementation? What do the answers suggest about innovating differently in the future?

2. Which innovations have come from traditional competitors versus newer players?

Generate a list from the past several years of significant innovations in your industry. Do this by asking various people in your business (or even your industry) for their recollections. Consolidate the lists into a timeline. Review the results to see which players are pursuing a competitive strategy based on innovation to drive change in your industry.

3. What signals did competitors make before introducing recent innovations?

Use your list from question 2 to look backward to recent innovations. What were competitors doing and saying prior to introducing these innovations. While you won’t find them in every case, it’s worthwhile to identify whether competitors have any corporate “tells” that signal their innovation moves before they reach the marketplace.

4. How would our competitors develop and introduce our brand’s newest innovation differently?

On one hand, if there are dramatically different innovation strategies competitors are using relative to yours, that could be VERY good. Alternatively, these differences could signal your brand is missing strategic opportunities. You need to look at the situation and judge which it is.

5. How long do competitors stick with an innovation that’s not working?

Can you identify a pattern for how much time competitors allow newly-introduced innovations to thrive, survive, or die? Look for relationships (cost, visibility, etc.) that explain any pattern that might exist.

6. Are competitors introducing innovations we couldn’t profitably produce and sell at comparable prices?

It’s vital to assess whether your brand’s inability to match the price of a competitor’s recently-introduced innovation is because of its cost advantages, a difference in cost structure or allocations, a deliberately aggressive / share-gaining price, strategic brilliance, or stupidity. Any one or a combination of these suggests competitive strategy problems.

7. Have competitors introduced successful innovations with inferior features to ours?

If a competitor can introduce a successful innovation with seemingly fewer features than your offerings and still be successful, the competitor may have figured out customers are looking for something different. That difference may be a preference for simpler, cheaper, or easier to use innovations.

Competitive Strategy Lessons about Innovation

See what we mean?

Your competitors could be the best source you have to learn a lot more about how to improve your innovation successes in the future.  – Mike Brown

 

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The Brainzooming Group helps make smart organizations more successful by rapidly expanding their strategic options and creating innovative plans they can efficiently implement. Email us at info@brainzooming.com or call us at 816-509-5320 to learn how we can help you enhance your strategy and implementation efforts.

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Founder of The Brainzooming Group, and an expert on strategy, creativity, and innovation. Mike is a frequent speaker on innovation, strategic thinking, and social media.

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Data-savvy marketing & innovation expert, Woody Bendle takes a look in this guest post at the relationship between customer centricity and growth, or more specifically the lack of both among a select group of traditional retailers.

And just so you know, beyond being a fantastic resource on brand strategy and innovation, Woody has set a new high bar for guest contributors at Brainzooming. He delivered this most recent guest blog post along with a slab of his homebbqed ribs! So, for all the people who send us emails about wanting to guest post with “incredible, unique content,” the question is, “How good are you at grilling?”

Now, here’s Woody!  

 

Brand Strategy – Customer Centricity and Growth by Woody Bendle

Many of America’s largest retailers recently reported financial results falling short of analysts’ (and undoubtedly their own) expectations.  The table below recaps the highlights (or low lights) among select national retailers.

Retail-Q1-2014

Many of them attributed this winter’s unusually cold weather and continuing economic struggles among core customers for their economic shortfalls.  But digging deeper into their numbers shows more to the story. Many of America’s largest retailers are finding it much harder to generate profitable growth in the traditional manner, which has been opening stores in new (domestic and international) markets, expanding product assortments, and becoming more effective and efficient through operational and executional improvements.  Or as I like to say, just getting bigger and better.

The graphic below, which I use when discussing business growth strategy, illustrates the concept of growing a business is pretty straight forward. As the businesses above demonstrated this past quarter, however, it isn’t always easy.

Growth-Framework

To grow any business, you have four options:

  1. Get existing customers to buy more of current products or services
  2. Get new customers (i.e., in different markets) to buy current products or services
  3. Develop or find new products or services for existing customers
  4. Develop or find new products or services for entirely new customers

For roughly fifty years, growth path for nearly all of the retailers above has focused on cells A, B, and to some extent C (i.e.,  Walmart and Target expansions into grocery).  For much of this time, most of these businesses have had incredible success, but growth has become harder the past several years.

What’s changed?

Two things that are fundamentally different about today’s business environment:

1. Market power has shifted away from many businesses to the consumer, due to radical decreases in the costs associated with information and geography.

The internet and mobile technologies have greatly improved the consumer’s ability to be better informed (about alternatives and competitive prices globally) and have enabled disruptive businesses to emerge (i.e., amazon.com – note its 26% growth in North America this past quarter). These have diminished the need for customers to travel to a physical store to make a purchase.

2. The great recession fundamentally changed the consumer mindset, resulting in a “new normal” in consumer behavior.

This is best summed up by The Future’s Company:“Consumers everywhere … are working from a new orientation about what they want and how they buy… [They] are now battle hardened, having found ways to survive and even thrive on the new opportunities a more competitive market has yielded.”

The result is the traditional path to growth – getting bigger and/or getting better – is nearing its limit for many businesses.  This necessitates businesses rethinking their growth strategies, with adopting customer-centric business practices as one avenue for new growth!

Growth through Customer Centricity

Something fascinating about the Strategic Business Growth Framework is the customer/consumer is actually present in every cell.  Through my own consumer experiences, however, it doesn’t often feel like many businesses realize this.  How many of you have heard a store associate say something like, “I don’t know how I’m going to get my job done with all of these customers in here”?

Many businesses are either product or operationally focused.  Nearly every decision they make starts with what they sell (or plan on selling), or how they go about doing what they do.  These businesses put what they do and how they do it in front of whom they do it for.

This is a primary reason why it has taken so long for many traditional businesses to embrace fully integrated multi-channel or omni-channel practices.  While most understand it makes sense to the consumer, they haven’t figured out how to make it make (financial) sense given what they already do, how they currently do it, and how they currently measure all of it.

A customer centric business, however, thinks exactly opposite.  Its decisions start with the customer. Activities (and incentives) are aligned to profitably deliver goods or services maximizing value for customers – and, in turn, their shareholders.  Once they identify an opportunity to create more net value over time, they systematically figure it out, sometimes at the expense (temporarily or permanently) of existing business.

It’s all about creating new customer and shareholder value!

The Next Customer Centricity Step Is Yours

My intent is to shine a light on a different path, not provide the playbook for becoming a customer centric organization.

If you want to become more customer centric, here are eleven questions to help decide if customer centricity is right for you and to help on your journey:

  1. Why do my customers come to us vs. the competition?
  2. What value do we provide to our customers today?
  3. What are all our customers’ needs?
  4. Have our customers’ needs changed? How and why?
  5. What customer needs do we currently meet / exceed today?
  6. How well are all of their needs being met by the marketplace today?
  7. Are there new competitors who are satisfying some of our customers’ needs in a different way?
  8. What can we do better (or differently) to uniquely meet and exceed those needs today and tomorrow?
  9. What else can we do to create even more value for our customers?
  10. Are we willing to put customer’s interests at the center of our decisions and processes?
  11. How much are we willing to change?  Really?

And as you answer question 11, don’t confuse how much change you are willing to undergo with how much that change is noticed by customers and whether they value it.

Those are three separate questions for all you operationally focused people. There’s no “extra credit for efficiency” in trying to answer them all together. To the contrary, you’ll definitely be penalized for thinking efficiency at the expense of thinking about your customer! Woody Bendle

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Download the free ebook, “Taking the NO Out of InNOvation” to help you generate fantastic creative thinking and ideas! For an organizational innovation success boost, contact The Brainzooming Group to help your team be more successful by rapidly expanding strategic options and creating innovative plans to efficiently implement. Email us at info@brainzooming.com or call us at 816-509-5320 to learn how we can deliver these benefits for you.

 

Mike Brown

Founder of The Brainzooming Group, and an expert on strategy, creativity, and innovation. Mike is a frequent speaker on innovation, strategic thinking, and social media.

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Fake-Book-BoundDuring a recent “Creating Strategic Impact” workshop, I had the attendees (who were all from one company) form smaller groups to identify potential disruptive competitive threats in their technology industry.

Talking in advance with the client organization’s president, he said his people might struggle with this strategic thinking exercise since they hadn’t previously addressed competitive threats this way.

The One Strategic Truth You Must Never Forget

One group had a participant who quickly completed the first part of the strategic thinking exercise, listing three clear customer benefits his company delivered.

But then instead of identifying companies who might offer any one of those benefits individually, he put a big, bold imaginary circle around those three customer benefits. This quickly dead-ended the strategic thinking exercise as he claimed NO competitor could come to the market with all those benefits. As a result, he reaffirmed his belief that his company had few, if any, disruptive competitive threats.

The other participants in his small group perceived the flaw and tried to help him see the error in his perspective. I too tried to redirect him, pointing out that truly disruptive competitive threats targeting his company weren’t  going to show up nice bows around all three benefits his company delivered.

In fact, very real disruptive competitive threats might appear offering only ONE of those benefits, with little concern for the other two. This new disruptive force would win business with a different approach, different strategies, and different perceptions about what is important to my client’s customers.

Because it was a workshop format, there was no opportunity to spend any more time with this individual to see if he was finally persuaded about competitive threats or not. But whether he was or wasn’t, I suspect many of us, even though we know better, fall into the same trap.

Disruptive Competitive Threats

Let’s state it again so we can all be clear: the disruptive force in your industry isn’t going to show up looking like your brand and offering the same complete set of benefits.

The disruptive force may have only a vague resemblance to your brand and what you do, and win business because it sees the rules of competition and success very differently than your brand does.

That’s why so many companies who TRY reinventing themselves and staying successful fail. They have WAY TOO MUCH invested in every part of their status quo (and likely antiquated) views of the world. Unwilling to blow themselves up because they have too big a stake in what has existed for a long time and persists to today, some other brand with an insightful view of tomorrow is more than happy to do the work for them.

Think about it this way: No matter how much you might hope it might be different, you can’t have archaic and eat it too. Mike Brown

 

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Picking up on the competitor strategy theme from the start of the week, I combed the Brainzooming archives to share a variety of competitor strategy ideas we have covered.

82 Competitor Strategy Ideas to Improve Your Competitive Success

Competitive-GorillaHere is a handy summary of 82 competitor strategy tools, questions, and ideas you can use to hone your competitive success now and in the future:

Going on the Attack for Competitive Success

Playing Defense with Your Competitor Strategy

There should be at least a few ideas you can start applying right away to go after that 400 pound competitor gorilla in the room and improve your brand’s competitive success! – Mike Brown

 

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The Brainzooming Group helps make smart organizations more successful by rapidly expanding their strategic options and creating innovative plans they can efficiently implement. Email us at info@brainzooming.com or call us at 816-509-5320 to learn how we can help you enhance your strategy and implementation efforts.

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DHL-FasterNot every disruptive marketing tactic in a competitor strategy has to be an industry-changing move by a non-traditional competitor against a stagnant old-line competitor. 

Sometimes disruptive marketing might simply involve one behemoth beating up on another one in an unusual way – even through a prank.

A video appearing online last week is an intriguing example of competitor strategy involving disruptive marketing although, according to some reports, it is a prank of a prank.

Disruptive Marketing Pranks

The original video “suggests” that courier DHL shipped several boxes via its competitors, including UPS and TNT. At pickup, each package initially appeared to be black, allegedly from being covered in “temperature-activated ink” that was chilled before shipping. As the boxes warmed during transport, the black disappeared to reveal a prank message on the difficult-to-deliver boxes. DHL (or its agency or some other third party) videoed delivery of the boxes to hard-to-find addresses to create the video shared here.

At the time this is being originally published, there are questions about whether DHL was involved in the prank.

Quite honestly, having competed against DHL where they directly used our company’s name (along with reference to the UPS Brown campaign) in a print ad, I would not put this past them. But whether DHL was involved originally or not, it is still a trigger for strategic thinking about going after a competitor in an unusual way.

Another thing interesting about this example is that from a US perspective, this looks like a small, potentially disruptive competitor (DHL) going after a huge industry leader (UPS).

But that’s not the global picture.

DHL is part of Deutsche Post DHL (which is the German Post Office), the world’s largest courier company. So instead of the little guy engaging in disruptive marketing against the big guy, this would be the biggest guy slapping around a couple of enormous, but still smaller competitors.

Having been in the transportation industry, the delivery side of a prank like this (again, if it is real) would be the least of the concerns for UPS and the other competitor involved. The bigger issue would be the complaints about these boxes that would not move through competitors’ conveyor systems, likely necessitating one-off handling as they started revealing their messages!

Would this fit your competitor strategy?

What do you think?

Would you ever prank your competitor and stick it in the brand’s face like this? Have you already done it? And does the strategy matter based on whether you are the big player or small player in your market? Mike Brown

 

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Founder of The Brainzooming Group, and an expert on strategy, creativity, and innovation. Mike is a frequent speaker on innovation, strategic thinking, and social media.

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