You’ll be amazed at the many businesses that operate as if competition doesn’t exist. Competition is inherent in all facets of life on earth and can never be taken lightly. Oft time people act oblivious of the existence of competition only as a cover for the actual fear of dealing with it. If you look at most key performance areas of any business they are so characterised by competition that you can’t ignore it. For instance, value propositions are crafted with the aim of outdoing the competition. Marketing efforts are meant to lure customers – the fact that you’ve got to lure them connotes competition from other brands. Competition can somewhat be dreadful and too tasking but if embraced properly can result in enhanced business performance.
Innovation Can Be Borne Out of Competition
We are obviously in the thick of tech advancements and as such most business progress is now anchored on leveraging on the latest tech. I’ll look at for instance at the motoring industry. Tesla Motors has taken huge strides in the production of affordable electric cars. They have achieved remarkable results by meeting (or even exceeding) ridiculous production targets and sales targets. They have now also entered into the Chinese market showing clearly that they’re poised for great heights. Not only have they done wonders with respect to electric cars, but they have also made remarkable progress in autonomous driving. They have developed software for autonomous driving that’s easily uploadable to their Teslas.
What all this has done is that it has pushed other established vehicle manufacturing brands to innovate much faster than before. Almost all major car brands such as Mercedes Benz, Volvo, BMW, amongst others are now heavily invested in pursuing electric car tech and autonomous driving tech. So this is just one illustration of how competition can actually lead to innovation thus making the business even stronger. There are several instances as a business where you might never get to realize something you ought to be doing unless you notice a competitor doing it.
Improved Customer Service Provision
It’s common that when a business isn’t facing stiff competition it tends to slacken on offering satisfactory customer service. That’s why locally in the telecoms industry you’ll notice that Econet can get away with poor customer service. It’s because they have an extremely dominating share of the mobile services market. People wish for the coming in of telecoms titans like MTN or Vodacom; it’s because people understand the dynamics of competition and customer service. Take a look at the local fast foods industry for instance. Backtrack some years you’ll remember that Chicken Inn used to be the main fast food outlet in most towns. Fast forward some years and we now have Chicken Slice, Mambos Chicken, Steers, Chicken Licken, amongst many others. What this has done is that it has increased competition in the fast foods industry. Thus, the various brands now invest more time, resources and efforts in creating the best customer experiences. Since options or alternatives are now plenty poor customer service is punished instantly by customer migration to other brands.
Competition Can Cause You to Rethink Your Value Proposition And To Niche Strategically
Let’s look at TelOne (unbundled from the former PTC). PTC was in the position of being sole provider of telephony services, so much so, they made demands that bordered on the absurd for their services. The ushering in off mobile telephony quickly coupled with prepaid changed the status quo. Since people were now more given to communicating through mobile phones and the internet the services offered by PTC were no longer relevant. The competition was so fierce that we really thought PTC was dead and gone. However, the heat of the competition caused them to disband PTC into 3 separate entities namely, Zimpost, POSB and TelOne. So I said earlier on that my focus is TelOne. Mobile telecoms disrupted the landline-based phone system that was so popular back then. Since they couldn’t keep up with the fierce competition from mobile telecoms they decided to diversify into VoIP and internet data services. Now they are still in business and service a whole new niche by offering products and services are in-demand today. So as a business facing stiff competition shouldn’t get you to a point of throwing in the towel. Rather you should be forced to rethink your value proposition or the niching aspects.
There are so many reasons why competition strengthens you as a business. I’ve deliberately taken time to discuss just 3 of them at length so that you get a broader picture of why you need competition. Competition is a catalyst for innovation, cementing or redefining your value proposition and opening up your vision to new realizations. Ultimately with proper leveraging on competition, a win-win situation for both your business and the customers is consummated. So the next time competitors emerge in your line of business don’t be utopian by thinking you’re all set because you’re established. Anticipate and embrace competition because it pushes you to actuate your fullest potential as a business.