The key to building a good Tangible Vision is knowing your opposition, your settings and yourself via proper strategic assessment protocols.
Gathering the information is one thing. Knowing how to assess the information is another.
As Sun Tzu Says, Know Your Enemy - Competition
Editor’s note: “The Angel Connection” is a regular feature in WRAL Local Tech Wire. LTW asked consultant Bill Warner to share advice for entrepreneurs seeking angel investors and/or venture capital investment. He is chairman of the Triangle Accredited Capital Forum, an angel investor network with over 100 members throughout the Southeast.
RESEARCH TRIANGLE PARK – Sun Tzu expresses it in many ways with respect to preparing for war, when he writes “know your enemy.”
Preparing to compete in business is similar in a lot of ways. One of the similarities is the need to know your competition in detail. As in war, you don’t want to enter the battlefield with the wrong weapons, deploying inappropriate tactics, with too few people, or engaging on the wrong terrain.
When you are selling to a premier customer or presenting to a possible investor, you need to be prepared to answer such questions as:
• What makes your product or service better?
• Why should I buy from you?
• How are you differentiated?
• How successful are they?
• What are you doing to exploit their weaknesses?
• What strengths do they have, and how are you responding?
• What are they going to do to beat you?
• How much does your competitor charge?
• Is your service better?
• Are they public or private?
• Who funds them?
• Who is their lead investor?
• What financial position do they have?
• What is their pricing strategy?
• What is their marketing strategy?
• How is their sales force deployed?
Not being able to answer basic questions about your competition, will reduce your chances of winning a sale or getting funding. Worse yet, you will not be able to form a clear strategy to beat them.
What you need to know
An assessment of each of your competitors needs to be created. The research can come from all sorts of sources like: Websites, SEC filings, media articles, consultant briefings, marketing material, their customers and former employees. Of course, make sure you are not gathering anything that is proprietary. Basically the content of the assessment should be:
• Company description including demographics and size
• Summary of key management
• Financials, with an analysis of strengths and weaknesses
• Description of how they are capitalized
• Product line description with an assessment of their strengths and weaknesses
• Description of their marketing and sales strategy
• Positioning analysis and what makes them different
• Determination of what threats they represent to your strategy
• Description of what opportunities you have to beat them
Some people call this a SWOT analysis (strengths, weaknesses, opportunities and threats). It is, plus more. This basic information is what is needed to formulate a plan to win against them and to effectively answer the tough questions you are going to have to answer.
Organize this information in a way that allows you to quickly identify what strategy you are going to need to beat them all.
About the author: Bill Warner is the managing partner of Paladin and Associates, a business consulting firm in the Research Triangle Park area of central North Carolina, and is the chairman of the Triangle Accredited Capital Forum, an angel investor network with over one hundred members throughout the southeast.
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