Understanding Your Company’s Competitive Landscape
“You’ve got to know the business.”
We have all heard that rhetoric a thousand times. Every IT pro gets the fact that to be relevant, and to solve the real issues of the business, they need to understand the essence of the business with which they work. The problem, of course, is how to build that business knowledge and understanding. The truth is that while we all know that this is an essential element of IT professional success, most IT pros don’t know how to tackle this undertaking. That’s not surprising. It’s not like you were ever taught how to do it. Or how about this crazy idea… you were given a comprehensive orientation on your company and all of its functions so that you could do the best job possible serving the interests of your employer. Oh, I see you didn’t get one of those either.
Now that we agree that attaining a solid understanding of your business is hardly a “gimme,” let’s move out of the realm of generic advice.
I’d like to introduce you to a method for developing a particularly important dimension of business understanding: the competitive landscape profile. This business knowledge is extremely important to the success of your career and the success of IT at your company.
What’s a Competitive Landscape Profile?
In short, the competitive landscape profile is a clear and articulately written presentation of your company’s products and services and how they compare to those of your competition.
This profile includes:
- the main products and services of your company and those of your competitors
- annual sales figures for each of your products or services and those of your main competitors
- market share levels, if such information is available
- and, most importantly, the advantages and disadvantages of your company’s products versus those of your competitors.
The basic facts and figures are critical for understanding the competitive landscape. They tell you where your company stands in the overall market, and you begin to understand how you compete in terms of basic factors like price, quality and service.
The advantages and disadvantages of your company’s products and services will help you identify and focus your efforts on building IT solutions that directly support your company’s competitive challenge.
At this point, I usually hear, “Great, Marc, but how do I figure all this out? Especially since you tell me you want real details, not vague generalities.” Fortunately, gathering this information involves three simple steps.
Step 1: Collect Internal Resources
Start by gathering the internally developed material of your company and competitors from Websites, annual reports, product brochures, investor packages and so on.
Subscribe to the newsletters and social media feeds of your company (you’d be shocked how few people do this) and those of your leading competitors.
These sources provide basic facts, but they are most valuable because they clue you into the stories that each company wants its target market to hear.
Step 2: Investigate Third-Party Resources
Now you’re ready for more objective information. That means it’s time for some research, starting with the obvious comprehensive search engine expeditions followed by targeted third-party sources.
A whole industry of third-party business information research and corporate analysis exists. From major investment banks and brokerage house publications to specialized websites like Hoovers.com, Yahoo Finance and finance.google.com, many excellent and free research facilities are available. (For example, Hoovers provides a company’s top three competitors in its free search results.) Even if your company is a small player in a large industry, you can learn a great deal by reading up on your supersized competitors.
Another excellent third-party resource is trade publications. They provide a lot of insider information and resources that you would be hard pressed to find on your own. For example, if you are in the pharmaceutical or medical device industry, Med Ad News regularly provides information on revenue, market share and product launches across the entire industry. All of this is incredibly valuable information for understanding the competitive landscape.
Be aware of the key publications for your industry. If you’re unsure what they are, take a walk by the executive offices and see what’s sitting on the coffee tables outside the senior execs’ offices, or do a Web search using the name of your industry and keywords like “magazine,” “newsletter,” “publications” and “news.”
Step 3: Verify and Validate
Once you’ve done your basic homework, you need to make sure you’ve got it right. There may be missing information or misinterpretations. You may have been led astray by competitors’ materials. It is time to verify and validate your information, which means you need to talk to the folks in marketing or sales.
A business colleague should be able to verify your information and findings. An added bonus is they might also point you to some information resources you may have been unaware of.
Some people find it hard to start a conversation with colleagues from other parts of the business. If you’re not sure how to get started, think about who you know in marketing or sales that seems approachable. You aren’t looking for a big sit-down meeting “to understand the business.” That will probably fall flat.
Instead, try a casual conversation at the proverbial water cooler. Or stop by a business colleague’s table at lunch and ask one (and only one) open-ended question, something like “Is it true that we are number three in the XYZ market? I came across this data and some other info about our company, and we are planning to use it in our yearly planning. I hope you might be able to quickly validate it for me.”
This technique always works. You either get an appointment with this person or are sent to another person, with their blessing, to get the answers. Either way, you win.
The competitive landscape is constantly shifting, so you can’t just do a “one and done” effort for the next three years. You have to keep your knowledge current and fresh.
Over time, as your knowledge broadens and deepens, you will become attuned to subtle changes in the business landscape as they are happening. You will be able to dialogue with the business in real time about the opportunities you see for IT to impact the competitive positioning of your company. And that will make you a tremendously valuable asset to your company.