Understanding your competitors is a very important way of understanding your own company or organisation better because it is only really possible to properly understand your own company in the context of what’s going on around it.
Having this understanding also makes you much more credible when talking to line managers about strategic issues, and it’s not only about understanding what’s different, but also about what’s the same.
Looking at how your competitors structure and approach their businesses will help you to understand their strengths and weaknesses in relation to you. It will allow you to benchmark what is happening in your own organisation, and help you to challenge some of the ways in which your business does things.
You should also consider what lies behind their structures: what are their cultures like how are people treated what do their reward system look like, and how well liked are they? The answers to these questions can tell you a lot about how well your competitors might be perceived as employers. The answers might also help you to better understand why your business does things in the way that it does. Ultimately, these answers might give you some insight into different ways of doing things that could potentially benefit your own organisation.
Understanding how your competitors operate will also support your recruitment and retention of staff. Does the way in which your competitors work translate easily into the way that your organisation works? Would their people be good potential employees for you? Also, if you find that one of your competitors is changing its structure, will that make it more or less attractive to any of your people who might be considering moving?
It is also helpful to look at things that contribute to their image in the market place. Things such as your competitors’ approaches to corporate social responsibility, branding and values, and their external communication practices will help you understand them more fully.
We have discussed a number of different ways in which you might go about seeking out this information over the last six months – from networking, reading the trade press, conducting interviews, to asking headhunters to include competitor reports, and so on. Hopefully, you will be beginning to see the benefits of some of these activities, and if you need a reminder you might find it helpful to look back at some of our past articles online such as Name the chief executive of the company’s three top competitors.
Jan Hills, partner, Orion Partners