4 Minute Read

At Cipher, we see many organizations take a misguided approach when it comes to competitive strategy, tending to operate primarily on a defensive basis. By focusing too much on identifying and monitoring competitors, organizations are consistently missing opportunities to innovate new technologies and business models that will move their business and market forward. 

Many organizations are panicked by the specter of disruption. Their leadership compensates, over-indexing on defensive competitive actions that focus on competitor identification and monitoring. Identifying and tracking a wide variety of competitors is a challenge, but it’s one that technology is making it easier to overcome. Even with the support of advanced Market and Competitive Intelligence (M/CI) technology, overly focusing on your competitors ahead of your own business is a recipe for disaster. 

Organizations that only focus on tracking their competitors exist in a reactive, defensive state. 

Organizations that only focus on tracking their competitors exist in a reactive, defensive state. Instead of taking the initiative and pioneering innovative new products, services, and business models, too many organizations simply watch their competitors and make decisions based upon their actions. This type of short-term "planning" follows an incremental strategic planning model, leading organizations to zigzag between strategies, often with no long-term aim in sight. 

A better approach is to ask how you can most effectively compete in the markets in which you operate.

A better approach is to ask how you can most effectively compete in the markets in which you operate. From that point, you gain the ability to formulate a dynamic strategic plan that outlines a bold long-term vision and lays out the necessary steps to get there. In this article, we’ll explore the necessary steps to building a strategic plan that enables your organization to effectively compete. 

-- Article Continues Below --

The Complete Guide to Market and Competitive Intelligence

Learn how you can the competitive advantage with market research 

Start Competitor Monitoring from Within

Many organizations delegate competitive monitoring to the marketing function, but the reality is that competitive strategy should start at the very top of the organization. A marketer's perspective is often overly influenced by two powerful forces: short-term, fleeting trends, and your competitors' strategies and behaviors. 

As a consequence, much of the strategic thinking that emerges from marketing departments is focused on responding to customer trends or competitor actions. 

A better approach to competitive strategy weighs an organization's unique strengths and formulates strategies that capitalize on these.

Many times, the output of competitor monitoring fails to consider an organization’s core competencies and sources of competitive advantage. This is a critical error. A better approach to competitive strategy weighs an organization's unique strengths and formulates strategies that capitalize on these. When organizations maximize their core competitive advantages, they create strategies that are highly defensible and enable them to carve out a sustainable competitive position. 

When building these strategies, include stakeholders from all across the organization: not just external-facing functions like sales and marketing. Oftentimes, it’s leaders from areas like operations, research and development, and corporate strategy groups that provide the most insightful perspectives. 

Pulling together a cross-functional team of leaders provides organizations with diverse perspectives of a competitor's, core competencies, and long-term strategies. 

-- Article Continues Below --

New call-to-action

Learn how Lone Star was able to invest more time in analysis 

Consider Customer Perspectives in Decision Making

As you consider how your organization can most effectively compete in the long-term, it’s important to consider not just the internal capabilities of your organization. Another key input should be the needs of customers, both now and in the future. 

The best way to build a comprehensive understanding of customer needs is to leverage market research tools. Traditional market research techniques, including both primary and secondary research, help organizations understand customer needs at the current moment in time. 

More advanced techniques, like prediction market research, enable organizations to quantify customer trends and understand how and when new markets will evolve. Many organizations undertake traditional market research, but few understand, or use, predictive market research technologies like HUUNUⓇ Futures

In shaping long-term competitive strategy, the ability to accurately forecast the future can be invaluable.

In shaping long-term competitive strategy, the ability to accurately forecast the future can be invaluable. With this knowledge, organizations can execute perfectly timed competitive strategies that leverage market trends and customer demands, leaving competitors playing catch up.

Automate Your Competitive Monitoring

For many organizations, competitive monitoring represents a lot of labor-intensive work. The more time that competitive intelligence professionals spend on low-value tasks like collecting and organizing data, the less time they have to spend on higher-value analysis based tasks. The best way to free up analysts’ time is to automate these low-value aspects of the competitive monitoring process by using a Market and Competitive Intelligence (M/CI) tool. 

The best way to free up analysts’ time is to automate the low-value aspects of the competitive monitoring process.

M/CI tools like Knowledge360Ⓡ provide organizations with a comprehensive suite of competitive monitoring tools, automating tasks like data collection and tagging, and enabling organizations to identify competitor activities in real-time through shared live dashboards

Knowledge360 even helps organizations to discover new competitors as they begin to develop, with powerful AI technology that identifies and uncovers important pieces of data from a wide variety of sources. 

Another approach is to leverage trends and intelligence as a service. These services use advanced technologies and expert analysts to provide valuable competitive insights, enabling leaders to shape competitive strategies with less friction and more confidence. 

-- Article Continues Below --

New call-to-action

Download the Forrester survey report to better understand the CI trends in 2021

Building a Dynamic Strategic Plan

Armed with a diverse internal team and an understanding of how customer trends might develop, begin formulating a dynamic strategic plan that will provide your organization with a roadmap for effectively competing in the market. 

A dynamic strategic plan starts with a long-term vision informed by an understanding of both core competencies and market trends. From here, the plan works backwards and identifies a series of actions that should be taken to realize the long-term vision. While there is a clear long-term goal, the strategy is flexible, and can be adapted short-term to address competitor actions or changing circumstances. These short-term decisions are driven by the output of M/CI activities. 

We've consistently seen organizations that embrace long-term competitive strategies outperform their competitors. 

These types of long-term competitive strategies can often represent a major shift, but we’ve consistently seen organizations that embrace these strategies outperform their competitors. This long-term focus enables organizations to pioneer game-changing innovations that wouldn’t have been possible with a short-term approach to competitive strategy.

-- Article Continues Below --

New call-to-action

Move forward with the tool that best fits your needs

Start Building a Competitive Strategy Today

Building and executing a dynamic strategic plan that dictates how your organization competes is a major undertaking, and many organizations would benefit from working with external strategy consultants to determine the best path for their business. 

The Cipher team is here to help. With extensive experience working in competitive strategy for Fortune 500 organizations across a variety of industries, including insurance, life sciences, and consumer packaged goods, our experts will partner with you to design and execute bold competitive strategies that drive your organization forward. To get started, schedule a call today