Distinct or Extinct. Differentiation for Competitive Advantage. Greg Fisher

Transcription

1 Distinct or Extinct Differentiation for Competitive Advantage Greg Fisher

2 In category after category, companies have gotten so collectively locked into a particular cadence of competition that they appear to have lost sight of their mandate, which is to create meaningful grooves of separation from one another. Consequently, the harder they compete, the less differentiated they become. Youngme Moon Donald K. David Professor of Business Administra6on at Harvard Business School

3 Dif-fer-en-ti-ate v. tr. To perceive or show the difference in or between; discriminate

4 Layers of Differentiation P Product/Service Delivery of a product and/or service that is perceived to be distinctly different from other products and services on the market

5 Product/Service Differentiation Traditional Examples Price Range Quality Familiarity Durability Credentialing Warranty Convenience Financing Accessibility

6 Layers of Differentiation O Organization Creating an organization with a unique and valuable set of resources and relationships Product/Service

7 Organizational Differentiation Traditional Examples The war for talent The knowledge enterprise Total quality management The matrix organization Strategic alliances

8 Layers of Differentiation Organization Product/Service T Touchpoint Fostering distinctive and memorable interactions with customers that streamline the buying process

9 Touchpoint Differentiation Traditional sales tactics Customer experience management CRM Delighting customers

10 Layers of Differentiation O Organization Creating an organization with a unique and valuable set of resources and relationships P Product/Service Delivery of a product and/or service that is perceived to be distinctly different from other products and services on the market T Customer Touch point Fostering distinctive and memorable interactions with customers that streamline the buying process

11 Surface Level Differentiation Archetype Audit Firm Catalogue Business Insurance Agency O Organization P Product/Service T Touchpoint

12 6 Lessons in Differentiation

13 Lesson 1 Leverage what you got

14 Lesson 2 Niche focus to broad base O

15 Lesson 3 Establish a strategic roadmap

16 Lesson 4 Less is more <

17 Lesson 5 Look beyond cost $

18 Lesson 6 Differentiate across your business model

19 Lesson 1 Lesson 2 O Lesson Lesson 4 Lesson 5 Lesson 6 < $

20 A Tool For Differentiation

21 Business Model A business model describes the rationale of how an organization creates, delivers, and captures value Business Model Generation. Alex.Osterwalder & Yves Pigneur. Self published, 2010

22 The Business Model Canvas Relationships Partnerships Key Activities Value Proposition Key Resources Customer Channels Customer Segment Costs Revenue Streams

23 1 Value Proposition Bundle of products and services that create value for a customer segment Solves a customer problems or satisfies a customer need Examples of value creation Newness, Performance, Customization, Design, Brand, Status, Price, Cost reduction, Risk reduction, Accessibility, Usability

24 2 Customer Segment Groups of people your organization aims to reach and serve Segmented according to needs, channels, relationships, profitability, payment preferences. Examples Mass Market, Niche, Segmented, Diversified, Multi-sided platforms

25 3 Channels How a business communicates with and reaches its customers segments to deliver its value proposition Channel Types Sales force Web sales Own stores Partner stores Wholesaler Channel Phases Awareness Evaluation Purchase After Sales Delivery

26 4 Customer Relationships Types of relationships a business establishes with its customer segments Motivations: acquisition, retention, up selling Relationship Types Personal assistance Self service Automated service Communities Co-creation

27 5 Revenue Streams Cash a company generates from each customer segment Ways to generate revenue: Asset sale; usage fee; subscription fee; leasing or renting; licensing; brokering; advertising

28 Key 6 Resources Most important assets required to make a business model work Categories of key resources: Physical Intellectual Human Financial

29 Key 7 Activities Most important things a company must do to make a business model work Categories of key resources: Production Problem solving Platform/network

30 Key 8 Partnerships Network of suppliers and partners that make a business model work Alliances, coopetition, joint ventures, buyer-supplier relationships Motivations for partnerships: Optimization and economies of scale Reduction of risk and uncertainty Acquisition of resources or activities

31 Cost 9 Structure Describes all costs incurred to make the business model work Two broad cost structures: Cost Driven versus Value Driven Characteristics of cost structures: Fixed costs Variable costs Economies of scale Economies of scope

32 Layers of Differentiation Organisation Product/Service Touchpoint Finance