03/18/14

Creating a Competitive Advantage

Banking and small business lending is more competitive now than it has ever been. If you’re not asking yourself, “Why would a small business owner choose my bank for their next small business loan?” you should. Organizationally, if you can’t answer that question, your customers will look at what you do to as a commodity and will blow wherever the wind takes them.

Several years ago, I learned that competitive advantages don’t just happen, we decide to have them. Jet Blue asks themselves three questions every day, we should all be doing the same thing:

  1. What do we do better than our competition?
  2. What do they do better than us?
  3. How can we do that better than they do it?

One of the biggest revelations for me was learning that competitive advantage is not about the products we offer, it’s about the deliverables. In other words, it’s usually not about the things we charge for and a legitimate advantage offers the following traits:

The problem with knowing what a competitive advantage is, is the temptation to claim what you would like the ideal to be when you don’t really deliver. For example, your customer service goal might be to answer the phone before the third ring, but in reality it’s more like the fifth ring. You can’t claim three rings until you can actually do it. Backing up your performance with facts will demonstrate you’re serious about your advantage and make it impossible for your competitors to say, “We do that too.”

That said, this easy four-step process will help you create a real competitive advantage:

  1. Identify the deliverables
  2. Identify the competitive advantages
  3. Learn what your customers think is important
  4. Apply the results

In some ways, your product or service is what you provide to show up and play in the market, it’s the un-invoicable deliverables that really set you apart and create real competitive advantage.

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About the author

Ty Kiisel
Small business evangelist and veteran of over 30 years in the trenches of Main Street business, Ty makes small business financing and trends accessible in common sense language devoid of the jargon.

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