For all the talk these days about understanding your value proposition, there’s been very little said about the equally important flip side: understanding what your value proposition isn’t. It’s not just an academic exercise. Gaining a solid grasp of the areas in which you are weak or in which you don’t offer a material edge over your competition not only helps you clarify and better articulate your real advantage, it can also illuminate new areas of opportunity.
“Organizations that are able to view their negative space – the areas where they can’t compete or lack the skills and knowledge to be successful – can often work backward to find their edge based on their shortcomings,” says Anne-Marie Fink, an eleven-year veteran of JPMorgan Asset Management and author of The Money Makers: How Extraordinary Managers Win in a World Turned Upside Down. Take Advanced Micro Devices (AMD), says Fink. A small manufacturer of CPUs, AMD recognized it would not be able to compete with Intel in improving clock speed. So it found a different bottleneck that slowed computer response time and in 2002 rolled out an innovative new chip that returned results more quickly without increasing clock speed. For the first time in years, the company had a true value edge that enabled it to sell on features rather than price.
AMD succeeded because it “zigged when the competition zagged,” says Fink. Rather than trying to beat Intel at its own game, AMD acknowledged its weakness and, in avoiding that area, found a strength. To do the same in your company, Fink recommends managers take the following steps:
For more ideas, visit www.moneymakersbook.com.
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