You're a small business owner ... What makes you different from your competitor?
Why would a customer want to do business with you over somebody else?
What do you do better than anyone?
What are you good at?
Yeah, you know this crap should be top of your head, back of your hand kind of stuff.
If you're unable to rattle these things off the top of your tongue then you might not be fully acquainted with them. And lucky for you, that's exactly what we're going to talk about next: core competencies and intellectual property.
What Are Core Competencies?
Core competencies are those things that you must do very, very well, every day, to execute your business strategy. Unless you're really good at doing these things all the time, you're not a competitor. Example. If you're:
- A car manufacturer that's bad at designing cars
- An attorney that chronically misunderstands the law
- An accountant incapable of distinguishing a balance sheet from a P&L
- A rodeo clown afraid of his own shadow
- A dog trainer that's a cat person
... it's not going to work. If you can't do what's absolutely required of you, you're not going to get the job done. What are those things? Are they specific? Succinct? What makes you better at those things than your competitor? Careful though: you can't be competent in everything. You shouldn't have more than three core competencies.
What is Intellectual Property (IP)?
Special knowledge and training, products, techniques, approaches, trade secret, patents, copyrights, processes ... IP is the secret sauce. It's the value that only you or your company can provide. Consider:
- The Colonel's Secret Recipe
- Coke's Secret Formula
- A Non-Toxic, Biodegradable Carpet Cleaning Solution That Doesn't Harm Kids or Pets
- A Unique Software to Diagnose a Rare Vehicle
- You've been classically trained to restore Baroque Italian paintings
Nobody else can give your client what you're able to because what you provide is unique.
How do Competencies and IP Relate to Tech Strategy?
I love it when people go out and spend, say, $10,000 on technology that does absolutely nothing to leverage IP or core competencies. I say "I love it" because it creates a stark contrast between reality and crippling, short-sighted strategy. It's like:
- "Let's go out and blow $10k on an email server because email is what we do best. Email is our core competency." Email? Say what? So email is what you've got to do day after day to execute your business plan? Uh, no.
- You're Ford Motor Company and you lay down $10k on a web design that talks about fruit. Fruit. Fruit, and maybe how it relates to an upcoming sales promotion with a Hawaiian theme, but still ... dude, you make cars.
- On a whim, one of your managers runs out and subscribes to a $10k Customer Relationship Management (CRM) system. Meh, it worked well at the last company they were at. But your brand is known for fast, friendly, personal, face-to-face service from knowledgeable people ... and now this manager wants to put your people behind a computer screen. That seems incongruous, no? Helllooo ...
- Your medical services company just spent $10k on a special piece of software that allows you to diagnose rare genetic conditions. And on Facebook? You're posting pictures of cats with stethoscopes. Because you want to be known for crazy cats with stethoscopes.
I think you'll agree with me. Technology investments should leverage what you're good at. Above all, investment in technology should yield some strategic value through differentiation, lower cost/price, create a distinctive brand, lead through innovation, scale through rapid growth, shrink time, build alliances ...
And over the next two weeks, I'm going to talk about each and every one these strategic values and explain what they mean, but listen up: if your tech spend doesn't capitalize on what you're good at, how do you expect to produce a strategic outcome? Think about it. Then start aligning your spending with what you're good at to produce specific strategic outcomes.
What You Should be Thinking About Now
- What are your core competencies and intellectual property?
- How does your technology spending complement either? How does your technology spending distract from either?
- How are your processes and systems accentuating, highlighting, leveraging either? How are your processes and systems diminishing either?
- Consider the culture and knowledge of your team. How does what they know - your training, hiring and selection criterion, certification regime, their aptitudes - reflect your core competencies and intellectual property?
- Do you completely lack IP? How does not being able to offer a unique solution to a problem put you at a competitive disadvantage? Is it time to find IP/make IP?
- How does your website / social media engagement complement or highlight your core competencies and intellectual property? Are you talking about these things online?