Business Planning
Your Basis for Business and Basis for Growth
Most people in business – BIG or small – seem confused when it comes to differentiating between their Basis for Business/Basis for Growth and their Key Competitive Edge. Somehow, they almost always end up with products, services or intellectual property serving as BOTH.
It would be unusual for your Basis for Business and Basis for Growth not to be directly associated with products, services, intellectual property or a unique retail location of some kind. But your business will be much better positioned for success if your Basis for Business and Basis for Growth are actually a practical implementation – the leveraged result – of your Key Competitive Edge.
In other words, your Key Competitive Edge and your Basis for Business/Basis for Growth, while entirely separate things, share a direct cause and effect relationship. Your Key Competitive Edge is the engine that powers the business. Your Basis for Business and Basis for Growth are the power take offS – the transmission, drive train, differential, etc. – that LEVERAGE the engine’s motive power into practical application that can “put rubber on the road” and get you to where you want to go.
If you haven’t yet read the page on Key Competitive Edge, please do so now.
Management authority, Peter Drucker, asserts that business is really just innovation and marketing. Everything else is ancillary to these two core activities. We agree entirely with his viewpoint.
Innovation is the true Key Competitive Edge in any business. But it has to be translated into saleable, needed products or services, or there’s no Basis for Business or Basis for Business Growth. (Click the links for extra insight into the differences between the two.)
Even in a retail store where you sell the same products at the same prices to the same market as your competitors, these products are still the Basis for Business and Basis for Business Growth in real terms. What will create the difference between you and your competitors is your Key Competitive Edge. Not products or services on their own. Not even a unique retail location. Innovation will be the deciding factor.
Not innovation in terms of developing new products, but in creating new benefits, new marketing strategies, new ways of communicating with your market place. Creating new perceptions and new responses in your customers and prospective customers.
The product you buy at wholesale is NOT the product you sell at retail! It becomes a complete package of solutions to customer needs – solutions that you create in the prospect’s perception that your competitors can’t or won’t because they lack the ability to innovate in this way. Remember… a customer doesn’t go to the hardware store to buy a drill bit because they need a drill bit. They need a hole! If you can show them a better, faster, more economical, safer way to achieve that result, you’re the winner – there’s no competition.
Be careful not to confuse the two. Your Basis for Business and Basis for Growth will generally be products, services, retail locations or intellectual property (patents, copyrights, design registrations, strategies, licences, franchise agreements, etc). None of these can be reliably regarded as a Key Competitive Edge because, no matter how unique your product, service, location of intellectual property may be, someone, somewhere, sometime, somehow, is going to meet it or beat it. When that happens (and it will… count on it), your supposed Key Competitive Edge just went out the window. Now you’re back to your real Key Competitive Edge… innovation. Your ability to outwit, outthink, outsmart, outsell, outperform your competition.
Return to Your Business Vehicle
Business
Mission/Business Vision
• Key Competitive Edge
Basis for
Business/Basis for Growth
• Customer Relationships
Finance • Internal Relationships • External Relationships
