By Mike Gomez, President, Allegro Consulting
I attended a gathering of a select group of business owners who were the runner-ups for the “Small Business Person of the Year Award”. During the event each owner was asked to stand up and briefly state what they thought made his/her business so successful. One of the owners stated proudly it was his employees – he felt he was able to attract and retain good employees. That was his “secret”. Later, I had the opportunity to privately ask him what made his employees “better” and how was he able to attract them. Here is how the discussion transpired:
I asked, “Are your employees more qualified than your competitors?”
“No”, he replied.
“Do you offer better benefits or pay and thus can attract better employees?”
“Do you train them differently?”
“Do you offer performance incentives or shares of company stock and thus they are more motivated?”
“Is your work environment any different than your competitors?”
“Do you offer more vacation time, gym memberships, or other perks?”
“So then why then do you believe it was your employees and your ability to attract them that sets you apart? Why do you clam this as the reason for your success?”
He hesitated, gave a puzzled look, and then said, “I really don’t know – maybe it is not my employees.”
The sad fact is this owner didn’t know what attribute made his company successful. Most likely his employees are no more or less qualified (better) than his competitors. And because he doesn’t know, he is more likely than not to stray away from it or unknowingly allow it to flitter away. Once this happens, the business is gone.
This owner did not know or understand his company’s core competency; the unique thing they do or process they employ or value they add to win business that would be difficult for their competitors to imitate. Your company’s core competency is the foundation of your business. To grow, you should know what it is, nurture it, and exploit it.
Let’s take a moment to discuss, as an example, the core competencies of two well known businesses, Dominos Pizza and Honda.
Dominos made its mark by guaranteeing a quality pizza delivered to your door in 30 minutes or less. Their core competency was the “process” they designed starting with the how they selected the store locations and ending with the delivery method. It was this value added benefit (a warm pizza delivered quickly) that drove their customers to choose their product over the plethora of other pizza restaurants. Dominos continuously invested to refine that process (their core competency) and keep it as a discriminator and a method for growing their business beyond pizza to now include hot wings, pasta, etc….
Honda’s core competency was building high quality, reliable, light weight engines; first for motorcycles then later small cars, ATVs, lawn mowers, and the rest is history. Their continued investment in engine technology is a reflection of how well they understood what made their product the preferred choice regardless of whether it was in a lawn mower or a luxury automobile.
What is your company’s core competency?
By the way, it is very rarely “our customer service” or “our people”.
Knowing and then nurturing your core competency will ensure it continues to provide you with the competitive advantage necessary to grow your business.
Mike Gomez presents “10 Essential Elements for Long-Term Sustained Growth” as part of The Education Center at the Atlanta International Gift & Home Furnishings Market on Thursday, July 11 at 9:30 a.m. Visit AmericasMart.com for a complete list of seminars and events.
Mike Gomez is president of Allegro Consulting, a growth specialty firm with a singular purpose of helping businesses grow. Allegro helps owners with marketing strategy, sales, and operations. They also provide leadership and business coaching. For more information, visit http://allegroconsultant.com.