Doors Trap

During this time of year, it’s natural to turn our attention toward January 1st and all of the excitement and anticipation that comes from beginning a new year.

What new products will you introduce to customers? What new services? Will you add a new location, or maybe two?

But are you thinking and strategizing about how you will avoid the two trap doors that can derail your business in 2014?

The trap doors can be subtle — they can be silent — but their effect on your sales, customer service, and your ability to grow your business can be devastating.

Luckily, if you look for the trap doors and develop the right action plan to side step them, you will create irrefutable sources of differentiation for your business. You’ll also be well on your way to using distinction as your secret weapon in 2014.

Trap Door #1: Ignoring the destroyers of differentiation

I learned about this trap door after interviewing Scott McKain, who is the leading authority in helping businesses create distinction by avoiding what he calls the Three Destroyers of Differentiation. They are critically important for any business owner and I will review each of them as McKain taught them to me.

Copycat competition

When one of your competitors creates something unique and different about their business, your natural tendency may be to do one of two things:

  1. Copy or imitate the improvement
  2. Attempt to incrementally improve upon what they just created

On the surface, points one and two may seem like the natural ebb and flow of competition, but therein lies the trap door. By following points one and two, your efforts will be based on what your competitor is doing and not what your customers actually want from you.

Yes, when you focus on keeping pace with competitors, your business will evolve and change over time. On the surface, it may seem like progress is being made, but your customers are likely wanting — and looking — for someone, anyone, to step up and revolutionize things by offering them something innovative.

The only way you can deliver something revolutionary is to focus on what your customers want and not what your competitors are doing.

New and better competition

Because of the seismic shifts in technology, access to capital, and the opening of new markets, you are being confronted with more and more competitors that are right at your doorstep and right at your customer’s fingertips.

As McKain said to me, “Stephen, it is easy to figure that if most of my customers are going to McDonald’s, then I am going to try and out McDonald’s in order to restore my business. But, imitation in today’s marketplace provides very little traction.”

Don’t fall into the trap of trying to execute your competitor’s strategy better than your competitor. You will be working hard to essentially stand for what your competitor stands for, and that doesn’t make long-term sense.

Familiarity breeds complacency

This destroyer may have been the most powerful lesson McKain taught me. Human beings can begin to take something we like for granted when it becomes boundlessly available. We, as business owners, can also become complacent when we forget how hard we competed to win all of our customers. And now that we have retained our customers, we don’t have to fight as much. We are not as hungry as we once were and that lack of hunger makes us vulnerable to losing customers to more ambitious competitors.

So how does a business owner side step the three destroyers and go on to build irrefutable differentiation that attracts customers?

You can do it by defending yourself against trap door #2.

Trap Door #2: Thinking innovation is only important for big companies

I recently had the opportunity to sit down with Stephen Shapiro, a leading authority on the topic of innovation and creativity. Shapiro helped me understand that innovation isn’t exclusively reserved for big companies like Apple, Southwest, and all of the other stories you typically read about.

Shapiro also changed the way I defined innovation. He said, “Innovation is not about developing new products, new services, or new ways to serve customers. Innovation is about changing your business on a predictable and repeatable basis. It’s not about one change, it’s about ongoing change.”

This was a huge shift for me. Shapiro went on to explain his challenge-centered innovation philosophy, where a business owner along with his or her team looks to solve key problems by focusing on the right challenge and by looking outside their own expertise and industry.

Shapiro explained to me that too often, business owners begin believing that the challenges being faced within their business or industry are unique to them. In reality, if they took the time to look outside of their own expertise, they may find examples where other companies in different industries already solved similar challenges. Business owners can then apply these solutions, and in the process, create exciting innovations that add value to customers.

Shapiro shared an instance when a client of his (an ink cartridge manufacturer) was struggling to get customers to return their used cartridges. Shapiro decided to lead the team through a discussion, where they looked at companies outside of the ink industry that may have already solved a similar problem.

Guess what they discovered? Netflix had already solved the problem. Shapiro tells the story in this brief 6-minute video. It’s a tangible example of how to use innovation to negate the effects of Destroyer #1: Copycat competition.

You will be well on your way to creating irrefutable sources of differentiation in 2014 when you step over these two trap doors.

Onward with gusto!