Competition. A foundational element that drives greater success in a capitalistic society. And yet, examination of the array of perceptions and reactions regarding one’s competitors in business is both fascinating and revealing.
As we get to know an entrepreneur and assess a prospective investment, an important insight is their response to the multidimensional question, “How do you view your competition?”
How an entrepreneur expresses awareness, insights, differentiation, and honesty in recognition of competition can illuminate market opportunity, commercial viability, and personal credibility. Do you deny, dismiss, disparage, or do you choose to recognize and embrace others in your space? How does that answer vary when discussing competition internally or externally? Does the stress of competition drive your organization to catalyze improvement or to react with paralyzing stress?
What lessons can be learned from the competitive battle between George Costanza and his nemesis, Lloyd Braun? Serenity now.
In our early days at Eclipsys in the late 1990s, the market was peaking with good, old-fashioned street fights to win new business from a hospital. An expansive bevy of vendors were lined up for marathon beauty pageants. Even Miss Rhode Island had a chance to compete. I was oriented with a friendly disdain for Cerner, our chief competitor of the day (hindsight obviously shows who got the last laugh).
Each vendor’s sales reps were diligently trained to know as much about what the other company could not do as they did about what their own company could do. Accuracy and validity of this information was inherently suspect. Some vendors became adept at lying better than others could tell the truth. I sometimes wonder if this was how the Soviets learned about Americans during the Cold War.
Whether with a prospective customer, recruiting a new hire, or in seeking capital from an investor, there are several potential reactions when questioned about your competition and important implications for you in how your answer may be interpreted.
Reaction 1: Denial
Apart from the Soup Nazi’s crab bisque, how many products or services today are so uniquely innovative that they are beyond compare? Yet some entrepreneurs communicate they are such game-changers that they face no competition.
Upon further questioning, they may reluctantly concede that “doing nothing” is a prospect’s only alternative. While potentially valid on rare occasions for true breakthroughs, this is almost always wrong. The arrogance of holding this belief (and the manner in which this position is often communicated) generally discredits the individual and their organization. In most procurement processes in healthcare over the last quarter century, “doing nothing” has won more competitions than anyone.
Reaction 2: Disparagement
Sometimes more intentional and overt than others, the speculation and innuendo concerning another company often elevates that other vendor’s status as a leader and reflects more poorly on you 100 percent of the time.
When Seinfeld dentist Tim Whatley announced that he had become Jewish, Jerry disparaged Whatley to a priest claiming that he only converted to Judiasm for the jokes. "This offends you as a Jewish person?” inquired the priest. No,” replied Jerry. “It offends me as a comedian.” Jerry is subsequently outcast, labeled as an “anti-dentite.”
Reaction 3: Logo Bingo
Virtually every pitch deck will have one of two versions of this slide, both of which can be effective but dangerously predictable.
The first version shows a checkbox-a-palooza with a limited number of vendor logos on one axis and a capabilities list on the other. I have never seen this slide that did not have the presenting company with the most check marks possible, which immediately raises the question what other capabilities are not on the list that should be. The second version depicts four quadrants which universally position the presenting company in the farthest upper-right corner with no competitive logos even close to the neighborhood.
Reaction 4: Just Dance
Put your best foot forward and honestly assess if this is the best mutual fit. Be realistic about how you compare with your competition and gracefully admit that you are not always the best choice. The decision may or may not be close, as Chris Farley and Patrick Swayze remind us in this classic skit from Saturday Night Live.
In a free and transparent marketplace, given fair access to decision-makers and equal opportunity to compete, the innovators delivering a superior solution with a compelling value proposition should have better than a puncher’s chance to succeed. Even better than Little Jerry Seinfeld in a cockfight. How you perceive, understand, and communicate your place in a competitive landscape is a critical factor that may dictate your market success. Here’s to hoping you don’t end up living in a van down by the river.
Founder & CEO