During a recent event for a group of small business owners who were runner-ups for a "Small Business Person of the Year" award, each owner was asked to stand up and briefly state what they thought made their business so successful. One of the owners stated proudly that it was his employees - he felt he was able to attract and retain good employees. This was his "secret." Later, I had the opportunity to privately ask him what made his employees "better" and how he was able to attract these employees.
"Are your employees more qualified than industry standards – do they have higher degrees?" I asked.
"No," he replied.
"Do you offer better benefits or pay to attract better employees?"
"Uh, no."
"Do you offer performance incentives or shares of company stock?"
"No."
"Is your work environment any different than others in your industry?"
"No."
"More vacation time, gym memberships or other perks?"
"No."
"So then why then do you believe it is your employees, and your ability to attract them, that sets you apart from your competitors?"
He hesitated and gave a puzzled look before saying he didn't really know.
This company president didn't know what attribute made his company successful. Most likely, his employees are no more or less qualified than others in his industry. And because he couldn't identify the attribute responsible for his success, he is more likely than not to stray from it or unknowingly allow it to waste 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, 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 and you should know how to identify it, nurture it and exploit it if you want to successfully grow.
As an example, let's review the core competencies of two well-known businesses, Domino's Pizza and Honda.
Domino's 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 way they selected store locations and ending with the delivery method. It was this value-added benefit (a warm pizza delivered quickly) that drove customers to choose their product over other pizza restaurants. Dominos continuously refined this process (their core competency) and kept 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, lightweight engines; first for motorcycles, then small cars, and the rest is history. Their continual investment in engine technology reflected how well they understood what made their product the preferred choice.
What is your company's core competency?
It is very rarely "our customer service" or "our people," as these are considered to be expected standards of most businesses.
Investing in your core competency will ensure it continues to provide you with the competitive advantage necessary to grow your business.
Mike Gomez is the President of Allegro Consulting, an Atlanta-based business growth specialty firm. Mike has helped companies large and small, international and domestic, plan and execute their growth strategies. Allegro provides operating advice to businesses and organizations on a wide range of management issues that effect growth, such as strategic and organizational planning, marketing, sales and business process improvement. www.AllegroConsultant.com.
