It’s that time of the year; strategies for next year has to be prepared and everybody is getting ready for their – most often – top-down budgets and actions required next year to reach these budgets. We’re taking a look at the SWOT, competition, positioning models and maybe we even use the classic five forces to confirm our understanding of the market. Business as usual, in other words

How much do you look at the startups in the near-field areas of your business? Very little, I guess, if at all. And how much attention do you pay to start-ups in far-field areas of your business? Not at all, I guess. But you should, of course. With the pace of business development and disturbance / disruption from unexpected areas and new entrants, it is no longer enough looking at the players you’re already comfortable with

If you don’t, be sure your competitors will

When you’re planning to grow your business, you must look outside your near-field industry and be inspired by what far-field business are doing and either a) take the best ideas and implement in your business or b) prepare for your competitors doing it. Gone are the days where it suffices to look at best-practice within your own industry. If you insist on only looking at what your best close competitors are doing, you’re “comparing your horse to other’s horses and ignorant to the car being introduced next door”

In well- and long-established companies, it can be difficult to convince the higher management that this is case, that you’ll need not to look at what your classical competitors are doing, but take a hard look at what’s happening around you in order to get a realistic idea of what will happen in the near future. Why? Because if there is an opportunity to get a market share by introducing something new, or the same in a new way, someone will. That’s the markets of today and that’s the reality that we all have to deal with

Don’t be fooled into believing you have a value chain and core competences strong enough to face off competition. This was 10 years ago. Today is the age of partnerships across channels, business and even competition so if you want to see what’s coming, imagine your competitors joining forces and partnering with other companies that excel in delivering just bits and pieces of the entire value chain

I wrote another post about the new value chain ecosystem that can help you assess how your value chain can be constructed in the future and how you can continue to deliver value to your customers


Near-field and far-field industries

Near-field to your business are companies in your industry and industries very similar. It’s businesses that manages similar topics for the customers. I’ve before mentioned insurer and banks (these businesses manage money / finance) as an example and another is advertising / public relations (managing brand / reputation) as two other near-field businesses. It’s related industries that typically shares regulations and are seen to work closely together

Far-field businesses are outside your industry but with similar customer groups to your industry. For retail insurance, this could be online retailers or lifestyle magazines targeting the same customer segments. Depending on the level of globalization level of your industry, far-field business could also be similar business in other regions of the world. This would be far-field if the rules of the business game is very different from region to region – again, the insurance industry is a good example of this as regulations are very region specific

 

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