Archives for posts with tag: Competition

To tender or not to tender, that is the question.

Whether ’tis nobler in the mind etc… when I worked in the sales effectiveness business, the golden rule was that your success rate for an unsolicited tender is between 0 and 5% – yep, a terrible return – for a host of factors too numerous to mention here. Perhaps for another post.

This is a statistic that should bring out the most sober analysis of how our business development time is best spent, but the truth is that it really applies to the private sector. The public sector is often duty-bound to go out to tender from a pretty low base contract value, and with increasing levels of sophistication at higher threshold amounts.

I decided to respond to my first tender in a long time last year. It was a pretty good fit for my skill-set, but it’s still an agonising decision to invest the considerable time into collecting references, getting legal documentation signed and writing the response.

I wanted to go through the process for the journey itself, to get a feel for it since it would better colour future decisions. I ended up winning the tender, and the reasons why you win are always invaluable when you do a ‘drains up’ – win or lose – with the awarding company.

Emboldened by the fact that I was batting 1,000 as the Americans would say, I promptly entered another tender, and lost it, thereby killing my excellent average.

So what can we conclude from this? My $0.02 is this. Unsolicited private sector tenders, don’t touch them. If you weren’t expecting it, you’re simply making up the numbers. Public sector tenders, if it’s a genuine project, and it’s worth it to you, and it’s a good fit, and you intuitively feel you’re in the top 3, it’s worth throwing your hat in the ring.

 

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“There are no competitors”. I used to be fond of saying this, especially in previous industries I’d worked in which were fairly commoditised and definitely got the thin end of the Porter 5 forces wedge. These industries were also fiercely competitive.

My point was really this: There are no competitors, only potential partners or customers.” There is always a possibility of working with someone rather than against them. It’s more productive, and better for the collective, greater good. Of course, one of my reasons for saying this was to re-position my company, and de-position the opposition, by making such a statement, implying that we were different, unique even.

To an extent this is similar to the process of challenging the status quo. When you can look at things from a fresh perspective, and frame the place where you compete in a different way, then you reframe your market, you create fresh categories for yourself and you forge a unique set of dynamics where you are the lynchpin or fulcrum around which everything revolves.

When you can do this, your competitors melt away. There are no competitors; only you exist in this space, and your value enhances accordingly.

 

 

It would be a lot easier to live in a business world without competitors. You could spend your time creating truly valuable solutions for your customer, knowing that you would get the return you deserve. In the real word, however, as you strive to maximise your sales and win as many of them as possible, you need to put in place the best strategy for each opportunity.

A lot of historical business strategy theory borrowed from the military strategist Sun Tzu, the author of The Art of War. He has fallen from favour somewhat in the last few years as business has moved to a more collaborative environment. ‘There are no competitors, only potential partners’ is a refrain you’ll sometimes hear.

Here, however, are three of the key principles documented by this Chinese warrior two-and-a-half thousand years ago, adapted for sales opportunities, that I think still have validity:

– Know your product (or service), your customer, and your competition, and you need not fear the result of a hundred sales opportunities
– Know only your product (or service) and not the customer or the competition, and for every victory gained, you will suffer a defeat
– If you don’t know your product (or service), your customer, or your competition, you shall succumb in every battle

In other words, do your homework and planning and your effort will be rewarded.

Clusters are good.

Clusters are good for customers, because there is competition for their business.

Clusters are good for companies because they provide a critical mass of talent that you don’t have to retrain.

Clusters are good for employees because there is competition for their talent.

Clusters = choice.  Just as a rising tide lifts all boats, a growing cluster raises the bar all round. That’s why all countries, regions and cities strive for industry clusters.

When you’re in a city that doesn’t have much of a cluster, you don’t have choice. Applaud the company that decides to be the first of its industry in your region. Then work to build the cluster.