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Is your firm ready for these new competitors?

by Keith Dugdale

Everyone knows that in a B2B and B2C world, competition has never been so extreme. The internet coupled with a series of downturns in economies have significantly increased the competitive landscape. In B2C, we’re seeing apps being designed to scan bar codes in-store and tell the consumer where they can get their desired products the cheapest. Every B2B client that I work with tells me about how increasingly competitive their market is, how other firms are discounting to win work, how there are new niche entrants as well as large global corporates frequently arriving on the scene, ready to steal clients away.

While all of this is undoubtedly true, in my mind much of this discussion and concern has been far too narrow. Generally, they are looking at their historical competition and in some cases these new players. But what few seem to be able to do is look over the horizon at where the future competition will come from.

What might be?

Few organisations celebrate and reward the personal attributes of ‘what might be’. There is a line in Elliott Jaques seminal book The Requisite Organisation where he says that a person’s value to an organisation is determined by the length of his or her horizon. Whether that be their ability to see future opportunities or future threats, he says that having people who can look to the horizon and actually listening to them will help organisations make strategic decisions in advance of changes happening, rather than always playing catch-up.

Let me give you an example in the B2B world of professional services. In very simple terms, you could split professional services firms into four obvious categories (I know there are other professional services industries but I am just going to consider the obvious ones here):

  • Accounting/consulting firms
  • Pure consulting firms
  • Consulting engineering firms
  • Law firms

By and large they are partnerships or share owner organisations, with a scattering of listed firms in there for good measure. They largely measure input through timesheets, and have made their money from providing technical advice.
Even as recently as three years ago, each of these largely knew their market, clients and competition. This has changed, as we’ve recently seen predicted in the Future of Legal Services Report, and in the past 12 months we have witnessed more change than in the previous decade – perhaps triggered by varying economies or technology, or perhaps simply by desire or sometimes by need.

The new horizon

The result? We see firms traditionally known as accountants being listed in the top 10 law firms. We see Engineering firms setting up global management consulting firms. We see Law firms setting up management consulting firms. I’m pretty sure it is only a matter of time before one of the big 4 accounting firms buys a full blown firm of consulting engineers.

Why is this happening? Because of the recognition that unless the sales entity has relationships with the C-Suite, then their offering is likely to become commoditised. In fact, it probably already is. Hence the drive for law firms and engineering firms to develop consulting skills if not full scale consulting businesses so they have the ability (and confidence) to engage the C-suite, something in my experience they have frequently lacked. The big 4 on the other hand often already have these relationships, so their tendency is to add services that they can sell.
The relationship with the C-Suite that I’m talking about having is not a technical one. It’s a relationship where the provider is adding value to the life of the person in the C-Suite even if that value has nothing to do with their traditional offering. Relationships are of course also needed at all levels of the organisation through the people who run projects, sign contracts etc, but these are not the relationships that are going to help firms survive in this new competitive landscape.

So, who is your competition?

At the end of the day you are competing with everyone else on the planet who wants the time (and money) of your customers.

I suspect that the firms with the most potential to disrupt are not the biggest firms who may currently have the relationships, but those firms with the agility and vision to develop them and develop and adapt their businesses for changing times. So next time you’re sitting down to set your business strategy, or develop an opportunity strategy or client plan, think broadly about your competitive landscape, be bold, invite a person into the room who is naturally attuned to think ‘What might be?’. And then perhaps in 10 years time you’ll be known as the firm that truly disrupted the market.

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