Every business aspires to be competitive, as a competitive business is one that has longevity. There are many ways to gain a competitive advantage for your business; boosting productivity, efficiency and quality of product/service. However, while all available methods have some level of importance, few are as effective or as readily available as IT.
What is the connection between IT and business competition?
As businesses interact with IT with increasing levels of depth and frequency, more opportunities for competitive advantage arise. Therefore, it is a foregone conclusion that an organisation that does not have IT integrated into its business model will lose to its competitors.
Using IT to build a competitive advantage for your business is not an easy decision to make. You will be required to consider a multitude of factors, which will take both considerable time and effort. However, if done properly, these decisions will net your business an advantage over the competition.
How do you use IT to build that competitive advantage?
No matter the context, the goal of IT is to solve problems. Broadly speaking, the process of building a competitive advantage with IT involves identifying problems with the business and then solving those problems using IT.
There is no specific technology that will guarantee a competitive advantage. Instead of trying to find the perfect device for your business, your focus should be using various kinds of technology solutions to ensure that your business is operating as best as it can. From there, opportunities for competitive advantage will present themselves.
Here are some of the ways that you can make your business more competitive using IT:
Enhance your corporate culture
Because employees make the backbone of your business, it is important to ensure that their needs are being met. To this end, you can use various forms of IT to:
- Automate processes so that your staff can focus on their own duties
- Allow your staff to work autonomously, as well as provide resources they can use to inform their work at their own discretion
- Streamline your employees’ tasks, making their work as simple as possible
- Provide communication tools where employees can provide actionable feedback, etc.
Not only do employees recognise a business with a good corporate culture, but customers do as well. Because a large percentage of consumers are more likely to purchase from companies that align with their values, businesses that have a reputation for treating their staff with respect will have a competitive advantage.
Provide accessibility for your customers
Customers want to interact with your business, but they will have little patience for a business that is difficult to make purchases from. This can be for various reasons, such as:
- A lack of purchasing options
- A defective website
- A lack of online shopping features
- Missing purchase information
- An inability to track purchases
- A needlessly complicated purchasing system
- A purchasing system that neglects customers with disabilities, etc.
If your business provides a less than satisfactory purchasing experience, then customers will turn to your competitors.
Establish your unique selling proposition
Businesses cannot be competitive without a unique selling proposition. By definition, a USP is what sets a business apart from their competitors. However, if your business operates within a particularly saturated market, it can be difficult to define your USP.
That is where technology can be an immense help, as it can enhance your business in many different ways that can be used as a USP, such as;
- A more efficient purchasing process than competitors
- More payment processes than competitors
- More convenient methods of communication than competitors
- More reliable and transparent customer service than competitors, etc.
That way, it doesn’t matter what your market is. Thanks to IT, you can present your products/services to your customers in refined ways that your competitors cannot.
Create your online presence
Businesses cannot be competitive without an online presence these days. As customers have pivoted towards purchasing goods and services online, businesses have forged their own competitive advantage through how effectively they accommodate them.
But, an online presence for a business means more than just a store. The way in which businesses interact with customers online can result in a competitive advantage, with various methods including:
- Conducting numerous sales and discounts
- Carrying themselves affably on social media
- Offering comprehensive customer service
- Giving customers a fully realised review system
- Collaborating with respected content creators
- Enhancing customisability for customers
- Integration with emerging technologies (e.g. VR, cryptocurrency, AR), etc.
Times have changed. Businesses that might have struggled to compete previously have been presented with an opportunity to stand out from their peers thanks to the constant innovation that technology represents.
Identify your strengths (and fix your weaknesses)
Another function that IT provides is data visualisation. There exist software solutions that calculate your various metrics (i.e. total sales, KPIs, review ratings, time spent on projects, etc.) and then have that information collated into formats that can then be presented to your employees.
This is an invaluable tool, because it demonstrates to your employees where they are succeeding, as well as where they can improve. Using this method to optimise your services will grant you a competitive advantage against businesses that don’t.
Additionally, your business’ successes can be presented to your customers to reassure them that they have made the right decision for selecting you over your competitors. Customers also appreciate accountability. If you can identify your weaknesses, and then commit to fixing them, your customers will acknowledge your efforts and match your commitment by continuing to buy from you.
Formulate your strategies
IT has changed the way in which employees can collaborate over projects by providing new methods of collaboration. Nowadays, you can conduct and transcribe meetings business-wide with ease, and this can be used to comprehensively outline:
- Your unified business vision
- Your goals used to achieve that vision
- Your strategies that will be used to achieve those goals
The competitive advantage this presents for your business is a fairly simple and straightforward one. A more cohesive business is more likely to perform better than the competition. If you operate with peak efficiency and effectively deliver your clients what they want, you will leave them without a need for your competitors.
How do you select the right IT tools for that competitive advantage?
So, you have decided on the business problems that you would like to use IT to solve. However, the next decision is equally important and difficult. Now that your goals are in place, you need to select the tools that you’ll use to achieve them.
Below, we have outlined some tips that you can use to make sure that you select the right technology for your business.
Identify what you need vs what you want
This is an important distinction to make.
- Your needs make up what you should look for in the immediate future. You should prioritise them because they exist to solve the problems that are currently facing your business and are therefore critical to your day-to-day operations.
- Upgrades to dated infrastructure
- Software updates with major bug fixes
- Technology that directly addresses missing functionalities, etc.
- Your wants should not be neglected, but they should be prioritised lower than your needs. This is because they still benefit your business, but they don’t solve immediate problems and are instead used to anticipate future problems that may arise.
- New hardware with better technical specifications
- Software that provides new functionality
- Experimental technology that presents new opportunities, etc.
The reason that you need to make this distinction is that prioritising the wrong technology can kill your competitive advantage. You might have implemented some impressive experimental technology with the potential to optimise your business practises, but your customers will not care about that if they are too busy contending with your broken website, or their inability to email your business, etc.
Determine the logistics behind your selection
There needs to be a purpose behind your IT decisions. Every time you look to new technology, you should be asking questions such as:
- What problem will this technology solve?
- Who is going to run and maintain this technology?
- What costs will arise from this technology?
- Will this technology integrate with my existing infrastructure?
- How will this technology benefit my employees/customers/the environment? etc.
Logistics are important because their answers determine what competitive advantage your business will get. You can purchase the most powerful technology, but if it integrates poorly with your existing systems or it makes your customers’ experience more difficult, your competitor with less impressive technology will be able to use that against you and poach your business.
Calculate your budget
This operates on similar principles as the previous point. You never want to spend money that you don’t have to, and you especially don’t want to spend money that you’re not going to make back.
So, while it is important to keep your systems up to date and seek innovation wherever possible, you have to make sure you budget accordingly. There is no point in spending exorbitant amounts of your budget on a really powerful piece of technology if it means neglecting other aspects of your existing systems.
While it might seem like a good idea in the short term to go for impressive technology that will seemingly put you ahead of your competition:
- Your systems may not be able to handle this new technology in the long term, causing major problems down the road that will require a lot of time, effort and resources to fix
- Your new technology may initially impress customers, only to then alienate them once problems in your customer experience present themselves
- You may have a headstart on your competition, but they might end up discovering a better version of your technology later on, giving them the perfect opportunity to steal your customers
Include others in the selection process
Think about who is going to be interacting with this technology the most and allow them to offer suggestions on what technology you should use; whether it’s your employees or your customers.
While this does not mean you are obligated to take their suggestions, this simple action demonstrates that;
- You value your employees/customers as equals, which they will recognise and consider when presented with your competition
- You care for their experience, and want to improve it as much as possible
- You share values with your customers/employees, which will resonate with them
- You take a rational approach to your technology, which assures your customers and employees that you are not trying to use extravagance to take advantage of them
Keep in mind; your choice in technology also affects the impression you give to your stakeholders. This should be one of the many things that you consider when selecting technology. If your approach does not take your image into consideration, your customers will turn to a competitor whose approach does.