HAPPY CUSTOMERS: The Best Defence against the Competition
By J. N. Halm
Your product can be copied,
your price easily imitated,
your place ferociously invaded
and your promotions effortlessly re-created;
but Exceptional Customer Care, Always! will always be hard to beat.”
(J. N. Halm)

So finally, the month-long football fiesta is over-the Iberians have been crowned worthy winners and talks of a Spanish dominance have already started permeating the football atmosphere. After all, they now carry both the European and global trophies. Ghana’s participation will go down as one of the most admirable and it is fact the history of Africa’s first World Cup will be incomplete without a mention of the exploits of the gallant Black Stars of Africa.
The story will have been much sweeter had it not been for the fact that the Uruguayans came on to the pitch in that epic quarter final with two ‘goalkeepers’. This fact goes to attest the resurgence of Ghana in the beautiful game. I am convinced that beyond the first round a team could only beat the Black Stars if it had two goalkeepers on the field of play.
Anyway, I am not one to cry over spilt milk. It is all in the past. However, I cannot speak about Ghana’s participation in SA 2010 without special mention of our back line. Conceding four goals in five World Cup matches is no mean achievement. Just ask the likes of the North Koreans and even the Mighty Brazil. We had a good defence and it came in handy when the going got tough. The key to winning is in having good defences.
Talk of competition and defences brought my mind home on the intensity of the competition in business circles in Ghana. From the fierce mobile telephony war zones, through the battlefields of life and general insurance, through the banking terrain to the relatively new battlegrounds of the traditional and herbal medicine, it seems the competition within industries will continue to boil. What are the best measures a company can adopt to defend itself admirably against its competitors?
Business school teaches us some competitive strategies that businesses can adopt to beat off the competition. However, the fact remains that outside the walls of academia, there is a reality check. In a cutthroat and intense competitive market, much of what we learn in school does not seem to do much good.
After some in-depth reading into several competitive moves and after talking to a number of business leaders in the community I came to the sad conclusion that these strategies might work, but only for a brief period of time. In seeking an advantage over one’s competitors, many of the competitive moves fall short in the long run, especially in an environment like ours where some of the basic laws of business seem not to apply.

Price Wars do not last
Competing on prices has been proven to be just a temporary measure. Price hikes or price dips do not stand the test of time. Eventually, competitors find that they have cut away so much flesh from their profits that they become “financial skeletons”, barely able to stand on their own two feet. This is what might result in the insurance industry in this country if the trend of undercutting continues. With the way some new entrants in the general insurance are aggressively going about their business, pretty soon payment of some claims might become problematic. I hope the NIC is doing something about this disturbing trend.

New Inventions become old, sooner or later
When IBM introduced the PC in late 1981, I am sure they thought they had gotten a cash cow that will provide them with milk for a long time. However, barely two years later, other manufacturers had introduced “clones” that were matching IBM’s machines. By 1987, IBM’s machines accounted for less than half of all PCs sold worldwide. Sooner or later, someone as smart as you are, or even smarter, will take your invention, make changes on it and sell it on the market at less than half the price of yours.

Technology has its limits
I remember when the first ATMs were released into the banking sector; the few banks that had it were making sure that we all knew they were the ones with the ‘machines’. It appeared in all their communications. A few years down the line and it has become the norm. Investments in automation hold off the competition, but only for a while. Development of entirely new processes and changes to old processes might give a firm some competitive advantages but these have limits. I read quite recently some studies indicating that 60 to 90 percent of all new technological breakthroughs leaks away to the competition within a very short period of time.

Smart New Executives matter little
The human resource of every organisation is vital to its long-term success. This is fact that very few will attempt to debate. I believe it is for this reason that each and every edition of this newspaper carries faces of new executive appointments.
“Mr. A has been appointed the new CEO of ABC Company Limited. Before this appointment, he was the Deputy MD of XYZ Company.”
When a well-known face crosses carpets it definitely sends shivers down the spine of industry players, especially direct competitors. However, as has been proven time and time again, smart executives matter very little if their smartness is not translated into increased profitability for the company. The competition eventually strategizes to face the ‘new’ competition with renewed vigour. Interestingly, in many of these cases, someone emerges from the ranks of the old company and proves to be smart(er) and ready to hold the fort. Other times, a smarter executive is ‘poached’ from another industry to join the ‘fight’.

Lower labour costs do not lower the competition
We all appreciate that labour is vital to an organisation’s overhead. An organisation that is able to lower its labour costs eventually gains a competitive edge. In the 1960s, the Europeans were offering the Americans stiff competition due to their lower labour costs. In the 1970s, the Japanese started beating the Europeans on the lower labour costs issue. From the 1980s up till now, the Japanese are being given a taste of their own medicine as the Chinese are prepared to work for far less. In fact it is not only the Japanese that are running scared of the Chinese, the whole world is. Because there is always someone willing to work for less money, using lower labour costs as a competitive move is not sustainable.

Marketing Strategies are not enough
Recent occurrences in the mobile telephony industry prove that inventive marketing strategies were not enough to beat off the competition. I recall the early days of mobile telephones in this country-the days of MobiTel, OneTouch and Spacefon-when SIM cards were so exclusive that only the ‘privileged’ had access to them. A decade or so down the line, and SIM cards are being marketed like ‘agblikaaklo’ on the streets of Accra. I find it pretty interesting, that these days the marketing strategy for SIM cards and accompanying mobile phones is with much fanfare-young men and women clad in branded Polo Shirts dancing on the streets or on trailers to attract attention. It does not take too long for competitors to jump on a single strategy and “flog it till its dead.” These days, music and film producers all seem to have adopted a strategy of selling their CDs and tapes in small vans with irritatingly loud speakers.

Markets are not yours forever
We are told that another way to beat off the competition is to target a specific market and serve them so well that the competition will only play catch-up when it comes to that market. ‘Niching’ is helpful, but only up to a point. Procredit and other such non-banking financial institutions made the informal sector their domain until the ‘big boys’ started looking in that direction. In the US, Wal-Mart stores made small towns their niches because the larger chain of supermarkets did not find those markets very profitable. However, decades later those small towns grew into larger towns and that was when the ‘big boys’ stepped in. Wal-Mart’s competitive advantage disappeared into thin air.

Regulations do not protect forever
In order to beat off competition from across borders, indigenous businesses often call on their governments to help stave off the attacks. The decline of Ghana’s textile industry in spite of regulations is a testimony to the truism that governmental interventions are, at best, temporary ways of fending off the competition. I recently read that in spite of the heavy protection of the Japanese computer industry, IBM holds 45 percent of the market. Dr. Milind Lele in his book, The Customer is Key, puts it best; “If there is a market worth having, competitors will find a way around and all regulation.”

So, what is the best strategy?
The best strategy is the one that keeps customers happy! As can be discerned from the preceding discussion, competitive moves are at best temporary measures against the competition. A business that makes customer satisfaction, an overriding goal that seeps through the entire organisation is virtually indestructible. No amount of competition can kill that business. Interestingly, whilst others are engaged in price wars, such great companies can even increase their prices and still maintain their loyal band of customers. While their competitors lose clients because of a change in technology, the customers of the great companies are patient to wait while the business adopts and adapts to the new technology.
Organisations in which customer satisfaction pervades the entire fabric of the organisation-where considerations of the customer’s satisfaction are factored in product-service design, manufacturing, sales, after sales care, etc-are the real winners. Companies that make the provision of superior customer satisfaction the cornerstone of their entire existence will always win.
As stated by Dr. Lele, great companies know how to
“……… maximise customer satisfaction and thereby obtain higher profitability through the ability to charge more for its products than its rivals, obtain more repeat business, and reduce its marketing and sales expenses.”
So, if your intention in business is to beat off all competition and rise to the top, make the maximisation of customer satisfaction your priority. If you manage to pull this off, your competition will need more than two goalkeepers to keep you from beating them.