Find Your Competitive Edge

In this episode of "How To Sell More," we're joined by Dr. Chuck Bamford, a straight-talking business strategy expert. Dr. Bamford breaks down the key differences between strategy and planning, offering game-changing insights for entrepreneurs and business leaders looking to stand out in their markets.

Dr. Chuck Bamford wears many hats - he's the managing partner at Bamford Associates and teaches at the University of Notre Dame. With over two decades of experience teaching strategy and entrepreneurship, he's authored six strategy textbooks and won numerous teaching awards. Today, he's here to share his insights on creating practical strategic plans that drive real business growth.

• Strategy vs. Planning:  strategy is about getting customers to choose you over competitors, while planning is about the nitty-gritty of making it happen.
• Start with Your Competitors: To build a solid strategy, you need to understand what your competitors are up to.
• Find Your Unique Edge: Discover what truly sets your business apart and use it to your advantage.
• Spread the Word: It's not enough to be different - you need to make sure your customers know why you're the best choice.
• Lead the Way: Strong, consistent leadership is key to making your strategy work.
• Keep It Simple: Avoid overcomplicating your offerings - focus on what's valuable and cost-effective.
• Mission and Values Matter: Your company's mission and values should guide your strategic decisions and shape your culture.
• Systems for Success: The real competitive edge lies in having solid systems that consistently deliver on your promises.
  ‍

Dr. Chuck Bamford's path from academia to hands-on business strategy consulting shows his commitment to helping businesses succeed. His vast experience and research-backed methods prove that a well-crafted and executed strategy can transform a business.

"Strategy is about getting customers to walk past your competitors and choose you. Why would they do that? What truly sets you apart?" -- Dr. Chuck Bamford

‍

Links to This Episode

• Apple Podcast
• Spotify
• YouTube
• Audible

‍

Key Takeaways

• Differentiate Strategy from Planning - Recognize the difference between strategy (focusing on competitive advantage) and planning (implementation steps) to enhance your business approach.

• Identify and Communicate Unique Differentiators - Focus on specific, tangible factors that set your business apart and ensure these are effectively communicated to your customers.

• Leverage Systems and Standards - Implement robust systems and standards to maintain a sustainable competitive edge, ensuring consistent delivery of your unique value propositions.

‍

Top 3 Reasons to Listen

Clear Strategy vs. Planning Distinction: Learn how to tell strategy and planning apart to boost your business approach. Dr. Bamford offers practical examples that'll help you focus your strategic efforts.

Competitor Analysis: Studying your competitors is key to informing your strategy. Dr. Bamford shares tips on using competitor insights to gain an edge.

Stand Out and Speak Up: Identify what makes your business special and how to effectively communicate these advantages. Dr. Bamford stresses the importance of clear communication in convincing customers to choose you over competitors.

Follow Dr. Chuck Bamford on Social

Website: https://www.bamfordassociates.com/

Link to Dr. Bamford's' Books: https://www.bamfordassociates.com/books

LinkedIn: https://www.linkedin.com/in/chuck-bamford-ph-d-67b9811/

‍

More About Today's Guest, Dr. Chuck Bamford

Strategy Adviser & Managing Partner | Author

Dr. Chuck Bamford is the managing partner of Bamford Associates, a firm focused on developing practical strategic plans and working with companies to implement those plans throughout the organization.  Before earning his PhD, Bamford spent twelve years in industry. For the past twenty years, he has taught strategy and entrepreneurship at the undergraduate, graduate, and executive levels.  He is currently an adjunct professor at the University of Notre Dame and has won eighteen teaching excellence awards, including nine executive MBA Professor of the YearAwards and has been named a Noble Foundation Fellow in Teaching Excellence.  Bamford is the author of six textbooks in both Strategy and Entrepreneurship.  His research studies have appeared in the top journals of both fields and he regularly contributes to news organizations.

‍

A Transcription of The Talk

Mark Drager: Chuck, you are well known for your practical business strategy, and your insights. And what one reviewer said for your book was a no-bullshit approach. So I know that I like that. I know that my listeners like that. So where I would like to start, because business strategy, gosh, strategy planning, people talk about strategic planning, I want to start at the very basics because I've been in business for now 18 years. And I was listening to a Harvard Business Review video the other day, that talked about the difference between strategy and planning. And I realized that perhaps, I'm 18 years in business, and I didn't even know that there was a difference between these things. Can we start with what the difference is between strategy and planning and why we get this so confused?

Dr. Chuck Bamford: Well, I think people overcomplicate strategy. So strategy at its very core, I think, is relatively straightforward. It's about getting customers to go past your competitors and buy from you. Why would they do that? Right? Why would they drive past a competitor and buy from you? Why would they seek you out and not seek out one of your competitors? What is it that separates you? And in my opinion, strategy's got two pieces. Half of the strategy is not frustrating your customers, and the other half of the strategy is not pissing off your customers.

So, customers expect certain things when they come to purchase from X, whatever X turns out to be. They expect certain things. We just need to be level with those things. We just need to be not bad at those things. We need to accept credit cards, we need to be able to respond quickly. I can go down a long list of things. It depends on what the company is. And then the other part of the strategy is, tell me what truly separates you. And we know it's not silly things like our people, or quality, or customer service, or these other things. What is it that truly separates you that would get a customer to go past competitors to buy from you?

And then Mark, I guess my take is planning is putting it all together so that it actually implements. But I guess I don't really know.

Mark Drager: Well, to fill in the audience, here's what the Harvard Business Review breakdown had. It was that planning, people get caught up in because it's the "what are we going to do this quarter to make it happen." And they often overlook strategy completely. And they took it a step back to say strategy is a vision. It's a list of assumptions. It's a creation of if this were to happen, these other things would have to be true to be able to make this happen. And if you find that you're three months in or six months in, and those things that you assumed to be true are not becoming true, then you can adjust your strategy from there. So I don't know how that hits you. But that's what their explanation was.

Dr. Chuck Bamford: Yeah, I mean, I kind of like pieces of that. I mean, we would certainly argue that we start with strategy by looking at what the competitors are doing, looking at what we think are our Northstar goals, what it is we're trying to achieve. But I guess where I would maybe slightly differentiate or separate from that kind of thing is I think the strategy is about really figuring out how to get new customers, how to grow the business in such a way that customers will want to come to you.

Mark Drager: Now, I have heard you say, and you just briefly mentioned it, that strategy starts with the competition. It starts with looking at the market, looking at the competitive landscape, looking at perhaps what others are doing well, and whether we want to go head-to-head and fight a battle with entrenched people or whether we want to look for whitespace or new opportunities that have maybe yet to be explored. Can we go further and faster by doing that?

But often, I find, and I'd love to get into this with you, that strategy needs to start with the leader. A business, depending on the size, certainly, but if we're dealing with small or medium-sized organizations, will only be able to grow to the levels of leadership's thinking, to leadership's confidence, to their ability to make investments and make smart decisions, and really their comfort zone.

So I always prefer to start with, what are we building? What is the vision? What are the goals? What do you think is achievable? And then we can look to our target audiences, our target customers, and our competitors to almost validate if their beliefs are true or not true, if their thinking is correct or not correct, or if there are new opportunities to spot. How does my assessment strike you, and why might I actually want to start with competitors versus the leadership?

Dr. Chuck Bamford: Yeah, I don't know. Maybe it's a chicken-and-egg question because I think you need both. You can't have a quote, a great leader who understands people and understands what needs to be done, is willing to hold tight, and actually grow and make the commitments if they don't also have an understanding of what the competitors are doing. How are the competitors winning? Why do competitors have a business, right? I think that's one of the questions everyone should ask: Why does a competitor have business, and why would they buy from me?

So I do think that leadership is crucial. I won't work with a company where we interview and talk to the CEO and the leadership team if they're not committed to doing these kinds of things. If they're not going to really put forth the effort, if they're not willing to engender the discussion that might hurt their feelings in the room with their people, and they might be offended if they find out that competitors are really quite good and they're not terrible. If that's the case, we've got a problem.

So I like what you're saying, but I think for me, leadership is a lot about consistency, willingness to push through, willingness to listen and understand. But also, at some point, somebody has to make a decision, and they're the ones that have to be able to do it. Then we've got to have that. So I think there's a yin and yang that kind of ties those together.

Mark Drager: So let's imagine that I'm the leader of, let's say, a robotics manufacturing company or control systems company. You know, I have great people, I've been in business for years. But I do a lot of things, and I don't really know what's working. I don't really know what's not working. I don't really know what we need to do to fix it. But I know that I need more. I need more sales, I need more customers, I need to be able to increase my margins, my market's commoditizing. Lots of stuff is happening around me. What would you say? If I came to you, what would be the next parts of our conversations? What would be the next steps? What would you tell our listeners? How would we work through this?

Dr. Chuck Bamford: So I like the way you started that. I think one of the things that we do quite often is we say, let's take every single thing you've been doing and talk to me about what revenue has been over the last three years in each line item, by line item, by line item. You also could do it based on profit margins or other things, line item by line item. And let's identify those that are causing us real issues.

One issue is, what truly separates us? When we look at the company as a whole, what really separates us? It's rarely products; it's more things like how fast we're able to do something how well we are able to connect with the customer, or how much effort we put into ensuring that it's 100% quality before it goes out the door. It's usually something else. There are things that we do that we can then use to separate us from our competitors. Then the question becomes, how do you apply those things to each of those lines?

There might be lines, honestly, Mark, that helped us get to where we are today that have no future. There's no market potential for it; there's no real growth opportunity. And we can either do one of two things: continue doing it if we're making money on it while we're able to do something else, or if there's a real runway, given what we think our advantages are, let's do something different with it.

A lot of my clients are private equity firms who acquire nice portfolio companies, and then they go, "We need someone to come in and help them figure out how to grow." What I care about is how you're going to grow. How are you going to 2x or 3x your sales? Let's presume you know how to hold on to your current sales. So what is it, where's the runway, where are the things that are going to give us a real runway? And then we simply make a decision on all the others. Despite the fact that this is how we got here, Chuck, we love it, don't make us give it up. We have to give up things that we've exhausted. That's tough.

Mark Drager: I have a client who is in manufacturing. They do something really amazing. They do just-in-time manufacturing, but they actually allow their clients to order all of the materials. They flat-produce everything but don't assemble anything, don't finish anything, or ship it out until it's on demand. This allows customers to lock in all of their current pricing, even if they're going to have batch releases over the course of 12 months or 18 months. This allows customers to completely lock in against inflation, against any kind of changes. And they charge no storage fees. They do this because, from their perspective, it's just the right way to go about business.

But they don't really talk about it much. They're afraid their competitors are going to copy them, that their competitors will do the same thing. So I'm like, what? What an amazing thing that you do. They find themselves getting squeezed on pricing. They find that an older generation they had a lot of relationships with is retiring or moving on, and a new generation of purchasing agents and others are coming in who want to look good and save their company money. They want to squeeze everyone; they don't care about relationships. These are very common challenges in a lot of industries and organizations.

A big pushback I get, and I'm curious if you see this, is, "I don't really want to put this out there because this is our secret sauce, and everyone is just going to copy me." I heard maybe in 2006 or 2007 when I was starting my career, a speaker said, "You're either teaching your competition or you're learning from them, but you can't sit on the sidelines. So you're going to have to pick one." What do we say to those who feel very uncomfortable putting all of this out there, afraid that our secret sauce will just be picked up and copied by everyone else?

Dr. Chuck Bamford: You know, back in the 1980s, when the resource-based analysis was really coming to the forefront and we were putting SWOT behind us, one of the elements of it was a lack of understanding of how we had a competitive advantage. We liked that obscurity that helped give us some protection. What has been sort of really found out over the last 15 years or so is that you have to put it out there. Because I want the customer to choose me because I do this. I want them to choose me because of this. The only way to do it is to put it out there.

What we hope is that the multiple things in durability, right? So you were talking about something that is relatively rare compared to the competitive set. Very nice. Then the question becomes, how long can you hold on to it? What's the durability of it? There are three elements to durability, and it's about that detailed understanding.

One is that it would just cost too much for your competitors to do it. They don't want to do it. Another one is that it would take them a lot of time. All their systems are built the current way, not the way you were describing with the manufacturer, right? They're not built that way, and it's just too time-consuming for them to go back to it or change to that. The third one is they think you're stupid. That's my favorite one, by the way. They look at what you're doing, and they go, "No, I'm not going to do that," which is perfect because any one of those gives you more runway.

So I had a client very similar in a way, Mark. We got through the entire strategy retreat. They had something compelling; it was rare, it was durable, it was non-substitutable, they could charge more for it, it was valuable. And they didn't want to tell anybody. The CEO literally said, "This is great, Chuck, thanks, but we don't want to tell anybody about this." And I'm like, no, no, you have to tell people. Why would a customer do it if you don't tell them? "Well, they'll figure it out." Oh no. Oh no, that's the worst. When are they going to figure it out? How are you going to draw new customers? Word of mouth, about what? About what we do?

So you're telling them anyway. I failed after an hour and a half; I gave up. I just said, fine, okay, then that's what you guys are going to do. By the way, they've kind of wallowed for the last five years, even though they're spending an enormous amount of money on something that truly does give them a competitive edge.

So I think the piece that I thought was interesting about what you brought up is that I want to charge more for this, Mark. I will do all this, I will give you a consistent price, I will lay this groundwork, but it's going to cost you. To do this, I either want more of your business, I want you to guarantee something for me, or I want something in place for me to do this for you. Hopefully, there's also a cost structure issue, which I think there probably was for them, and they get a better basis point run along the way. So I firmly believe you have to shout it from the rooftops and hope nobody can match you.

Mark Drager: And on that point, can you over-engineer your products or services to the point where you've over-differentiated them? And by the nature of that, you've made it slower or more expensive? Like you're doing everything right, right? Like it's the best of the best of the best. But frankly, no one's willing to pay for the best of the best of the best. And then you just price yourself out of the market. Is that a risk?

Dr. Chuck Bamford: Of course. Oh my gosh, yes. Right. And it's all about what that customer set wants, and what are they willing to pay you for. Yeah. And I do think you're right. I think people keep tweaking and tweaking and tweaking, and it becomes unnecessary.

Mark Drager: So I know one thing that is often quite confusing, and I find this confusing as well. Now, I'm a brand strategist. I feel like this is my job to know this. So listeners, please forgive me. But everyone gets caught up in mission, vision, and values. I mean, I use a lot of this terminology because I feel like core values go, again, to leadership. It goes to the vision of what we're building, it sets the culture, it will define who you will work with and who you won't work with, who you will hire and who you won't, and who fits.

So this is really important stuff. It's not important to go through an exercise and come up with 14 different points that you hope people memorize and then throw up on a wall somewhere. But if we're speaking just about strategy and differentiation, and why people pick us, we have a mission, we have a vision, and we have values. I know what matters to me, so that way I can help create, again, the culture and everything else. But does it really, if you can articulate it, does it really matter?

Dr. Chuck Bamford: So I'm a relative fan of the mission. And then it's kind of like, if you want to do the other two, let's talk about it. So let's start with vision. I think the vision is nice. If you can come up with a compelling vision that people really want to be a part of and go, "Wow, I really want to be a part of that." It'll help you recruit people, right? There's no question about it.

Mark Drager: As long as you live up to the promise. It's usually aspirational, and it's usually something that gets someone excited who's in leadership, but everyone else?

Dr. Chuck Bamford: Yeah. So if there is something there, then I think it has value. I think people worry too much about crafting all those things. Let's skip the mission for a second and go to values. Most are garbage, right? Almost all of them are things like, "We have to be trustworthy and honest. We have to care first for our customers. We're mission-first oriented." And it's like, you go and interview them, and they're not any of those things. So they're garbage values.

If they were real—and some organizations I've run into, and I'm sure you have too—they're real. Like, they only have three, right? But I want transparency, and they mean it, right? Or, "We will do what the customer needs." And whatever those are, if they've got them and they truly permeate the organization, then it makes strategic change a lot easier. Because now when things go bad, I go to the group and I say, "We got to make this change, but we're holding true to our values." And everybody goes, "Okay," and they do it.

I think one of the keys to success is not a great strategy; it's your ability to change your strategy. Whenever you read anything that I write, a lot of what I write, I usually put a date on it. You know, "McDonald's was great here, this strategy was great here," because it's just for brief periods of time. It's those rare organizations that can continue having a great strategy, a little hiccup, another great one, a little hiccup, another great one. And they're usually ones where the values have permeated the culture of the organization. It is a real culture, and it enables me to make strategic change faster because all strategy is about getting all of my employees moving in relatively the same direction. That's the whole game of strategy.

I've always argued you could have a terrible strategy. Terrible. But as long as you're all moving in the same direction, you're probably going to make some good money along the way. So, to me, Mark, the mission is where I think we can play it. The mission is, how do I win now? Right? Why do I win business now? Why do I beat my competitors now? What's the mission?

Mark Drager: Is it my mission? Is it my mission applied to my customers and my clients? This is the stuff that I get lost in the weeds about.

Dr. Chuck Bamford: Yeah, I think that's it. It is always applied to the customer. So I think you've got that right. It's always, "Why would a customer choose me now?" Why do I exist in this industry, and why am I going to be successful? And I say the company, I don't mean "I." Why are we as a company going to be successful? What separates us? And when they say things like, "Well, we just make really good stuff." Okay, so does everybody else. "Well, we really take care of our customers." Yes. Name the company that says, "Man, I'll tell you what, our goal is to piss off our customers, and that's what we try to do." I mean, nobody admits that. They all claim the customer is first. Ryanair—oh, geez, alright. Ryanair doesn't claim that. Ryanair says, "We will use—"

Mark Drager: They don't care about the customers that much, but you know--

Dr. Chuck Bamford: I flew Ryanair, flew one round trip, and swear to God, I would never do that again in my entire life. But Ryanair doesn't try to, right? They don't try. They make no effort whatsoever. And everybody knows them. Okay, you're right. There are very few companies that try actively to piss off their customers. But the mission, if you want to have one, then it's got to be real. And it's got to be about what separates us, what makes us where we want to go. And then I turn it over to marketing people, Mark, to turn it into a slogan, turn it into how do we market it? I have no idea how to do that. I do have not a marketing bone in my entire body. But I love it when we can craft it together and say, this is it.

What a lot of companies have done is go away from mission and vision and move more to like Northstar goals, right? You've heard all this before.

Mark Drager: Yeah.

Dr. Chuck Bamford: So, and that's become a very big thing. Give me two or three bullets. Tell me what our Northstar goals are. Okay. I got it.

Mark Drager: You've touched on this. The idea is that your employees are not your competitive advantage. Earlier, when we were speaking, it was one of the things that you mentioned. I struggle with that. I struggle with that idea because certainly, if you don't have the right set of employees in the right roles, and they're all not moving in the right direction, of course, you're not going anywhere. But we've specifically focused my agency, my work specifically focuses on people-driven organizations, professional services, specialized services, and often the very magic, the very thinking.

You know, I was sitting down with another leader over the weekend, and they were going through their systems. And they said there was nothing at all that makes them unique. But I wanted to know, for their specific account managers who are really more like coaches to help clients succeed, I wanted to know what would make someone in that role excellent. And what do they know that we don't know? What do they think that we don't think? What do they do that we don't do? And if I could understand why the account manager in that role would lead to a successful outcome for the client, there's magic there, there's something there. And so to me, the right employee in the right role is a competitive advantage because they're doing something that hasn't been standardized. And if we can take that to market, then that's amazing.

Dr. Chuck Bamford: Do you mind if I poke you here for a minute, Mark?

Mark Drager: Yeah, please do.

Dr. Chuck Bamford: So I don't disagree on the fundamental. The fundamental is that all strategy is implemented by employees. Without employees, I don't get anything, and I don't succeed anywhere. I have to have a successful implementation, right? Employees? Ooh, that's a tough one. Right? So how do I know that they're right or they're wrong? I would argue that every time you've gone out to hire somebody, you have hired the person who you thought was the right person. I'm a 50/50 hire. 50% of the time, I get somebody who does a great job, and 50% of the time, I've got to fire them within 90 days. I'm terrible at this. So if I argue that it's your people for a second, then the fact that Joe is the employee delivering that, then Joe is my competitive advantage. What happens if Joe leaves the company? Right? What happens if Joe dies? What happens if Joe goes to a competitor? We don't go, "Well, that's it. We're out of here. The job's finished. Joe left. I'm closing shop."

Mark Drager: No, we're gonna... but if Joe was really good at his role, yeah. If you went to go replace Joe, would you not look for someone equally capable? Or would be, would absolutely be the curator of your people, and so half of them you have to let go because they don't live up to snuff. And the other half, you have expectations, and you have standards. Sure. And by holding everyone to those standards, is that not a competitive advantage?

Dr. Chuck Bamford: Yes. But now it's the standards that are the competitive advantage. It's the systems that you put in place, it's the training, it's the expectation you have, and then quite honestly, without being mean, it doesn't matter whether it's this employee, this employee, this employee, or this employee, or if we lose these three employees, we're going to replace them. We'll lose a little along the way, but we will replace them.

If you go to a restaurant, and you've gone to the same restaurant every single month, and you have your favorite waitress at that restaurant, right? And you show up at the restaurant, and your favorite waitress isn't there, you don't go, "Well, that's it. I'm not coming back. I'm not going to come here tonight." You're like, "No, we're already here. We got reservations. Let's go ahead and eat dinner." And stunningly, there's a waiter or waitress who is just as good as them, delivers just as well, and you think to yourself, "Wow, that's really good." So the systems we put in place, the knowledge, the training, the expectations of delivery, are all there, but it's not the person. It's a competitive advantage. It's the thing we're doing that is the competitive edge, and people are how we deliver on it.

Do you want good people? Yeah, I want good people. But I mean, we constantly try to hire good people. We fail a lot.

Mark Drager: I see what you're saying now, and I appreciate that differentiation or that difference, actually. Because when I look at employees and I see your employees, again, I'm not thinking that's one specific person we're going to hang our entire hat on and build our entire organization around, as opposed to, again, the people, the systems, the expectations.

So this has been an amazing conversation. I hope everyone listening has gotten a lot out of it. I do have one final question for you. So if you were to give us one tip or strategy to help each of us listening sell more, what would you suggest we do?

Dr. Chuck Bamford: I guess I have to do one that's going to sound repetitive. But dig deep. Get below the concept level that we stand on all the time. "Well, it's customer service, Chuck," or "It's quality," or "It's..." Get below that concept level and say, "Okay, customer service, right. What is it? Well, we do this. So does everybody. We do this. So does everybody. We do this. Yeah, they all do this." Well, Chuck, what separates us is this, this, and this. And I go, "Whew, now you might have something." So we go investigate it, figure out if it's really rare, durable, non-substitutable. And then we go back to all of our customer service people, everybody, we say, "Look, we do great customer service. We do all the things our competitors do. But what separates us are these three things. So in every interaction with a client, I want these three things to come out because that's going to be what the differentiator is." So it would be to get below concept levels where everybody feels comfortable talking and get to the nitty-gritty of the things we actually do.

‍

‍