Every business faces an identity crisis during its evolution. Executives of young companies are constantly questioning developing a differentiated identity in a saturated industry. Even pioneers in uncharted territory will, before too much time, have to find their voice.
Intense competition means you’re onto something good. In addition, it means your industry will shape you should you be not tenacious about defining yourself.
There are three fundamental strategies that are instrumental in distinguishing a company from its peers:
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The chance of achieving true value-driven business depends on your capability to recruit the very best talent in the market. “A” players want to work alongside “A” players, so there is nothing more important than creating a strong nucleus of talent. Hiring hastily during an inflection point of your growth could possibly be the kiss of death in creating a culture of excellence.
Nothing gets top-tier employees more excited than being challenged to defend myself against outsized responsibility, yet most work environments still stick to a stripes-earning, teeth-cutting, dues-paying mentality that stifles growth.
A great way we’ve been able to achieve attracting exceptional talent is by showing we make an effort to be considered a perfect meritocracy, unfettered by certain requirements around age or experience.
Adhering solely to industry standards and guidelines is a surefire way to camouflage a company available in the market. Businesses strongly positioned for long-term success have a tendency to believe adamantly that their industry’s guidelines have yet to be discovered. There can be an important distinction between questioning every industry assumption and let’s assume that every industry practice is flawed — this is a thin line between curiosity and arrogance. In the quest to innovate, leave no stone unturned. If the industry first got it right, turn that stone back over.
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For example, when we attempt to build Urban Compass, we aimed to innovate on three fronts:
Scope: some property firms tackle an extremely thin sliver of the true estate experience, we wished to create a product for the holistic experience – search, schedule, visit, purchase, move, and hook up to your brand-new neighborhood.
Technology: we wished to bring data and technology to an area in which no-one had found ways to harness these elements in a very important way.
Compensation: we challenged the assumption that agents ought to be paid on commission and piloted a salaried agent model, where agents received bonuses for delivering good customer support.
While we’ve gained tremendous traction due to our innovation on scope and technology, we discovered that our initial innovation on compensation was actually detracting value: it prevented us from hiring top performing agents who wished to take advantage of the upside of commission, and misaligned incentives for our current agent base, who were being paid to be nice, never to help their clients close deals. We’ve since turned that stone back over, and we have now match the industry standard on spending commissions.
This is an important lesson for all of us: Be exhaustive in questioning industry assumptions, be selective in challenging them.
Proclaiming the necessity to concentrate on value may appear to be a truism, nonetheless it is remarkably easy to forsake the road of substance.
Businessman and author Ben Horowitz aptly said to ensure that a customer to change to your product, it requires to be 10 times much better than the product they are using. The only method to ensure that is by using a laser concentrate on value and eliminating all distractions. This demands not merely discernment between value and distraction, but requires the discipline never to pursue the distraction.
As a company, you’ll face this challenge each day, and sometimes the decision is between less engaging tasks to create value or even more interesting tasks destroying value. Making the decision to choose substance over splash is crucial in creating a deep, unique product.
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