D.Murali
Chennai: Do something new, something that is different from what your
competitors are already doing, say Anja Foerster and Peter Kreuz in
Different Thinking (www.vivagroupindia
that, at least for a short time, will give you the competitive edge
that comes from offering something unique," they add.
But isn't it often the case that companies decide in favour of the
quicker option of getting off the mark by copying someone?
Regrettably true, the authors observe. "This arises from the
assumption that being a pioneer is a very risky business." A
corollary myth is that it is really safer to quickly copy others than
to be the first one to offer something new and completely different.
You may wonder if some products can be so mature that any
differentiation would be almost impossible. Not necessarily true, say
Foerster and Kreuz. They cite the automobile industry for
example. "There is no such thing as a bad car any more, they are all
good! No matter which car maker you look at, whether it's Toyota,
Renault, Volkswagen or any of the others, nowadays they all have
state-of-the-
In today's markets, it is no longer a question of who has the more
powerful engine or the lower air drag coefficient, reason the
authors. "The area of differentiation lies elsewhere: design,
service, image, and people are important factors. And it is a
question of distancing yourself from the grey zone of mediocrity and
doing something that will take your rivals by surprise." Like Tata
Nano?
While the world's cheapest car may be for everybody, the case that
the book discusses in this context is of Bruno Banani Underwear, a
company with the marketing slogan, `Not for everybody.' Every month a
new model of their product goes on sale. But since the production is
in limited edition, there is artificial short supply, thus making the
company's underpants a collector's item. Also, it has triggered a
real cult using unconventional promotion methods. "Bruno Banani
underwear has successfully proved its tensile strength and good fit
in space, in nuclear research centres and under deep-sea conditions."
Price is an unmistakable differentiator, the authors note. Only, you
must not waste time in marginal variations but work on radically,
like Ryanair exemplifies. "They didn't focus on being 2 or 3 per cent
cheaper than the established airlines. They asked themselves, how can
we make our tickets 60 or 70 per cent cheaper?"
How do they manage to do so? "Customers book online, so the company
doesn't have to pay commission to travel agents. Ryanair drastically
reduces take-off and landing charges by avoiding the big expensive
airports and flying to smaller provincial ones. It aims for full
capacity utilisation of its planes, reduces ground time to a minimum
and so on."
Not too different were the measures that Girish Wagh and his team had
to resort to, in Tata Motors. "In came benchmarking, purchasing from
Internet auctions, outsourcing parts to more efficient suppliers and
boosting revenue by selling Tata-made dies to other companies," Robyn
Meredith recounts in an April 2007 article titled `The Next People
Car' in Forbes.
"E-sourcing idea has become routine for Tata," she adds. The
company "ran 750 reverse auctions on Ariba in the past year to bring
down purchasing prices by an average of 7 per cent for everything
from ball bearings to the milk served in the company cafeteria."
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