Printer Friendly
View as PDF

A “Peerless Competitor” is a company that is not just successful but stands alone when measured against their competitors.  This brings to mind a “peerless” company or an organization set apart because it is built on a solid structure, similar to a pyramid.  My previous articles have focused on the base needed to build your company; financial resources or capitalization, which must be adequate to support the rest of the company.   Undercapitalization is a significant reason for business failure and available capital must be adequate to accomplish your basic business goals. 

Tracking cash and other assets requires a formalized accounting system that is used to protect these assets, ensuring that financial resources are used to accomplish the mission.  If you have successfully built this solid base, then product/services can be developed with the knowledge that they can be financed and supplied to your customers.  Marketing and sales is the way you get your product/service into the hands of your customers in exchange for their cash.

Download larger version of the Peerless Pyramid

Thomas Watson Sr. in 1914 became the CEO of a small company called Computing Tabulating Recording Company, a firm that specialized in selling measurement devices for businesses.  In 1924, he changed the name to International Business Machines.  He characterized this as a “big name for a small company.” Eventually he built the company to live up to its name.  Watson believed that in order for a small company to grow, it needed to think and act the way a large successful, Peerless Competitor would. 

Vendors are an important part of any company.  The difference in a peerless company is they are recognized and treated like an important member of the team.  During earlier industrialized times, companies like Standard Oil, Ford Motor Company and Hershey’s recognized the value of suppliers.  In the case of Standard Oil and Ford, they integrated horizontally, making suppliers part of the overall company.  Standard Oil under John D Rockefeller pumped oil from the ground, refined it and even built the blue wooden barrels used to store their final product.  The Ford River Rouge Complex received raw materials; iron ore, rubber, sand etc. which came into one end, and cars came out the other. 

Milton Hershey built his plant in the heart of dairy country to ensure a ready supply of milk, chocolate’s main ingredient.  These companies recognized the value of having reliable suppliers.  To become a peerless company, a solid business partnership needs to exist between your company and all of its suppliers.  Make them part of your team, involving them in planning and (most importantly) paying them on time.  Building that relationship will truly set your company apart from your competitors. 

Employees will make or break the delivery of your product/service.  It is amazing that companies will spend lots of money on advertising and marketing, getting customers to buy their products, only to have a surly employee turn that buying experience into a one-time event.  A peerless company must spend time marketing internally; see the article “Involve Your Team”, making sure both customers and employees get the same message. 

Many small companies treat employees like family, and while a cordial working relationship is necessary, employees and family are different.  The road to becoming successful and eventually peerless means that you need to have great employees.  People who think and act like they are part of a championship team (take the recent NBA World Champion LA Lakers) do you think of them as a family?  No, they are a team.

They have been selected and trained to work together toward a common goal which is to stand alone at the top - a Peerless Competitor.  If an employee is not working well with the team and jeopardizes the final results, then they need to be replaced.  This is harder to do with family.  Remember the goal is to stand alone at the top, earning exceptional profit which also means that each team member will get their share of the rewards.  

Treating people fairly goes without saying.  In a peerless company, the vision must be communicated clearly. It must go beyond communication by actually demonstrating the seriousness of becoming more than simply successful.  Potential employees need to embrace the vision and buy-in or opt-out.  Those remaining will work to turn the vision into reality, knowing that they will be treated fairly and rewarded for above average performance. Working with the best of the best in a positive environment creates a contagious excitement which gets transferred to your customers.  People like to buy from winners.

Why is it important to become a “Peerless Competitor?”  The top three companies in any market are also the most profitable.  If your company is ranked number four in its market, it earns lower margins than numbers one, two and three.  Success for any company is measured in net profit, which is the results of a simple business formula: buy-low, sell-high and keep the difference.  Therefore, the mark of success in business is a positive net profit and may be achieved for a short time even with a haphazard business structure. 

Success and Peerless are not interchangeable terms. There is a big difference between making a profit and standing alone.  When you think of a peerless company names like Google, Apple, Microsoft, IBM, Ford, Wal-Mart, and Johnson & Johnson come to mind.  These companies have achieved a level of respect that allows them stand alone at the top or their respective markets with exceptional earnings for their owners and stockholders.  Not one of these companies started out at the top.  They executed well and paid attention to the basics.  The importance of becoming a “Peerless Competitor” then is to stand alone in your market and to earn exceptional profits. 

Paying attention to the basics of your business is important, and there is nothing more basic than structure.  With the proper foundation, business success can be achieved. This success can then serve as the basis for moving into the realm of the Peerless Competitor.

Let me know if you have any comments, questions, or suggestions.
Write David W. Weatherholt at david@bnewsviews.com

Copyright © 2010 Weatherholt & Associates, LLC all rights reserved worldwide.
Business/News & Views® is a registered trademark of Weatherholt & Associates, LLC