As I said before, the other most common mistake that deprives SWOT analyses of their value is the failure to take the essential next step, after it has been completed. “What is that next step?” you may ask. The answer lies in the fundamental intent behind the SWOT analysis. The purpose of a SWOT is to help analyze and assess the competition. And what is analysis, other than simply deriving meaning from data? There is a big difference between observation and analysis. Simply put, observation provides the “what,” while analysis provides the “so what.” Herein lies the reason why many deride and dismiss the SWOT chart as useless. In its standard form, it is data with no analysis. It includes nothing more than four lists of characteristics or factors about the company, none of which articulate any kind of strategy or action on the part of the company. Therefore in the eyes of the savvy decision-maker, it fails to answer the critical “so what?” question. You can imagine your executives saying “So… the company is strong in these areas, and weak in these areas … so what? And… the company is affected by these external opportunities and threats… so what??” It is my assertion, therefore, that the true value of any SWOT analysis appears only after completely (and correctly) populating all four quadrants, and THEN developing key strategic implications based on those factors. Competitive analysis of any company must include a predictive element, which attempts to answer the question “What is the company most likely to do next?” The four elements of a SWOT chart, if accurate, can be extremely useful in developing these predictions – but they do not explicitly provide the answers in and of themselves. So how does one take this next step? There are several different ways of deriving implications from a traditional SWOT chart – one of the more effective (albeit labor intensive) methodologies I have come across involves examining the intersections of the various factors two by two, in an attempt to discern the most likely action on the part of the company. For example: if the company has [Strength #1] and [Opportunity #1], therefore they would most likely do [Implication #1]; if the company has [Weakness #1] and [Opportunity #1], therefore they would most likely do [Implication #2], etc. There are two downsides to adopting this “extra step.” First, it adds a layer of complexity to a process that is otherwise very simple and user-friendly (which I would argue is one of the reasons SWOT is so popular). Second, prediction is a dangerous game. Those who attempt to predict the future invariably expose themselves to personal risk – risk to their reputations. Success will earn them great respect and even reverence – but failure may cost them the trust of their customers. But analysis is not for the faint of heart! In my judgment, the benefits far outweigh the costs. So be bold. Be fearless. Be ruthless in your zeal to add real value in the form of that elusive treasure – the life-blood of our profession: actionable intelligence.
Price to Win is both a process and a result. Price to Win as more than a number, but could be best defined as the cost-capability tradeoff that embodies your company’s strategy. Price to Win, the process, identifies the position your company needs to achieve to meet your company’s business goals and objectives. It does not necessarily mean winning. You may want to position with your customers, but not actually win a program. You may need to bid on a program that you don’t actually want to win because it doesn’t fit your corporate objectives. The Price to Win process is designed to respond to the government’s needs, and applies several factors (such as gaming strategy, aggressiveness, fee and corporate interest) to best identify Price to Win, the position. The Price to Win position is the actual cost-capability tradeoff that your team will present to the government in your proposal response. It is a carefully deliberated position that includes “cost + strategy” to represent your overall business strategy. Remember, your company’s corporate strategy is the biggest driver in making business decisions, and the biggest factor in determining price to win, the position. Not cost plus fee. For more on Richter & Company’s Price to Win services, contact us today.
Whether you love them or hate them, SWOT Analyses have been around for many decades, and they continue to pervade the realm of business development and strategic decision-making, most commonly in competitive assessment. I could talk at length about why these simple quad charts have garnered so much attention (both positive and negative) over the years, but I won’t. I continue to see value in SWOT analyses, but only if they are done properly and completely. What I want to talk about is what almost everyone does WRONG with SWOT analyses. In my experience, the two most common mistakes that rob a SWOT analysis of real value are: (1) failure to understand what an “opportunity” is, and (2) failure to take the essential next step after a SWOT analysis has been completed.
- Opportunities misunderstood.
Price to Win is always an ongoing process, which undergoes many iterations before an actual proposal is ever delivered. Richter & Company’s training courses are designed to give you the tools and templates you need to maximize the benefit of your competitive intelligence and price to win efforts. Actionable intelligence is derived from following the process, while trusting the skills of your analysts to deliver quality results to your capture team. But it’s more than simply checking a list: the process is designed to lay the foundation of your winning proposal. Plan work based on requirements. Designate resources. Can you deliver on the work proposed? Although it sounds obvious, make sure you’re bidding on work you can and should win. Baseline the opportunity and customer. Spend some time getting to know your customer, and what they’re actually looking to buy. Get to know the contracting shop as well as the end user, and understand that you’re going to need to address all customers in proposing your solution. Identify and analyze the overall competitive field. Identify who else is going to bid, and their relationship with the customer. What does their solution look like? The competitive field will change as time goes on: who has left the competition, and why? Who has joined the competition, and why? Identify any teammates and suppliers, and determine how their addition to the team will affect solutions, and pricing. Develop and test RFP-based models. Forget the gold plating, and the standard set by the competition. Build a bottoms-up model, based strictly around RFP requirements. How will your solution add value? Rank your solution based on the requirements set forth in Sections L & M. Prepare analysis of key competitors. Once the RFP is imminent, look again at your key competitors. Identify strengths and weaknesses of their solution. Mitigate their strengths by offering value to the customer. Speak to the things they care about, and emphasize your own strong, low-risk solution. Ghost weaknesses by highlighting your own strengths. Be aware of how competitors will leverage their solutions and ghost your company. Evaluate and rank key competitors. Build out solutions for your competitors. What is their offering likely to include? How will it be received by the customer? Be sure to do due diligence in looking at past successes; what stories will they tell? How will they game their solutions? Identify and analyze pWin enhancers. Once your analysis is complete, it’s time to finalize your story. Identify any final solution gaps, and address them: team as necessary. Close in on any gaming opportunities. And decide on your key messages and discriminators that really differentiate your solution from your competitors. For more information regarding Competitive Analysis and Price to Win, contact Richter & Company. Since 2006, our proven processes have helped clients win over $30B in new business.
Over the course of the past several years, “best value” has reigned supreme in the federal contracting world. But with the economic downturn, we’ve seen an increase in Lowest Price-Technically Acceptable (LPTA) contracts. Despite the general aversion for LPTA awards, they’re here to stay. Last summer, Washington Technology did a survey among contractors regarding LPTA contracts. 68% of the survey’s respondents said the LPTA has negatively or mostly negatively impacted their businesses; pointing to suffering profits, lowered salaries, and an influx of junior staffers as results of increasing LPTA awards. And 66% of respondents said the LPTA has negatively or mostly negatively impacted the customer. Comments included the government’s surprise in receiving junior staff when experience was needed, and an inability to win task orders under BPAs due to lack of experienced personnel at proposed prices. Work has been done on both sides of contracting business to assure that the government’s needs are met, while educating government customers about the risk of an LPTA award. But with ongoing political power plays and uncertain budgets, the LPTA award isn’t going away any time soon. Nearly half of contractors surveyed think the number of LPTA awards will increase in the next few years. At Richter & Company, we agree. With many agencies having troubles in their contracting shop, and plenty of commoditized items on the purchasing docket, the LPTA is a convenient way to purchase. Unfortunately, the convenience outweighs the risk. The LPTA award isn’t going away any time soon.
At Richter & Company, we make the call. Primary research– actually talking to people within industry– provides quantitative data we need to make sound analysis. On most projects, there are 150 to 300 contacts that we reach out to. In our consulting role, we have flexibility in reaching out to companies as a third party. Because we’re not vested in an opportunity, we have the ability to ask about the opportunity, problems with the procurement, the competition, and likely solutions. Primary research faces the largest risk of disinformation- any business development manager can offer unreliable information, but it also offers some of the most valuable data points. Statistical “outliers” can be set aside for further review or examination, but the aggregate of information presented in calls paints a pretty accurate picture of the competitive landscape of a program. Sound and accurate analysis is built on both qualitative and quantitative data. The more thorough the research efforts, the more we can provide you with actionable intelligence for your capture efforts. For more information regarding Richter & Company’s services, contact us.
Competitive analysis can be a daunting task. At Richter & Company, we believe strong, reliable processes build the foundation and framework for sound, defensible analysis. Competitive analysis can be broken down into three parts: Business Intelligence forms the foundation of competitive intelligence. It focuses on quantitative numbers, like financial metrics and number of units produced. Business intelligence consists of solid, irrefutable data points that define a company. Competitor Intelligence lays out the framework for analysis. It is made up of quantitative data (business intelligence) and qualitative data. While quantitative data defines, qualitative data describes. Capabilities (general and specific), relevant news and identified past performance help characterize a company as qualitative data points. We can define ‘competitor intelligence’ as information specific to a single competitor. Competitive Intelligence enhances competitor intelligence through inclusion of environmental factors (political, economic, social, etc.). Experienced analysts help determine how these external factors will affect the competitor intelligence gathered. Companies can then be assessed against one another in some kind of objective evaluation, mimicking the source selection board decision-making process. Richter & Company has been using this framework for competitive analysis to help clients win more than $30B in new business since 2006. To find out we can help you win, contact us today.
Many companies include the SWOT chart as part of a competitive intelligence presentation. They spend a lot of time preparing the strengths and weaknesses, opportunities and threats, and creating a beautiful image. And… that’s it. SWOT charts were designed to be springboards for creating strategies. What products or services will the company leverage? How will they differentiate their offering? What story will they tell? What are their weaknesses? Are they aware of them? How will they mitigate those weaknesses? How are they perceived by the outside market? What kinds of opportunities and threats exist outside of the company’s control? Strengths identified in other companies should give you incentive to bolster your own solutions. If your solution is not as capable, or desirable, should you be bidding? Opportunities allow you to assess how your own company will be viewed, and where you can maximize play in a potential marketplace. Weaknesses and threats can be turned into ghosting opportunities. How can you capitalize on potential (or perceived) risk? How can you differentiate your own offering to highlight an area of weakness in another solution? SWOTs can be extremely valuable tools, if they’re used correctly. Contact Richter & Company today to find out more about positioning and strategies that help you win.
In the journey of competitive intelligence, it’s essential to have some kind of knowledgebase to store information. This knowledgebase allows you to capture data, analyze historical trends and preposition information as you move into the future. Here are a few characteristics of a strong knowledgebase: A strong knowledgebase is shared by your team. Too often, there are no shared data points between coworkers. One has a Rolodex of his references; another has an Excel file saved on her desktop. The best knowledgebase is one that’s shared among coworkers so it’s robust and constantly updated. In order for that to happen… A strong knowledgebase is accessible. If your team can’t locate the knowledgebase or doesn’t know how to use it, the tool becomes worthless. Train your team. Let them know what goes into the knowledgebase, and what is expected from them for each program. All of your people need to know how to enter information, and how to pull information out. Make it easy for all of them to log in and enter information. But most importantly, A strong knowledgebase is used. Whether it’s a CRM tool, a sharepoint site or a specialized Excel tool, a strong knowledgebase is one that is used regularly. Summaries and trends can be analyzed when there are many, many data points being entered into the knowledgebase. Be sure to use your knowledgebase regularly to maximize its potential. Richter & Company’s knowledgebase includes some 80,000 contacts, and allows us to preposition data for every program. Contact us today to find out how you can win more business.
Often times when companies present their solutions before the government, they talk a lot about themselves. When you’re thinking about themes, working a brainstorm session with your team, or actually writing your proposal, be sure that you’re focused on your customer. Features are attributes of your solution. Be it products or services, features are those things that can differentiate you from the competition: lower cost, smaller size, more power, larger supply base, extended life. Even great features can be meaningless in a proposal, however, if you don’t highlight the value they bring to your customer. Benefits highlight value. Your solution is lower cost. If your customer is looking to spend big money, your feature is meaningless. But in a difficult economy, where maximum value means getting more bang for your buck, low cost is a huge benefit. Base your features around your customer’s needs and wants, and they become benefits. Once you can prove the benefit of your solution, you’re well on your way to winning!