First Rule of Business: Know Your Competition
Remember Tempur-Pedic? Sure ya do! Tempur-Pedic is known for making memory foam mattresses. They have an iconic commercial of a woman jumping on a mattress with a glass of wine balanced on another end to demonstrate how well their product performs.
Well last week, Tempur-Pedic stock lost almost 50% of its value after the company changed its financial forecast for the rest of the year. What struck me in reading the news was a quote by the CEO Mark Sarvary:
“We did not expect the competitive environment to change this fast.”
Really?! Seriously?! Tempur-Pedic didn’t think they might start to get some competition? Sorry, I don’t get it.
The first rule of business is to know and understand your competition. Think of it as understanding the marketplace for your product or service. Now, I’ve worked for people who thought everyone was their competition (it’s not). And it’s also important to remember that your competition could end up one day being a strong ally. A little healthy competition can be valuable to your business.
But the lesson here is businesses should not take their eye off the ball. Successful companies are constantly monitoring the marketplace – seeing what’s happening and who’s making stuff happen. When the marketplace is changing, companies have to change with it…and quickly.
Will Tempur-Pedic recover from this? Probably. They’re already taking action to repair the damage. But, I was reminded of the “competitive environment changing too fast” story a few times last week with another industry – one a little closer to my profession.
On two separate occasions, a couple of different colleagues remarked that “job boards are dead”. It made me wonder…are job boards really another instance of companies taking their eye off the ball? Hmm, I don’t think so. I believe job boards are evolving with the environment. And it will be interesting to watch how they change.
I’d love to hear your thoughts. Do you see companies losing focus?
Image courtesy of Deirdre Honner
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