This post is the fourth in a series of excerpts from OneCoach CEO John Assaraf’s interview with Rita Gunther McGrath, co-author of The Entrepreneurial Mindset, and MarketBusters: 40 Strategic Moves that Drive Exceptional Business Growth.
As a business owner, you should have some type of business model in place. This model is usually determined by your specific unit of business (your product or service). Sometimes, you can make a huge difference in your industry by changing your unit of business.
Take for example the cement company Cemix. They came to the conclusion that just providing ready-mix concrete wasn’t good enough. They decided that people cared more about the timely delivery of the concrete mix. So they built a business model around the delivery instead of the actual product. This is also an example of changing the operating rules of your industry by altering the buyer/supplier relationship.
A story that illustrates this mode of thinking is the Blue Mountain Arts company. They took a popular print business and expanded into a free online greeting-card business. The owner then looked to change his business model through monetizing it by pairing it with the flower industry.
Here’s where he held on to his chips for a minute to think about his strategy. He knew the flower industry would be quite a challenge to break into, and knew it would be too difficult to differentiate his business. So he changed the whole model by cutting out the call center, the intermediary distribution, reducing time and costs.
Though it may be honorable to work hard and fight against your competition, there doesn’t always need to be competition. You don’t have to change your entire business, but you should always look to see if you can be doing business differently… better.