Winning - Jack Welch [60]
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SLIDE TWO
What the Competition Has Been Up To
What has each competitor done in the past year to change the playing field?
Has anyone introduced game-changing new products, new technologies, or a new distribution channel?
Are there any new entrants, and what have they been up to in the past year?
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This set of questions brings the players on the field to life. Competitor A has been stealing your key salespeople. Competitor B has introduced two new products. Competitors C and D have merged and are having all kinds of integration difficulties.
Some of this information may have surfaced during the wallowing of the first question set, but now it’s time to dig deeper into each competitor’s behavior.
Be granular—know what each competitor eats for breakfast.
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SLIDE THREE
What You’ve Been Up To
What have you done in the past year to change the competitive playing field?
Have you bought a company, introduced a new product, stolen a competitor’s key salesperson, or licensed a new technology from a start-up?
Have you lost any competitive advantages that you once had—a great salesperson, a special product, a proprietary technology?
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The best thing about this slide is that it hits you between the eyes if you’re being outflanked. Very simply, the comparison of slides two and three tells you if you are leading the market or chasing it.
Sometimes these two slides show you that your competitors are doing a whole heck of a lot more than you are. You’d better find out why.
Other times, the comparison of these two slides paints a vivid picture of your business’s competitive dynamics.
Case in point is what happened in our medical business in 1976. The British company EMI had invented the CT scanner in the early ’70s, forcing the traditional X-ray manufacturers—Siemens, Philips, Picker, and us—into an intense equipment war. Soon enough, all of us were coming out with million-dollar machines six months apart, each claiming to be thirty seconds faster in scan time than the last entry. No one was particularly happy with this situation. The CT competitors were in a slugfest, and our customers—the hospitals—were frustrated that they had to make big capital outlays for technology that could be outdated within a year.
Seeing that dynamic, Walt Robb, the head of our medical business, and his team, came up with a breakthrough idea. GE would allocate its resources to design scanners that could be continually upgraded with hardware or software that would cost less than $100,000 a year. We would sell our machines by saying, “Buy a CT scanner from our Continuum Series, and our upgrades will keep you from becoming obsolete for a fraction of the price of new equipment.”
The Continuum concept changed the playing field. It made us No. 1 and has kept us there for twenty-five years.
The main point here is that slides two and three work as a pair. They take anything static out of strategy and get you ready for the questions that come next.
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SLIDE FOUR
What’s Around the Corner?
What scares you most in the year ahead—what one or two things could a competitor do to nail you?
What new products or technologies could your competitors launch that might change the game?
What M & A deals would knock you off your feet?
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This set of questions is, with doubt, the one that most people miss.
They just don’t give it the paranoia it deserves.
Most people answering this set of questions underestimate the power and capabilities of their competitors. Too often, the assumption going in is that competitors will always look the way they do in slide one—they’ll never change.
Take the case of Aircraft Engines in the 1990s, when our engineers believed that they had designed the perfect engine for the Boeing 777—the GE90. We spent more than $1 billion to get more than 90,000 pounds