Competitiveness is a crucial pillar in maintaining and growing a business, whatever stage the company is at. Competitiveness takes many forms – it could be differentiation and hence a unique value proposition for the product, it could be a pricing advantage or unique business model, or a loyal customer base that has been carefully curated to offer the business its advantage.

While one of the above typically provides a good moat around the business for it to succeed initially, we often find that most businesses have to slowly add a competitive advantage in many more areas to become a truly global, prosperous and sustainable business. For example, when a company starts with a unique technical differentiation, this is regularly a great barrier to entry, often due to unique IP. Unfortunately, some start-ups feel that this alone will keep them being best-in-class and the go-to product. However, translating that as a competitive advantage of value proposition to getting the right pricing and business model is what sets a company apart.

Another aspect to competitive advantage is the need for agility. To be able to stay ahead of customer needs and move with market trends is a powerful way to remain attractive to customers and retain loyalty in customers. While scale certainly helps, startups often win the hearts and wallets of customers over larger corporates due to their agility in providing product features that the customer needs in a short timeframe. This could also be in the form of being highly responsive and providing superior support to their customers to continue to deliver on their customer value proposition. This helps with maintaining a loyal customer base and keeping churn rates low which is also a key competitive advantage.

Competitiveness further enables businesses to be on a constant improvement cycle. Periodic reviews of internal organisational infrastructure, resources and processes is critical to see if remaining competitive through building robust employee value proposition. This could also enable more flexible working policies which could in turn enable a more diverse workforce.

There are so many ways a business could be competitive. However, a successful business is the one able to show its competitiveness in all the different aspects.
 

Authored by Dr. Manjari Chandran-Ramesh
Partner, Amadeus Capital Partners,
and member of the BVCA Vision 2023 judging advisory panel

This article was originally published in 2023 as part of the BVCA's Vision Awards, and some of the content may now be out of date. Please contact the BVCA if you have any queries or need further assistance.