Business Analysis Toolkit

Technology has made it possible for people to get as much information that used to be proprietary and difficult to obtain. Now, the Internet can provide solutions to just about everything and this has led to the influx of business establishments all over the world—physical and online. For this reason, competition has also risen significantly in many industries and this has given rise to another set of metrics that needs to be measured to ensure that the current business processes are at par with the current trends. These are called competitors KPI in which the strengths and weaknesses of the competitors are analyzed.

Before moving on, one should not make the mistake of misidentifying competitors. Many people think that other businesses beside them are competitors. What really defines a competitor in the business world is that it is any kind of business that offers the same products and services such as yours. This means that if you are operating an entertainment facility, but the food chain near you gets the load of customers, the food chain should not be considered as a competitor since they belong to a different industry from yours.

Competitors will always be there and this is an inevitable fact. People love options and this is the root cause of competition. One way to see if a business is in equal competition is to do an analysis regarding its competitors. This does not mean physically spying on the prospective competitor and sabotaging its products. Healthy competition is done through analysis and looking at what the other companies have to offer that you currently do not have, such as technology service, and cost.

As part of the Key Performance Indicators of competition, one should conduct competitor analysis. The KPI scorecard should show the level of analysis done and to what extent the results will impact the company. It is a sad fact of reality that many business managers do not actually do this. It currently shows that a lot of managers analyze their competitors through hearsay and conjectures. These are all assumptions that cannot be validated with data. If these assumptions turn out to be wrong, then it is needless to say that the business approach will also be wrong, and may even cause more damage.

Next, the KPI scorecard for a competitor should contain a competitor array analysis. This means there should be a structured approach in measuring competition. First off, one should identify the scope of its industry, and from there, decide who the competitors are and who are not. After determining the competitors, the next thing to do is to define the customers. One cannot expect to get all sorts of customers. There has to be a target audience.

Once this is determined, move on to identifying key success indicators for your industry. It is wrong to assume that stocking and advertisement will be beneficial to you. Analyze carefully what made other companies such as yours successful and move on from there. Identify what weighted average each metric should have then measure what you currently score against your competition. Once you get this information, your competitors KPI is done and wise decisions can be made regarding key areas in your company that needs attention, which the competitor is successful at.
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