Many airlines struggle for profitability because fares are so transparent and customers can so easily switch. Only the limited number of services that less busy travel routes can support limit this otherwise frictionless movement of customers’ choice. The customer rivalry frameworks from briefings 50-53 are therefore directly applicable to airlines. In the full-service sector, some genuine loyalty to specific airlines is common, driven by frequent-flyer programs as well as by customers’ experience of reliability and service with specific firms. Loyalty ...Continue Reading → Share
Few companies are so lucky as to have only one competitor, so we need to extend the principles in recent Briefings to handle multiple rivals. It is relatively easy to adapt the three standard rivalry structures to capture several competitors – figure 1 shows the structure for three coffee stores—ours plus two competitors—seeking to win potential customers in the market from Briefing 50.
Figure 1: Dealing with multiple competitors. (Click image to view larger)
Competition is widespread in public services and voluntary organizations, and is often similar to the rivalry for customers in business cases. Voluntary organizations must be clearly helpful to the beneficiaries of their services if they are to attract funding from donors, so any such organization with few such “customers” will lose out in the fundraising market. Other customer-like rivalry arises for political parties who compete for voters, and Churches who compete for followers.
Rivalry for staff occurs constantly amongst public ...Continue Reading → Share
Competition for staff is widespread, not only in corporate settings but in non-profit and public sectors too. Rivalry for highly skilled and experienced people can be so ferocious that it is sometimes known as the ‘war for talent’. Less-skilled staff can be scarce too, so rivalry for employees concerns most organizations at some time. Type-1 rivalry to hire new staff and type-2, to persuade staff to switch from competitors, dominate this issue, since it is rare for staff to work ...Continue Reading → Share
In industries where customers buy substantial projects, each contract is effectively a case of type-1 rivalry – either we win it, or a competitor does. Examples include construction projects in civil engineering or process industries, IT projects for government departments, and large consultancy studies. Customers usually ask possible suppliers to submit bids for a project, issuing “invitations to tender” (ITTs) or “requests for proposal” (RFPs). Although suppliers would prefer a continuing relationship, to enjoy a steady stream of all of ...Continue Reading → Share