Sources of Competitive Advantage

For every company that manufactures highly engineered products, finding sources of competitive advantage is a never ending task. Products that have a competitive advantage help support high margins, in part by reducing the need to discount, and help drive revenue and earnings growth.

So where does competitive advantage come from? In most firms, the emphasis is on the product and its attributes. We spend extraordinary time and effort on the features and benefits compared to competitive offerings. We obsess on graphical interfaces and software functionality. We engineer the products for high quality.

Often overlooked, however, are other sources of competitive advantage. For instance, how the product will be serviced and supported, and how that can provide competitive advantage.

There are two aspects of this issue. One is related to the design. There are likely design choices that will allow the field service organization to more quickly assess problems and repair the device. For some products, it may mean designing the product to be serviced by the customer. In either case, the customer is more satisfied as downtime is reduced.

A second aspect is related to the field service and support organization structure and the company’s culture. Does the culture reward and value good customer support as a way to gain competitive advantage?  While not strictly an area addressed by the NPD process, it is none the less an aspect of competitive advantage and one way to become a differentiated supplier, helping support revenue and earnings growth.

New Product Visions is a consulting company that helps organizations improve the effectiveness of their new product development processes. We specialize in small to mid-sized companies that manufacture highly engineered products. Contact us today about how we might help you!

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