Your surroundings can change in the blink of an eye. It can be unexpected, overwhelming and leave you with little or no time to react. A symbolic example would be the eruption of Mount Vesuvius near the city of Pompeii, Italy, in the first century AD. While there was ample time to flee, those living in the area did not recognize the warning signs provided by the mountain. Had they paid closer attention, they could have avoided tragedy and devastation.
Your business is not immune to change. Pompeii reminds us how unexpectedly your environment can be altered and how quickly you can be blindsided by seemingly inescapable dangers. One of the biggest dangers for organizations everywhere is the danger of misjudging trends that can render their business obsolete. Similar to how the residents of Pompeii could have been more aware of their surroundings, businesses need to know what is happening all around them – in the market, with their competitors, with their customers and non-customers.
Are you relevant?
Many companies focus more on being the best rather than being the most relevant. It’s a dangerous obsession that prevents many from recognizing new opportunities. Nothing is more important than being relevant to your consumers and evolving your offerings to provide them with continuous meaning.
Often companies lose sight of their own relevance because they are too focused on competitors. Meanwhile, they put themselves in danger of losing out on substantial new market opportunities and becoming inconsequential to consumers.
Are you unconventional?
Conventional thinking has its merit, but it is crucial to systematically challenge the conventional boundaries of your business and industry and actively drive its lifestyle-enriching relevance.
One thing companies need to be better at is challenging employees to overstep perceived boundaries so they can uncover new possibilities and achieve alignment around the best strategy to move forward. It all starts with two important questions.
Kodak, an iconic American company, completely missed the significance of the world’s transition from film to digital photography. It misjudged the speed and impact this movement would have and in turn lost its relevance to the market. The company suddenly had to churn gears to find new areas of profitable growth that would make up for the loss of its core business. Not surprisingly, Kodak declared bankruptcy in January of this year. The moral of the story is that without continuous innovation and a vision to be market driving, your business can quickly become irrelevant.
- How do you define your business, and how should you define it to unlock greater lifestyle or workstyle enrichment for consumers?
- Who are your most relevant, not just your most direct, competitors?
As simple as these questions may seem, they are quite challenging for executives to answer and are best served by using an Accordion Chart – a visual tool that enables the flexible exploration of market spaces that an organization’s offering occupies.
Behold the Accordion Chart
An Accordion Chart illuminates the full spectrum of an offering’s positioning from its core utility to its most general application. Just like the musical instrument, it’s collapsible and can be used to flexibly look across, combine and integrate various gradations of market detail.
- One-page chart showing the current strategic landscape of a company’s offering
- Allows for visual exploration and understanding of strategic possibilities across market layers
- The chart contains five to seven vertical columns. Start by filling out right-most column by answering following questions.
- Market definition – How would you define most narrowly the core utility of your offering to consumers? What do you provide for them at the most basic level? What specific need or desire do you fulfill? Competitors – What competitors also provide the same core utility? Who are your direct competitors in this narrow market segment?
- Market size and share – What is the total size of this market segment expressed in annual sales volume? What is your market share and your competitors’ market share?
- Growth potential – What is the market segment’s growth potential?
Sample Accordion Chart
Think about a fictitious pizza chain called Shazam, looking to expand its business. This is how it would work.
Core definition: “Locally branded quick-service pizza” (market segment title at far right of chart)
Key competitors: Pop, Sparkle, Zing and others
One-broader market segment definition: “Branded quick-service pizza”
Even broader market segment definition: “Branded fast food”
Yet even broader market segment definition: “Informal eating out”
Broadest utility: “Entertainment destination”
The bus system of Colombia’s capital Bogota was a picture of chaos with old dilapidated buses and uncoordinated bus operators. Former mayor Enrique Penalosa, abandoned conventional thinking and created fixed bus routes and exclusive bus lanes. His overhaul of the transit system was bold, modern and unconventional. It transformed the whole passenger experience and swiftly changed people’s perceptions of Bogota’s bus system, and the entire public mobility of the city.
Key takeaways of the Accordion Chart:
Your relative size in the marketplace becomes smaller as you systematically continue left. You are moving further out of your comfort zone, which means aggregated market share, total market segment size and growth rate figures become more difficult to define. The Accordion Chart will help highlight market spaces you did not deem relevant to your business but which actually have a significant bearing on your broader strategic frontiers. It’s an eye-opening exercise that will help expand your vision.
When you complete the chart you will be able to zoom in and out of your utility’s definition, allowing you to see all of the market layers as well as your competitive landscape. You want to keep your eyes peeled for new insights on broader consumer relevance, lifestyle enrichment and market opportunities.
You will then be poised to answer some key questions:
- How should you define the most basic utility of your offering?
- By moving up one level at a time, what is the most general utility of your offering?
- Which segmentation level has the most growth potential and what are the implications for your business?
- Who are your most relevant competitors?
- What key variations can you think of for defining your offering’s utility and what new insights does each definition generate?
- What seemingly unrelated dimensions should you incorporate into your offering?
- How can you move from right to left on the chart?
In terms of strategy and direction, you need to keep your fingers on the pulse of your offerings without pause. Accordion Charts can serve as your platform for the application of unconventional thinking and your guide for continuously broadening your business’s relevance.
Gabor George Burt is an internationally recognized expert on innovation, creativity and strategy development. His spheres of expertise help organizations to overstep perceived limitations and to carve out successful growth strategies. Gabor’s book, Slingshot, presents a framework for connecting systematic creativity with smart strategy. See www.slingshotliving.com