Competitive Advantage

Peter Schooff posted this question today…

How big of a role does BPM play in competitive advantage?

My thoughts…

Let’s look at an example where BPM played a role in creating a competitive advantage – Amazon.

They believed that they could build a better bookstore if they were not limited by brick and mortar.  They were customer focused from the beginning.

As a customer, it is easier to search a database than book shelves.  A book store is a comfortable place to visit, so they needed to excel at the rest of the experience.  As an early customer, I search for a book and then place my order.  I had to enter my contact and billing information and the book would be on its way.

Over time, they looked for ways to make this experience quick and painless.  All of these improvements were driven by the customer buying process.

  • They      added the ability to store my credit card information
  • They      allowed me to store the addresses that I might ship to
  • They      created Amazon prime so that I pay a flat annual rate for free 2 day      shipping [most people want their purchases as soon as possible]
  • They      created the ability to make a purchase with ‘one click’

They asked themselves – we have purchasers on our site, how might we get them to spend more money.

As a result, they began building business relationships with companies that sold items other than books.  Initially, the order would go directly to the other companies who would ship the items.  However, Amazon knows how to warehouse and ship products.  They are also quite good on the financial side, so they now they can bring in merchandise and handle the entire transaction.

As an Amazon customer, they make it so easy for me to buy merchandise that I always look there first.  The purchase is easy and I get to use my Prime 2 day shipping.

They are a great example of a company understanding the customer buying process and they are constantly working to make it better – it has played a big role in their competitive advantage.

Your thoughts…

Does your company understand its customer’s buying process?

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