Not sure why your ground-breaking product idea failed to drive sales? Or why does a competing firm continue to capture more industry attention than you despite all the blood & sweat your team puts in every day? To answer these questions, you need a market-level view of what’s happening around you.
In other words, you need to invest time & effort to analyze your competitors, their strengths and weaknesses – both, external and internal. This not only eliminates the need for guesswork, but it’s also a great way to save time, conserve resources, and find the right opportunities for you, ensuring the continued success & growth of your business.
A Competitive Profile Matrix helps you differentiate your products or services against your competitors. Whether you are looking for some cues to level up the SEO content of your website, or trying to code a new software that addresses a specific problem facing your customers – the basic goal here is simple; to gather intel that helps you create the kind of action plans that leverage these differences in company profiles to your advantage.
In our template, we base our analytical framework on Critical Business Factors. Your first step is to come up with a list of relevant CSFs in light of the unique challenges, customer demands, and market dynamics of your industry. You then assign a percentage weightage to each CSF before giving a performance score to each company. Once you do this for all CSFs and for each competitor you are analyzing, our template automatically calculates the total of your weighted scores, yielding an aggregate value for you that shows the overall competitiveness of each company.
Now, to answer the most important question of the day:
What’s a Critical Success Factor?
You might have seen these words casually thrown around on strategy maps printed across placemats & posters found in meeting rooms – but what does this term really mean, and how do you identify and manage CSFs for your business?
CSF is a simple, rather self-explanatory concept commonly used in the business and project management worlds. It refers to any issue-area or element of an organization that has the potential to affect its success or performance. In that sense then, CSFs are not only important for goal-setting as they help teams decide what to focus on, they are also used as a metric to measure success or track performance over time.
Which factors you end up choosing will vary from company to company and industry to industry. For example, for tech firms, innovation is probably the most important CSF given the fast pace at which new technologies or new tech products are made; whereas, for a hospital, other factors, such as ensuring compliance with laws and policies on patient safety, are more important or business-critical.
But just to give you an idea of where to start, here are some common examples of CSFS that affect most commercial enterprises, regardless of sector or industry:
- Brand reputation
- Customer service
- Level of Innovation or Adaptability
- Pricing
- Operational Efficiency
- Tech Infrastructure
- Strategic Partnerships
- Marketing or Sales Strategy
Scroll down to the end of this page for more insights on how to choose and track the right CSFs for your business.
How Our Template Works
The best part about this template is the way it offers a quantifiable way of measuring the different levels of competition you are against. By helping you identify, track, and manage CSFs for multiple companies, we put you in a better position to assess your relative place in the market.
If you are scared of all the math, don’t be! Our template comes with built-in mathematical functionalities to make your life easier.
Once you have nailed down a list of competitors you want to analyze, and decided which CSFs to focus on, all you need to do is follow these simple steps:
Step 1
Assign a percentage weight to each CSF in light of how important or critical it is for your business. In particular, you might want to look into how closely each CSF is aligned with your overall strategic objectives or how much each CSF contributes to your company’s financial gains. Bear in mind that the total percentage, that is, the sum of weights assigned to each individual CSF, does not exceed 100%.
Step 2
Rate each company from 1 to 4 for each Critical Success Factor. When trying to pin down how well (or poorly) your competitors measure up against each CSF – always take stock of any relevant data you have access to, such as social media analytics, annual company reports, industry-level stats, and more. A weighted score is then calculated for each factor by multiplying the weight by the rating.
We have also added a configuration sheet to qualify each rating based on each company’s respective performance against each CSF into ‘Major’ and ‘Minor’ strengths & weaknesses. For an accurate and sound analysis of your competitive landscape, make sure these ratings reflect (as closely as possible) the actual competitive standing of each company.
Step 3
Review and compare the weighted scores we auto-calculate for you to get a measurable sense of who you’re up against. Our template lets you quickly identify which companies score the highest against specific CSFs as well as overall based on a total weighted score for each company being profiled & analyzed.
Our template is customizable (so you can use any set of Critical Success Factors that work for you) and scalable (so you can add as many individual competitors & CSFs as you like).
Tips to Consider When Mapping Profiles For Your Industry
Here are some useful tips & insights to consider when creating a Competitive Profile Matrix for your business or project:
Keep it short but relevant
It’s standard business practice to take stock of at least 5, and no more than 10 CSFs during a competitive profile analysis. This ensures you are able to narrow down your focus to only those factors that are truly critical and can significantly affect your strategic priorities as a business or organization.
Put the right people in charge
Putting the right folks in charge of implementing your CSFs is crucial if you want to see results and ensure team accountability. By creating a sense of ownership and a direct line of communication down from senior executives to on-ground team members, you are able to improve coordination across teams & team members while making it easier for those in charge to monitor performance against set targets and metrics.
Use alongside other business analysis frameworks
When developing a long-term strategy, it is common for businesses to run a competitor’s analysis in tandem with other analytical tools such as SWOT, PESTEL or McKinsey’s 7-S. To help you save time and effort, we have developed a complete range of customizable SWOT templates so you can analyze internal & external factors affecting your business, both in a negative or positive way.
Get everyone on board
Choosing the right CSFs is vital as they provide the basic foundation of your analyses. While some companies hire a consultant to help them single out the most critical factors affecting their business, others take a more in-house approach by organizing focus group discussions and employee feedback sessions with key stakeholders and team members to collect data & perspectives for analyses.
Who Is Our Template For?
- Business strategists and analysts: For detailed competitor evaluations.
- Product managers: To refine product development strategies.
- Corporate planners: To align business resources and capabilities with market needs.
- Entrepreneurs: To assess competition for new ventures.
- Marketing teams: To refine messaging and highlight unique selling points.
- Entrepreneurs: To assess market fit for new products.
Wrap Up
Whether you are trying to cash in on your unique proposition value or looking for areas where others outshine you, say, in terms of their digital marketing game, you’ll find our template to be a useful addition to your market analyses toolkit.
With the help of a visual & numerical guide of how your company stacks up against competitors in critical, pre-defined areas, you can make sure that your internal operations align with your broader business strategy so you can better monitor your progress and make more informed, market-responsible decisions. Remember, it’s not enough to simply map out your competitive landscape, you also have to act on it using a focused and strategic approach. For example, if one of your CSFs is customer satisfaction, you might set a goal to improve your Net Promoter Score (NPS) by 10% in the next six months.
Our free and editable template can be downloaded directly as an Excel file or accessed via Google Sheets for cloud-based sharing, editing and collaboration.
