David vs. Goliath analogies are very popular in the world of business. They’re usually invoked to suggest hopeless odds: small start-ups fruitlessly chipping away at the power of industry-dominating forces.
Popular as they are, these analogies are misguided for one simple reason: David won. With the right offering, the right tactics, and the right people, small businesses can take on major players. At Xero, we’ve done exactly that – launching in the UK, then the US, and then South Africa in the face of stiff competition.
It’s not quite as simple as propelling a rock at your nearest rival, but if you’re starting a new business, you can stake your claim on the market.
Here are three ways that David can take on Goliath, and win.
To keep up with the market you have to be willing to change your pace. Competitors will constantly be working on new ways to appeal to customers – be innovative, creative, and if there’s a way to bolster your services, lower your prices, or address your end-user’s pain points, think of it before your rivals do.
Goliaths become vulnerable when their dominance turns to complacency: The assumption that a big business’ rule will go unchallenged led to the downfall of Blockbuster, Nokia and countless other businesses that failed to adapt to an era of constant innovation. Davids can never, ever afford to sit still.
As a start-up, you can move quicker than the major players in your market: they have thicker layers of bureaucracy and more internal stakeholders to please than you do. Learn, grow, and adapt to changing conditions – and make sure that, when you get big, you stay agile.
2Take advantage of technology
Successful entrepreneurship is as much a matter of time management as anything else. You and your team can’t focus on growth if you have to focus on processes like accounting, data entry, and HR.
CEOs often have to be all things to all people in the business: They’re often responsible for cutting costs, chasing invoices, taxes, and making sure salaries are paid.
Technology can help resolve this issue: Cloud software can automate some of the more frustrating, day-to-day tasks of running a business. Accounting software, for example, can make it easy to pay and chase invoices with the click of a button. Data entry can be more or less fully automated.
Every process that you automate gives you more time to focus on developing the business – and the sooner you get on board with technology, the better.
Start-ups that are born in the cloud have an easier time of it than legacy players, who often struggle with the transition.
3Focus on customer service
Finally, make sure to keep a strict and unrelenting focus on customer service. An amazing product is nothing unless it’s supported by an amazing team. If your team isn’t resolving enquiries in a timely, friendly and mutually satisfying fashion; if you’re persistently running out of stock; if your customers don’t feel valued, then it doesn’t matter how innovative you are – they won’t come back.
You might get some short-term sales out of it, but eventually, other versions of your product will become available – and they’ll be underpinned by brilliant customer service models. Stay ahead of the game when you’re interacting with your end-users and you’ll be rewarded for it.
In fact, this principle can be applied to other aspects of the David vs. Goliath dynamic. Make no mistake: David faces tougher odds and a harder fight. But if you can outpace, outthink, and out manoeuvre your bigger opponents you stand every chance of surviving – and winning.