One ofgreatest Union generals in the U.S. Civil war, William Tecumseh Sherman,described the goal of effective military strategy as maneuvering so that theopposing general finds himself “on the horns of dilemma.”
That meansyou should force your competitor to choose to defend target A by sacrificingtarget B or vice-versa.
GeneralSherman applied this strategy repeatedly throughout the Carolinas and Georgiabetween 1864 and 1865. He would separate his troops into two or more distantcolumns. Each would threaten a different target. This prevented his opponentsfrom concentrating their forces against him. By forcing his opponents to breakup and defend multiple apparent targets, his opponents found they lacked themass to defend any.
While Ajit Prabhu, the co-founder and chief executive officer of QuEST Global, and his team may not liken their strategy to this pattern, they havebrilliantly implemented this ancient principle in what they call the“global-local model.”
As Ajitdescribes, “The company came to be this local-global model. It comes from therealization that people don’t become smarter just by getting on a plane.”
By travelingto the United States, as Ajit did, an Indian engineer can earn many times whathe would earn by doing the same work in his home country. Why does he earnmore? Because he is local and this gives him certain advantages.
For example,it allows him to have face-to-face contact with his clients, which lowers therisk of miscommunication. It also allows him to collaborate more efficientlywith the clients’ engineers, and this close proximity helps him understand thecultural context for the work.
Whileclients should pay for this additional value, Ajit didn’t think they should paymore for the engineer’s brains. So QuEST’s model is designed to optimize theworkload by providing the collaborative client-facing work locally, and thenproducing the problem-solving abroad. This approach seems simple, but it cutsagainst the norms QuEST’s competitors have settled on.
Most of itspeers either conceive themselves as local, high-value engineering firms or aslow-cost outsourcing firms. While their web sites may tout otherwise, adissection of their organizational and incentive structure clearly places themas either local or global, but not both.
QuEST, bycontrast, conceived itself from the beginning as being not an Indian firm, nora U.S. firm, but both.
“Youhave to find a global optimum. That’s not in one location,” says Ajit.
Moreimportantly, QuEST’s management has designed its entire business around thisunique conception. As a result, they have strung together a sequence ofinterlocking decisions in such a way that competitors cannot easily copy justone of them. Consider just a few of QuEST’s strategic decisions:
- ·They organize as one global team: the head of sales does notalways sit in the U.S.; the head of engineering does not always sit in India.
- ·They implemented a company-wide feedback and incentivesystem that tracks each person on indicators of whetherhe/sheissuccessfully being global and local.
- They have evolved procedures, a methodology, and a way of working that helps them efficiently collaborate across borders, doing the local work locally and “global” work in India.
- They have a mission and vision that guides them away from conceiving themselves as Indian or American, which keeps them true to their global mission.
Sure,competitors can copy any one of these. But to do it well, they need to copy allof these and that takes time, money and planning. Ajit and QuEST have created amulti-front attack and competitors cannot compete on the same level withoutlosing the ground they already have.
As Ajitsays, “Our strategy is something that is easy for others to understand,but hard for someone to duplicate.”
Ask yourself thequestions below to see how you can beat your competition by provide someservices at reduced costs without hurting client relationships.
1.Isthere a service or product that can be completed or purchased for less money?
2.Arethere distributors that I haven’t considered?
3.Can Icut deeper into the supply chain to get better prices?
4. Can a select few “face” people handle the client relationships while the “hidden” majority completes the work?