Negotiation Philosophy

Why Let Your Competitors Control Your Future?

February 15, 2012

Why is it that some group leaders believe that simply having data on what their competitors might offer in terms of exclusive contract stipends, depth of coverage, and the like weighs heavily on their group’s own future?

This is incredibly limiting thinking.

Consider the example of car manufacturers. Certainly, there are commodity manufacturers, such as Chrysler. Those manufacturers are indeed concerned with their competitors’ pricing and features. Taken together, those manufacturers spend billions trying to convince you that a Dodge Ram is better than Chevy Silverado, and vice versa.

But then there are manufacturers like Lamborghini and Ferrari. They are competitors in an entirely different sense. Each produces cars aimed at a different segment of a very particular market. But even then, Lamborghini makes cars and chases buyers, while Ferrari won’t even make a car to ship to a dealer unless that dealer already has it sold.

On even a basic level, knowing exactly what your competitors have accepted as stipend support at other facilities doesn’t provide any truly useful information in respect of what the stipend should be at your facility. Averages are even more useless.

On a deeper level, believing that what your competitors might offer somehow controls your decision as to what you’re going to offer allows your competitors to tell you how to run your business.  Why not make it simple and just call them up and ask them what kind of response to the RFP you should submit?

The key is to turn the tables on the creeping commoditization of your specialty before you get to the RFP. Sell Ferraris, not Chevys. And if the hospital only wants to buy Chevys then you’re practicing at the wrong location. But that’s another story.

Comment or contact me if you’d like to discuss this post.

Mark F. Weiss

www.weisspc.com

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