Jul202025
Owner

 

Pick your core business strategy and succeed.

This is a copy of my article published in InHouse magazine, June 2025. InHouse is the official magazine of the New Zealand Certified Builders Association.

 

In the book The Discipline of Market Leaders by Michael Treacy and Fred Wiersema, three core business strategies are outlined that help companies achieve a competitive advantage and become market leaders. These strategies—Operational Excellence, Customer Intimacy, and Product Leadership—are based on different approaches to delivering value to customers. Successful companies pick ONE foundational strategy and then align their other activities in support: marketing, operations, customer management, team development, etc. If you try to deliver on more than one core strategy, you will likely fall short and end up doing everything badly. For building companies, applying these strategies can drive growth, improve profitability, and help establish a strong market presence. Below is an outline of each strategy, and how to implement it into your business.

 

1. Operational Excellence

Business Strategy Overview:
Operational Excellence focuses on delivering products or services at the lowest cost with the highest efficiency. It involves streamlining processes, reducing waste, and improving overall operations. Companies that adopt this strategy emphasize reliability, cost-effectiveness, and simplicity. While not the sexiest strategy it can be very successful, especially in tighter economic times.

How to Implement Operational Excellence in Your Construction Business:

  • Process Optimization: Review all key processes such as quoting, project management, and procurement. Identify areas where you can reduce time and costs, such as through automation or more efficient project scheduling.
  • Lean Construction: Implement lean construction practices like continuous improvement (Kaizen) to reduce waste in labour, materials, and time.
  • Standardized Procedures: Develop standard operating procedures (SOPs) for all tasks within your business, from client communications to construction methods. This ensures quality control and helps with training new employees.
  • Technology Integration: Invest in construction management software to track project progress, streamline communication, and reduce administrative tasks.

2. Customer Intimacy

Business Strategy Overview:
Customer Intimacy focuses on building deep, long-term relationships with customers by understanding their needs, tailoring services to fit those needs, and offering personalized solutions. This strategy is about offering exceptional customer service and ensuring that your company becomes the preferred choice for your target market.

How to Implement Customer Intimacy in Your Construction Business:

  • Client Relationship Management: Use a customer relationship management (CRM) system to track client preferences, project history, and feedback. This data allows you to provide more personalized and timely services.
  • Tailored Services: Offer custom solutions to your clients, whether it’s in project design, scheduling flexibility, or addressing specific concerns unique to each project.
  • Regular Communication: Keep clients informed at every stage of the project, from pre-construction planning to post-construction support. Providing updates and addressing concerns proactively will create trust.
  • Client Satisfaction Surveys: After project completion, survey clients to understand their level of satisfaction and gather feedback on areas for improvement.

3. Product Leadership

Business Strategy Overview:
Product Leadership is about offering the best possible products and services in the industry, with a focus on innovation, quality, and cutting-edge solutions. For construction companies, this strategy means offering the highest standards in design, materials, and craftsmanship.

How to Implement Product Leadership in Your Construction Business:

  • Invest in Innovation: Stay updated with the latest construction trends, such as sustainable building practices, smart homes, and new materials. Invest in training your team on these innovations.
  • Quality Control: Implement rigorous quality control measures to ensure every project meets the highest standards of craftsmanship. This may involve hiring skilled tradespeople, using top-quality materials, and offering warranties on your work.
  • Unique Offerings: Differentiate your services by offering something unique, whether it’s a specific design style, eco-friendly building options, or advanced building technology that competitors don’t offer.
  • Thought Leadership: Share your knowledge with clients through blogs, seminars, and workshops to position your company as an expert in the field. This also helps with marketing and client trust-building.

 

In summary

By adopting one of these three strategies—Operational Excellence, Customer Intimacy, or Product Leadership—you can build a competitive advantage for your company. While large corporations often dominate these strategies, smaller businesses like yours can also benefit by focusing on one of these core areas and aligning your operations accordingly. Choose the strategy that best aligns with your strengths, market opportunities, and the long-term goals for your business. Once you have picked one, use that strategic lens to review and develop all the areas of your business accordingly.

For help in deciding which strategy is best for you and how to implement it into daily activities, email me at andy@tradescoach.co.nz and we can book a strategy development session.