The competitive impetus

Yesterday, I received a call from someone who noticed a long -established competitor is responding to his group's initiatives with changes and improvements to the competitive site.

We agreed that this can be seen in a flattering light; if your ideas are good enough that they are being copied, you are on the right track. Nevertheless, the question is, what should you do when you see the competitor sniffing around in your "space" and, seemingly, stealing your ideas.

One solution, not recommended except for those with very deep pockets, is to bring the lawyers out, as has happened recently with Reed and McGraw-Hill Construction. These mega-corporations can afford a few million dollars each on legal fights without worrying about the dollars and cents of litigation (these fights are lawyers dreams for billable hours!)

I decided to engage a competitor in the legal framework only once, about 14 years ago. The competitor was trying to stomp on me AFTER he broke a buy-out agreement, which resulted in the voiding of the non-competition agreements. I won't forget the day the process server arrived at my office, with a writ claiming $1 million in damages. I called friends to recommend a lawyer, and they all recommended the plaintiffs!

Fortunately, my affairs were structured so the other publisher had to sue the local Board of Trade (Chamber of Commerce) as well as my business, making it rather messy for the plaintiffs, also business-to-business publishers. As well, my lawyer confirmed to me that I had actually acted appropriately throughout.

In the end, at an injunction hearing, the judge issued a split ruling: Clearing my business of any liability (and awarding costs), while finding the Board of Trade and its then president had erred.

The story ended with the Board of Trade paying about half of my legal costs and its then-president resigning after he was picked up in a prostitution sting. I had nothing at all to do with that, but it certainly added up to an amazing business year.

So, while lawyers and legal actions can create competitive chaos, are there other, more effective, responses? Here are some other ways to handle competitive challenges:

• Be true to yourself, but don't be afraid to copy good ideas (that aren't patented or protected by trade secrets you've cracked, of course) and implement them in your own business.

• Remember you have a primary niche and market. You are generally wisest to focus on your market and maintain a leadership role. The challenge comes when an extremely well-funded competitor tries to invade your space. You can't generally invade their space in response, so your best approach is simply to be much better than they are at what you do.

• Connect and relate to your current clients better than ever, keep your marketing and product focus high, and constantly improve.

Healthy competition will improve your business and sustainability. In my years in business I've seen "brilliant" competitors come and go, and usually the failure occurs when their ego gets ahead of their business.

(Oops. Is this speaking about me? Yes, last year I felt smug as I watched a competitor crash and burn but beneath the surface I was making many of the same mistakes -- fortunately we caught them in time, but it has been a scary ride.)