TURNING OUR BACK ON OUR COMPETITORS

Frédéric Borne

ih alonso martínezih nuevos ministeriosih diego de león

ih ciudad universitariaih las rozasih sagasta

seven basic principles upon whichto base the IH differentiation

Who said this?

“The worst error in strategy is to compete with rivals in the same dimensions.

Don’t compete to be the best. Compete to be unique.”

1. Napoléon Bonaparte?2. Nicolo Machiavelli?3. John Haycraft?4. Sun Tze? 5. Baruch Spinoza?6. Alan Pentecost?7. Lee Iacoca?8. … ?

OUR LOCAL MARKET CONDITIONS:• Two decades of fast growth have suddenly given place to deep

recession• Government spending is frozen• Tax presure is paralizing the economic agents• Bank credit is non-existent• Bankruptcies fill the headlines• Unemployment is spreading like a medieval plague• Student and family salaries are falling• Dispendable income is shrinking• Consumption is almost completely halted• Companies are focusing on redundancies, not on internal training• The only thing that seems to work, in the public’s view is “bilingual

education” (state, semi-public and private: 500 schools and growing)• There are still 700 directly competing English academies in Madrid• Plus unemployed English teachers who compete offering one to one

classes at 12 € (compared to 50 € at ih) on sitckers found on the street

WHAT MOST COMPETITORS ARE DOING, guided by intuitive logic:

• Dropping their prices• Launching fabulous offers• Saying YES to whatever their clients ask them• Squeezing their costs• Reducing their advertising investments• Working on alternative, cheap products to satisfy

their “poorer” customers• …

Meanwhile, WHAT ARE WE DOING?Turning our back on them and reinforcing our specificity.

Basing our differentiation on seven basic principles…

… and working to ensure that they are:- correctly understood, shared and integrated by every

employee- effectively imbedded in all our external communication

- adequately perceived by each client.

FIRST PRINCIPLE:

Remain faithful to our BRICKS AND MORTAR language school identity.

As much importance given to the “school” as to the teacher and the classroom

New art exhibition spaces in the schools Open-door events to attract new visitors All staff wearing ID cards with name and photo Etc.

SECOND PRINCIPLE:

Glorify the teacher’s presence with the students in a centrally located, easy to reach, IMPRESSIVE, MODERN and COMFORTABLE school.

“The Language Learning Experience” as opposed to “Quality Language Teaching”

All schools named after their metro station ih logos on the official metro map

Etc.

THIRD PRINCIPLE:

Be sure to attract, train and keep up to the task the most ADAPTABLE and CAPABLE professional teachers available on the market.

Unprecedented improvement in economic packages, in times of unprecedented crisis

More precise and ambitious definition of recruitment criteria

Clearer opportunities for internal professional development

Publication of the bios of some of our teachers, trainers, examiners and textbook writers

FOURTH PRINCIPLE:

Emphasize and publicize the social element in our “Language Learning Experience”, while the physical human presence of teacher & student in the same room is becoming a LUXURY.

Recording more social, cultural and academic events that take place in the schools

Incentives for the teachers who socialize with students after school to take photos and write about it

Publication of short teachers & students interviews Etc.

FIFTH PRINCIPLE:

Make a careful, well thought-of, use of technology, as nothing more than another teaching TOOL to be used in class and/or after class, never placed at the centre of the learning experience.

New internal training programs and team of “IT academic managers”

Salary linked to the completion of annual training tracks, including technology training

Opportunities for lesson-plan sharing Etc.

SIXTH PRINCIPLE:

Offer the most PERCEIVABLE quality, as it suits to the most expensive solution to language learning needs.

All staff asked to look at the premises with new eyes each day, to immediately signal the tiniest imperfection

All staff asked to permanently think of anything that can be improved

Internal teacher training sessions on practical subjects such as decibels, classroom temperature, light, etc.

Project to display each room’s temperature, humidity and quality of air on a digital screen at each reception

SEVENTH PRINCIPLE:

Show with tangible data that our approach is the one that delivers the best RESULTS in terms of effective learning.

Systematic publication of exam results and comparison between students and non-students, in each segment and at each level

Level accreditation available for all, not only students, at a small price

Etc.

If it works in crisis-hit 2013 Spain, then it can work in every country, in every city and in every phase of the economic cycle…

The key is to always fight on “our” ground, not on “their” ground!

“The worst error in strategy is to compete with rivals in the same dimensions.

Don’t compete to be the best. Compete to be unique.”

As an IH school we have less choice than that: we must be unique AND the best!

Written in 1980, Competitive Strategy, has formed the basis of modern strategic thinking for three decades. The book is now in its 60th edition and has been translated into 19 languages. It is still a great book to read though the recent bankruptcy of Michael Porter’s company, Monitor Group, has someone tarnised the image of the management guru. 

Our SUPPLIERS (Ts) can’t dictate their conditions to us because:

We set the standards of the Industry

We have the means to substitute them (HR)

We MAKE them! (TT)

We discourage dangerous NEW ENTRANTS with:

Huge capital requirement (premises, publicity, academic staff…)

Learning curve

Economies of scale

We resist the threat of SUBSTITUTES by:

Sticking to a customer segment for which substitutes have a poor performance

Asking a much higher price because substitutes have a lower value

NOT selling substitutes!

BUYERS can’t dominate us because:

A strong Brand Identity allows a “take it or leave it” position (as long as we continue to offer superior value)

There are many potential customers waiting to be picked

The “top segment” has a low price-sensitivity

We can beat the COMPETITORS if:

They remain atomized

We occupy the best places with the best premises

We maintain the QUALITY difference (always being one lap ahead)

International House is NECESSARILY the winner, because…

ih alonso martínezih nuevos ministeriosih diego de león

ih ciudad universitariaih las rozasih sagasta

Where we must be, they cannot follow us.