Co-opetition: Compete and Cooperate Marketing
When you combine the words cooperation and competition, a new word emerges: Coopetition. Coopetition works when competing organizations come together cooperatively to serve a client.
Competition for the best clients and staff members has never been fiercer. Clients are demanding more value at less cost. Technology is turning many traditional services into commodities. The national and global economy brings competitors you have never heard of and don't know how to compete against. A new graduate can command a signing bonus, a new car, and rapid advancement. Banks and insurance companies are giving away tax advice to capture our clients. Business consulting firms are offering your clients technology planning, strategic planning, mergers and valuations, expert testimony, and many other services that compete directly with services provided by CPAs.
What many CPA firms lack is an approach that will enable them to prosper from these challenges rather than being victimized. The big secret is coopetition, combining cooperation and competition. Coopetition means joining with others to serve your client in innovative ways. Coopetition with your clients' other service providers is the key to serving the highly evolved client of the future. Coopetition lets you create a continuing stream of opportunities. The result is a true win-win-win situation for you, your partner, and your client.
Examples of Coopetition
Coopetition can be as simple as sharing office space with other CPAs. Or it can be a multifaceted approach like sharing offices and clients with other professionals. Coopetition can be low tech or high tech. Coopetition can be among separate CPA firm businesses or among different types of professional services firms.
BDO Seidman, LLP formed the BDO Seidman Alliance in 1994. The alliance is for accounting firms who wish to stay independent, but whose clients can benefit from a wide array of services offered by the international resources, financial services and tax solutions of BDO. James Hannon, a partner with BDO in New York is responsible for the alliance.
Dan Brooks, President of the McGladrey Network, says, "McGladrey & Pullen saw the need many years ago to cooperate with local accounting firms." McGladrey has been known for years for it's innovative audit practice and consulting services that it shares with the network members.
Dan Collier, President of Enterprise Network, an alliance of leading CPA firms across the country says, "Strategic partnering is one of the foundation stones of the Enterprise vision. CPA firms are challenged to meet the many needs of their clients today. Enterprise members (CPA firms with $1 to $10 million in annual revenue) cooperate with each other to provide client services they could not provide on their own. Cooperation actually strengthens our member firms' competitiveness. The opportunities for financial planning, technology consulting, international assistance, mergers and acquisitions capabilities and many other services are impossible for the small firm to develop on its own."
That is where the new associations are having such an impact. Coopetition helps firms overcome a lack of skills and capital. It permits forward-thinking owners to be highly successful in the new market place.
All one has to do is look around at all the cooperative ventures in other businesses. American Airlines has numerous travel partners from whom you can earn frequent flyer miles. Frequent flyer miles have become a strong travel currency, good at hundreds of hotels, restaurants, auto rental agencies, and airlines. Food establishments, once stand-alone franchisees, are banding together in food courts, interstate stops, convenience markets and cooperating to serve the customer. Microsoft and IBM cooperated around software. Microsoft and Intel cooperated around the chip. These cooperative ventures helped both the companies and their customers.
Consultant Bill Reeb says, "Mid-sized CPA firms do not have the capital to develop skills and deliver the range of services clients need and want. The only way is to collaborate with other CPAs or other professionals to serve the client."
Competing is usually a zero-sum game. But in coopetition, done right, there is more of a win-win-win. In cooperating, everyone gets a larger piece of the pie – and the pie grows.
When you are providing services to a client through a cooperative relationship with other professionals, you make it easier for clients to use you as a one-stop shop, and you make it harder for them to switch CPAs.
Some of the most effective sellers in the accounting industry today use cooperative alliances to attract better clients. Coopetition is the spirit of the new economy. It is the way in which we will master change and make the future work for us.
Excerpt from the book by Troy Waugh, Power Up Your Profits, 31 Days to Better Selling
Power Up Your Profits, by Troy Waugh.
"People buy for their reasons not yours." So the question is: What do they care enough about to fund action on today? This book will help you think about how executives prioritize and will lead to better profits!
Download a free chapter on www.waughco.com
Contact: Troy A. Waugh, CPA, MBA
Waugh & CO, Inc.
PO Box 1208 Brentwood
Phone 615-373-9880 Fax 615-373-9885