As a leader, you're always scanning the horizon for potential challenges and dangers ahead. And there's one in particular that can shake even the most confident of executives to their core.

What if a brand new competitor were to open its doors tomorrow. One that quickly becomes highly profitable, drawing customers in droves and dominating the market share like no one else in your industry - including you. What's worse, its leaders seem to know exactly how to navigate every obstacle and turn it into an advantage.

Feeling queasy yet? Take a few deep breaths, because we're going to take an even closer look. As you answer these questions about this 'perfect competitor', you may want a pen and notepad by your side:

1. What are they doing that you don't?

What is it about this new arrival that makes them so attractive to your customers and clients? What is your perfect competitor doing that you aren't? More precisely, what management or marketing strategies are they using that you're not?

Is their pricing structure different? Or their cost structure? Are they delivering added value to customers in a way you're not (yet)? What about their marketing channels, and their sales practices - how different are they from yours, and specifically in what way?

2. What are they not doing, that you are?

When you conjure up your perfect competitor, and watch how they go to market, are they freed from any legacy activities, habits, attitudes or other liabilities that are holding you back?

When, in your imagination, you see how they build their business, do you feel trapped by existing product lines, service offerings, geographical locations or other commitments that you have made but you wish you could get out of? Do you wince when you think about any of your existing supply chain agreements or internal policies or procedures you wish you could be free of?

3. Who do they employ?

Let your imagination drift into your perfect competitor's premises. Roam their corridors, offices, showrooms, factory floor, labs - wherever their people are. What does their workforce look like? What's their demographic? What skills, and just as importantly, what attitudes do they have? As you float around in your disembodied state, take a sense of the morale and level of engagement you see - does it differ from yours, and if so, how?

Do you and they fish in the same pool for high-quality new recruits, or are they fishing somewhere else altogether? How many of your people have they poached? Have they raided your workforce for top performers, or have they passed them by to go elsewhere?

4. What does the top team look like?

While we're floating around your perfect competitor's premises, let's take a left turn just the end of this corridor. See the group around that conference table? That's their top team, ensconced in what looks to be a weekly meeting. What are they discussing? How are they interacting? Look over someone's shoulder and take a glance at the agenda - what sort of things are included there?

How is your perfect competitor managing the business, compared to how you manage yours? This being your worst nightmare, what skills, attitudes or processes do their top team bring to senior management that your team is missing?

5. What do their customers say about them?

Let's assume that your perfect competitor has been in business for a while - it's time to go out and poll their highly-satisfied customers and clients. What sort of things do they say about their experience? What words and phrases do they use? What specific aspects of their interaction with your perfect competitor do they mention most? What surprised and pleased them beyond their expectations?

Be as specific as possible - write down the exact terms you imagine your perfect competitor's very happy clients use when describing their experience. How does it compare to your existing customer feedback? What words and phrases do your customers also use about you, and which are mostly absent?

It's wake-up time

As I'm sure has become clear, this isn't really your perfect nightmare - or at least, it doesn't have to be.

Take a look at the answers you jotted down to the questions above: How much of a gap is there between your business and that of your imagined perfect competitor? How readily can you bridge that gap? What if you were to prioritize the four or five most important distinctions between you and your perfect competitor, and turn that list into a strategic plan to become your own 'worst nightmare'?

Someday that perfect competitor may appear on your doorstep, just like in the dream. Wouldn't it be better if that perfect competitor was you?

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