For those who haven't read it or don't remember, here's the story: Two CEOs are walking in the woods and encounter a bear. In response, the first CEO leans over to tie his running shoes. The second CEO says, “What are you doing? You can’t outrun a bear!” And the first CEO replies, “I don’t have to outrun the bear. I just have to outrun you.”
It’s a shame that more companies don’t buy into this concept, but this is why I love this analogy—it shows the importance of staying ahead of your competitors when it comes to a risk. Okay, so an encounter with a bear probably isn’t the thing that’s going to send your company under. But imagine this scenario instead: You and your competitors are hit with a regional disaster, like a hurricane. If you can Identify the risks, assess those risks, develop (or already have) mitigation plans for that disaster and manage those risks better than your nearest competitor, that is a strategic advantage.
Why? Because if you can recover faster than your nearest competitor, their customers will invariably turn to you for price and delivery of the product they need—and if you can deliver, 7 out 10 customers that come over to your company will stay with you when your competitor gets back online. That’s called garnering additional market share—and it’s something every company wants.