THE HEDGEHOG CONCEPT

Chapter 5 of Jim Collins’ Good to Great introduces the Hedgehog Concept.

Put simply, the Good to Great companies had developed a deep understanding about the intersection of the following 3 circles within their organization.

1. What you can be the best at?
2. What drives your economic engine?
3. What are you deeply passionate about?

Once a business has their Hedgehog Concept in place, they can plan a strategy and a set of systems all around achieving that goal. One of the strategies a business will want to consider is a guarantee.

In 1993, Christopher Hart wrote a book called Extraordinary Guarantees. In the book he outlines the extraordinary power that guarantees have to help businesses build market share. The book details his research into guarantees and their power to also create extraordinary organizations.

Guarantees give your customers a reason to believe your stated benefits. Customers respond well when a business is willing to stand behind its product or service. Consider this additional fundamental point – Whenever a customer makes a purchase, they take a risk as to whether or not the product or service will meet their needs. When you think about it logically, then the fact that they’re taking a risk can hamper the decision making process. A proper guarantee can reduce or remove the risk.

Consider this guarantee from the Valorem Law Group of Chicago:

“If you’re interested in seeing whether we are right for you and your team, try
us on a manner. What separates us from our competitors is that you have
our value promise on every invoice. If you don’t think we’re worth the
amount you agreed to pay, you make whatever adjustment you think is
necessary. If your other firms don’t walk that talk, it’s time to try
Valorem.”