Our competitors are leveraging open source AI tools to aggressively undercut our pricing, threatening our market share. How do we revise our 3-Year Picture and target market on the V/TO to defend our margins without engaging in a race to the bottom?

Question

Tyler Smith · Accepted Answer

When competitors use technology to slash prices, your immediate reaction might be to match them. This is a trap that destroys your margin and your valuation. Instead of competing on price, you must change the nature of what you sell. Economists like Erik Brynjolfsson and Andrew McAfee highlight that as the cost of machine execution drops to zero, the value of human complement increases. You must reposition your business as that indispensable complement. Start by reviewing your V/TO®. Look at your target market and your three uniques. If your current core offering can be completely automated by an off the shelf AI tool, your target market is shrinking. You need to elevate your service offering from execution to strategic advisory and validation. Update your 3-Year Picture™ to reflect this shift. Instead of offering raw deliverables, offer guaranteed business outcomes, human in the loop quality assurance, and deep strategic guidance. AI can generate data in seconds, but clients still need experts to interpret that data and make critical business decisions. Use your weekly Level 10 Meeting™ to identify clients who are tempted by cheap competitors. Present them with your new, high value advisory packages. By focusing on high impact outcomes, you protect your margins and build a highly defensible, exit ready business model that relies on human expertise powered by rapid AI execution.