The most successful organization over time are clear on their sustainable competitive advantage and leverage others’ tools and components along with internal and external enablers to drive their important differentiators. The enablers are either common to all or similar to what others can do. Leverage them to support and reinforce the few differentiators required to win without thinking for a moment that they matter on their own.
Consider the components of sustainable competitive advantage, important differentiators, internal and external enablers, and things for which you tap into others.
Sustainable competitive advantage
The heart of sustaining competitive advantage over time is a shared purpose, clear core focus and winning culture. This goes to why you do what you do and who you are.
Shared purpose gets at your mission, vision, and values. Mission is why you do what you do, why the world needs your organization. Vision is your picture of success, what the world will look different then. Values are the bedrock upon which how you do what you do is built.
Core focus. All organizations design, produce, sell, deliver, and service. The most successful over time understand their core focus and align everything around it.
Values of integrity and respect are always foundational. All the individuals on a high-performing team must act with honesty, transparency and ethical conduct in all aspects of their work. Further, those individuals must treat each other with mutual respect.
The third value for a high-performing organization, along with how to organize, operate and the CEO’s main task, all flow from the organization’s core focus.
- For design-focused organizations, its third value is likely innovation
- For production-focused organization, accountability
- For delivery-focused organizations, collaboration
- For service-focused organizations, customer-centricity
Culture. Given enough time and money, your competitors can duplicate almost everything you’ve got working for you. They can hire away some of your best people. They can reverse engineer your processes. The only thing they can’t duplicate is your culture. By culture, I’m referring to the common behaviors, relationships, attitudes, values, and environment.
Important differentiators
The two critical strategic questions are where to play and how to win through the creation and allocation of the right resources to the right place in the right way at the right time over time. The three most important differentiators flow from that:
- Your strategic process, turning your winning strategy into winning plans.
- Your organizational process, laying out and implementing future people capability plans.
- Your operating process, driving the practices operational excellence.
Enablers
Whether they are internal or external, enablers play a supporting role. They’re not the stars. The stars are the differentiators that set you apart from others. They are things required for your stars to play their parts.
While your internal enablers are similar to what others can do, these are things you choose to do in-house to ensure their tight alignment with and easy access by your differentiators. These include technology, data, finance and governance.
Your external enablers may be either less closely aligned like investment or mergers & acquisition work or deliberately external, like your board, to bring in outside perspectives.
Tap into others
The last category are things for which you tap into others. By definition, everyone can tap into the same things here. These are tools and components that feed your enablers which, in-turn, feed your differentiators.
Airlines have different differentiating strategies with some providing a higher-end experience and others providing low-cost transportation. In every case, their actual airplanes are enablers and, in almost every case, they tap into others to get people to the airports and provide the airport infrastructure.
Implications for you
- Start by getting all aligned on the drivers of your sustainable competitive advantage: purpose, focus and culture. Nothing else matters if you don’t get this right. This goes to who you are and why what you all do matters.
- Invest the time to think through and implement your points of differentiation across strategic planning, organization and people, and operational excellence. This is about choices and how you’re going to win.
- Relegate everything else to a supporting role, whether they are internal or external enablers or things for which you’re going to tap into others. You won’t win by over-investing in these. They only matter as enablers of differentiators in line with your sustainable competitive advantage.
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