Last month, I wrote about the telltale signs of a doomed strategy. Today I want to write about the foundation of creating a successful strategy that builds sustainable competitive advantage.
As I’ve mentioned in previous posts, A.G. Lafley and Roger Martin do a great job in Playing to Win of showing the common factors that demonstrate a winning strategy.
- An activity system that looks different from any competitor’s system. It means you are attempting to deliver unique value.
- Customers who adore you and noncustomers who cannot see why anybody would buy from you. As counter-intuitive as this may seem (who wants to be disliked), it shows you have made clear choices to cater to your customers.
- Competitors who make a sizable profit doing what they are doing. Again, it seems counter-intuitive but it means your strategy has left where-to-play and how-to-win choices for competitors who do not need to attack the heart of your market to survive
- More resources to spend on an ongoing basis than competitors have. This shows you are winning the value equation and have the biggest margin between costs and price and the best capacity to add spending to take advantage of an opportunity or defend your turf.
- Competitors who attack one another, not you. It means that you look like the hardest target in the industry to attack, usually because of your strongest bonds with your customers.
- Customers who look first to you for innovations, new products, and service enhancements to make their lives better. This means your customers believe that you are positioned uniquely to create value for them.
Just as the traps I wrote about last month are clear signs there are problems with your strategy, if you are hitting most or all of the above points you are on your way to building long-term, sustainable competitive advantage. If not, they show where you should be refining and focusing your strategy to succeed.