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Four Characteristics of a Well Defined Strategy



Michael Porter, one of the 90’s leading business thinkers from Harvard University and author of “Competitive Advantage” and “Competitive Strategy,” stated, I would argue that the need for strategy is greater in small companies or start-ups than in larger companies. Small companies really lack the resources, momentum and means to coast along the way larger companies do…”


This is likely the most important task that anyone leading a new venture or charged with improving the performance of an existing venture must undertake.


Without a well-defined strategy, your tactical plans are like winning the battle but not the war. A lot of good effort and resources have been wasted.


Most business leaders confuse strategy, objectives and tactics, often putting the horse before the cart and thinking about the “how” before they’ve fully decided on the “why” and the “what.”


A strategy’s strength is not in its initial moves, but rather in how it anticipates the reactionary countermoves of the competitors and changes in customer demands over time.


READY AIM FIRE

Not

AIM READY FIRE

Nor

FIRE READY AIM


Download Challenge #5 today, this challenge will help you to answer questions that will determine if you’re ready to lead a competitive strategy.


A strategy's strength is found in how it deals with the dynamics of changes caused by other technologies, governmental regulations and influences from other expert sources. Ultimately, it is wise to remember that it is not how good the product or service is, but how good its perceived value is to the customer, relative to the competitors’ offerings.


The strategy should put barriers in the way of competitors once a competitive advantage is achieved and sustain or renew that advantage at every possible opportunity.


When strategy gains the advantage, it must sustain it and control its erosion. To do this, your strategy must demonstrate:

  1. Superior customer value. This must be expressed in benefit statements that exhibit one of the three “E’s” of product positioning. These are:

  • Is the product Excellent? Does it have or can it develop a strong reputation for quality and service excellence?

  • Is it Efficient? Does it improve the way things are done?

  • Or is it Economical? Make no mistake this is the lowest price. This is also the lowest form of competitive advantage.

Don’t be confused. A product can only stake a major claim in one of the above categories. For example, if someone were to offer you a product known for its excellence at a really low price, what questions would you ask? Would you doubt the integrity of the offer? YES!!


A product might take a primary position as “excellent” and also claim a secondary position as “efficient.” Please note that you can craft benefit statements that demonstrate both efficiency and cost-effectiveness.


The first step in any strategic product plan is to decide on which of the three “E’s” to stake your claim. The best way to determine this is by market research very early in the product development cycle.


Download Challenge #5 today, this challenge will help you to answer questions that will determine if you’re ready to lead a competitive strategy.



1. Endurability. With rapid technological change and shifts in customer buying preferences, can your product gain a strategic advantage? Ask yourself, “Will my organization be able to maintain this advantage long enough to achieve financial returns that will meet our expected return on investment?”


2. Covert Advantage. Can the reasons you are able to deliver points 1 and 2 be kept from the competition? Are your sources of advantage ambiguous?



3. Boundancy. This may be a new term that you have not heard before. It means:

  • How do I bind the market to maintain my advantage even when my competitors know and understand the scope of my advantage?

  • How is a competitor denied access to a critical resource that you have access to?

  • Can the competitor be restricted from technology because you have protected it or kept it as a trade secret?

  • Are there applications that will keep improving your market advantage and keep your competitors struggling to catch up?


4. Retaliation. “Don’t mess with me because if you do I will…” Remember the threat of retaliation must be public. You must be able to deliver when needed. Before exposing this card, be sure you have the capability to act, then act quickly and decisively.


Download Challenge #5 today, this challenge will help you to answer questions that will determine if you’re ready to lead a competitive strategy.



Without a well-defined strategy, you cannot paint the pictures of your future that will convince your stakeholders that the endeavour and cost of gaining the advantage are worthwhile. Business is not a game to be played for practice.

  • It is real

  • It is for keeps.

  • It is how leaders feed families.

  • It is how countries get the taxes needed to support those who need help.


So, if you are the leader of a group trying to develop and implement a strategy to win, you had better be sure that your venture’s purpose and vision are well defined.


The strategy that evolves from purpose and value statements should be competitive, compelling and doable for those who want to stretch.


As a leader, the reasons to be in the game are:

  • To win the game.

  • To gain a competitive advantage in your predetermined marketplace.

  • To build and maintain the drive needed to expand on that advantage. As Ted Turner said, “Lead, follow or get out of the way.


Download Challenge #5 today, this challenge will help you to answer questions that will determine if you’re ready to lead a competitive strategy.



If you are not the customers’ first choice, then your competitors will whittle away at you, just through price chopping alone. Yes, a low price may be a strategy, but it is not the one that will maintain a company over the long haul. Remember, the lowest price advantage is the lowest form of competitive advantage.



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