Are you a Strategist? You have a Key Role in Creating Sustainable Competitive Advantage

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Are you a Strategist? You have a Key Role in Creating Sustainable Competitive Advantage
Anneke Zwart, Moderator
Most organizational performance theories assume that there are certain “best practices” or “best ways” needed to outperform your rivals.
This seems to be true for some competitions, such as cookery and gardening.
But in competitions such as business (and sports and games) such a certain “right way” that will lead one to victory does not exist. In such competitions applying a certain standard or “best practice” will simply not suffice to outperform others.
Rather, in business competitions you need a particular skill or intellect that is singular (special) and non-repeatable so as to be able to create sustainable competitive advantages.
So, in order to design a business that has a sustainable flow of wealth, a singularity needs to be generated instead of following generalized standards and theories. Strategic thinking is therefore critical in creating competitive advantages since strategic thinkers try to find solutions for each different situation by using powerful insights and by looking at what is singular in each situation.

Generalized theories and systematic ways can support in finding potent insights and in generating conditions that are helpful in discovering these insights. But the actual discovery of those powerful insights that create profits depends on asymmetric market knowledge rather than on standardized theories.

That is why successful businesses invest in business strategists: they try to explore the market to find powerful and unique insights so as to outperform rivals.
Source: Goddard, J. (2013) “Why Some Companies Consistently Outperform their Rivals” Business Strategy Review Vol. 14 Iss. 4 pp 7

Strategists are Indeed Important
Alex Korokeyi, Member
I quite agree with you because competitive advantage comes with a lot of situational thinking that is strategic at every point a business decisions is to be made. The good reading of the interplay of environmental factors by the players requires skilled personnel with vertical and horizontal perspective.

If it is not Different, It's not Strategic
Bernhard Keim, Premium Member
I fully agree on the topic. Business is not a game where the same rules and principles have to be followed by all participants. It's not about the game, it's about the audience.
Invent new games that people like more. Best practice just tries to copy others, but does not take into account that people don't want a better lawnmower, they want their lawn cut. If there are better ways to achieve this, with less effort and costs, people will embrace the solution.
This type of innovation is beyond best practice as there is no practice for the new solution, yet.
Nevertheless even the new solution has to be provided in a superior way. Otherwise the company's solution will be copied by new competitors that can do it better.

Involve Lower Staff too in Strategic Innovation
lenworth grandison, Member
I could'nt agree more, I think inovation quite sums it up: an organization simply cannot create real wealth by simply doing what everyone else is doing. Board members of most big organizations keep looking to the CEO to come up with new and bright ideas to take the company forward.
What you really need is new, forward, critical thinking, new set of eyes, looking outside in, hence a marketing strategist. Sometimes your greatest ideas come from some of the most unlikely places. Lower level staff... They are customers too who would have a fair idea of how the company and it's products are perceived, and can offer great ideas.

Strategists Must have a Dynamic View from the Stratosphere
Sudheendra, Member
Strategy as the name indicates is a view of the facts from the stratosphere regarding details on earth. It also considers the relative movement of objects on earth. This differentiates it from a "bird's eye view" which is a static picture. Business dynamics require strategists because an evaluation of the business needs constant review about movements, trends, new entrants and a host of similar factors which affect business. Though Strategy is to basically counter the competitor moves, one also needs considerable look out on emerging trends, new entrants in business, newer technologies that could render existing businesses obsolete etc.

Good Practices, Not Best Practices
srinivas, Member
I consider there are no best practices and only good practices.
If organisations focus on continual improvement, good practises get better and better over time.

Good Strategist Knows Best Practices in the Strategy Process
Kurt Ludikovsky, Member
In my opinion In your statement you are
- Right if you try to simply copy the best practice, then there will most probably be no innovation
- You are wrong if you take the underlying method and apply it to your business.
Compare it to project management. Each project is different, so you can't just copy a project. But the underlying principles of project management are the same. So applying a process to do some task to come up with a proper project will lead to an efficient (and possibly even effective) result.
A good strategist will have some processes which he can apply to come up with a feasible strategy which fits the company.

Strategy Is: Know the Game and Know your Strengths
I quite agree with your submission, strategic thinking definitely gives you an edge in any competitive market. You must know the game and your strengths. You must understand what you have to offer vis a vis what the competition is offering. Are you able to create a niche for your product. Can you use and maintain your strength.
A constant review of your strengths will assist you to know when your strength may become a weakness and you need to re-strategize to stay ahead of the competition.

Strategy and Initial Conditions
zephir, Member
Among the necessary insights that may be needed, I think that one can start with a few common methodologies such as stakeholder analysis and a little bit of blue ocean:
- Stakeholder management will help one to assess the context and his personal stake(s).
- Blue ocean can help you make competition irrelevant.
Both start with the best possible understanding of the strategic context through significant factors. Sustainability comes with the span of your stakeholders analysis. The success of your strategy depends on how many stakeholders already share your direction and how many you can influence to share your goals.One needs to be realistic about who will support you and who will not.

The Importance of Strategists for Firms
Jaap de Jonge, Editor
It appears we all agree that:
1. Having a competitive advantage (CA) is extremely important for any firm, and
2. Strategists are crucial to achieve and maintain it.

Strategists versus Scenario
Rick Rohr
I have been a proponent of strategic thinking but lately have been leaning towards scenario planning. My new found learning of scenario planning has led me to believe that it is more flexible, brings in view points you otherwise might not have considered and does not keep you painted into the single strategic box of getting from point A to point B in order to determine success.

Strategists in Real-life Business Practice
Rey Lopez, Member
Dear Anneke, I couldn't agree more with you. It's also true that strategists are not necessarily a product of Universities. Schools all over should focus their attention on developing this kind of professionals and get them ready to tackle any challenge in real-life business practice.

Strategists as Captain of a Ship
Mahmood Azizi, Member
I agree with topic and I suppose strategists are like a captain of a ship, they should know well about the principles of Game Theory in order to stay in their market and be competetive.

Where Strategists Play a Crucial Role
Mellacheruvu Adi Saasthry , Premium Member
With deeper insights in to various arenas, strategists play a vital role. Things are not simple nor straightforward.
It involves a great amount of alignment of various aspects

What is the Role of Strategists in Scenario Planning?
Jaap de Jonge, Editor
@Rick Rohr: Thanks for bringing up Scenario Planning.
Some people will say that scenario planning is just one form of (emergent) strategy formulation. But there are also considerable differences between more traditional ways of strategic planning and scenario thinking.
In my opinion, there are at least 2 differences between the two approaches concerning the role of strategists:
A. In scenario planning / thinking you're not primarily looking for a competitive advantage, but rather to create a more flexible, learning organization and better prepared decision-makers to deal with future scenarios once they occur. Strategists can prepare and facilitate this scenario learning process.
B. In scenario planning more people are being involved in the process than typically is the case in strategic planning, including non-strategists.

Some More Thoughts by Goddard on what Strategists should and shouldn't do
Bernhard Keim, Premium Member
To understand better what Goddard means, see also another article by him in Business Strategy Review 2010, Q2: "The Reality of Costs". There he mentions that best practice is often confused with being the cost leader.

"Comparing your cost with a competitor’s cost (a remarkably popular form of benchmarking) can only be relevant if both companies are competing with identical strategies, in which case the cost base is carrying the entire burden of delivering profitability. But if this is the case, the problem is not the magnitude of the cost base but the absence of strategy.The attention of management should not be focused on relative efficiency but on the need for a differentiating strategy. In short, reliance upon efficiency usually betrays an absence of strategy. The rhetoric of ‘operational excellence’ is generally camouflage for a dearth of strategic ideas."

So in short: Costs have to follow strategy, strategy should not follow costs. Pure cost cutting with reference to some "best practice" will never provide competitive advantage. Costs are the outcome of a strategy, never the goal of a strategy.

Strategic Thinking AND Scenario Thinking
Evgeniy Lavrukhin, Member
To my mind, the main difference between strategic thinking and scenario thinking, is that the latter is more solid and sustainable from the formal side of the matter. In scenario max. details are to be observed and certain outcomes/ decisions follow.
Whereas in strategic thinking (I fully agree with all advantages mentioned before) is more flexible to the circumstances and therefore more personalized.
In some organization it may be hard to justify especially when some time has passed, for auditors.
Anyway, BOTH of them are to be utlized, depending on certain circumstances.

Best Practices May Be a Basis for But is not Equal to Competitive Advantage
Wolfgang Kerstner, Member
(1) If any organizational performance theory suggests to rely (only) on best practices to outperform competitors, it is wrong. My experience tells me that best practices are adopted as a starting point. As long as no better procedure/standard is known, you might want to use what has been working best so far, right? But most importantly, on top of that organizations have to find their individual competitive advantage.
2. The word "best" in best practice refers to something what has been turned out to be the most effective alternative (i.e. the best option) at that particular point of time, to be used in order to get something accomplished. Of course, through continuous improvement, the best practice may eventually be improved. Then the improved practice will become the "best", and so on.

Best Practice is not Enough to Outperform your Rivals
Jaap de Jonge, Editor
@Wolfgang Kerstner: Well put, I agree. See also the in-depth discussion: Best Practices or Next Practices? for more details about the (limited) value of best practices.
Detailed knowledge of the best practice in a particular business process is normally not the domain of the strategist, but of the business process owner. Although it can be helpful if the strategist has a good high-level understanding of the business processes at hand.
Do not confuse this with knowledge of best practices in how to conduct a strategy formulation process, which obviously IS inside the domain of the strategist.


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