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Friday, September 27, 2013
Is a sustainable competitive advantage still possible?
to Colombia BS Professor Rita Gunther McGrath, achieving a Sustainable
Competitive Advantage (SCA) (establishing a unique competitive position that can
be sustained for long periods of time) is nearly impossible these
McGrath introduces a new term "Transient Advantage", which emphasizes that competitive advantage has become brief, temporary, passing, provisional, temporal. Companies must learn to launch new strategic initiatives again and again, creating a portfolio of advantages that can be built quickly and abandoned just as rapidly.
create an innovation pipeline or portfolio of advantages, companies need to
apply eight shifts in the way they operate and think about
1. Think about arenas, not industries (threats can come from
players outside of your industry)
2. Set broad terms and then let people
experiment (allow freedom to be creative)
3. Adopt metrics that support entrepreneurship
Focus on customer
experiences and solutions to real problems
5. Build strong personal
relationships and networks
6. Avoid brutal restructuring and learn healthy
7. Get systematic about early-stage innovation
Experiment, iterate, learn.
And most of all: leaders must recognize that fast
and roughly right decision making must replace deliberations that are precise
Transient Advantage: Rita Gunther McGrath in HBR June 2013, p62-70