Written by Chris Mason – Mindshop Founder
Thanks to fellow Mindshopper Mario Vicari, I found a book that takes all of Michael Porter’s work and distills it into some practical tips in one book. The book, Understanding Michael Porter: The essential guide to competition and strategy (Magretta, 2012), has a large number of interesting tips, but five stood out to me, in part, because I am currently working on the next step-change strategy for Mindshop.
The first tip to contemplate is “strategy explains how an organization, faced with competition, will achieve superior performance. The definition is deceptively simple” (Magretta, 2012, p.20). This quote resonates with me due to the focus on performance relative to the competitors. This is a daily measurement that reminds me that we at Mindshop have to have superior performance every day, regardless of what the competitors or markets are doing.
The second tip is “competitive advantage is not about beating rivals; it’s about creating unique value for customers. If you have a competitive advantage, it will show up on your P & L” (Magretta, 2012, p.184). This builds on my first thought, that my superior performance may not beat the competitor; this may be due to a multitude of reasons, including that I may want to be a different size to my competitor, or not desire the type of client that they have. The competition is not toe-to-toe, in-the-trenches competition, it is all about superior performance (and values).
The third tip is “strategic competition means choosing a path different from that of others” (Magretta, 2012, p.30). So if you accept that the competitive goal is superior performance, then it makes sense to achieve that performance using methods different to the competitors. I have always done things in a way that others either do not understand, or believe are a good way to operate. Either way I have created a point of difference.
The fourth tip is “the value proposition is the element of strategy that looks outward at customers, at the demand side of the business. The value chain focuses internally on operations. Strategy is fundamentally integrative, bringing the demand and supply sides together” (Magretta, 2012, p.97). What this is saying is that you need to define where you will have superior performance and then back it up with continuously improving the efficiency of your internal operations.
The fifth and final tip is “there is no honor in size or growth if those are profitless. Competition is about profit, not market share” (Magretta, 2012, p.184). This tip serves as a reminder that we need to be the most profitable, not the biggest in top-line revenue or head-count.
Consider these five tips in context of your own organization. What should you do to meet the requirements of all five? Is your current strategy going to work for you in the coming next few years?
Written by Chris Mason – Mindshop founder
I had a client this week with one of his customers, actually a group of customers, who he perceived had really great ideas but just didn’t get around to implementing those ideas. He was frustrated and wanted to get my view regarding how to resolve this. Rather than respond with the general “do a force field and see what it suggests,” I decided to share some theory on change management. As it turned out, he went with the force field idea, but my email to him made me realize that we try to change people with little or no idea about the theory behind change, so here it is!
The theory that makes sense to me is the theory of planned behavior (TPB; Azjen, 1991) where he suggested that our behavior that creates a specific change (to reduce our alcohol consumption, stop smoking, or to implement change in our business) is driven directly by our change intentions. In other words if we intend to change something we have a good probability of doing it.
So what drives our change intention? According to Azjen there are three things:
- Our attitude to the issue (do we think that the change is a good thing)
- The subjective norm (what our peers think about the issue)
- Our behavioral control (the degree of difficulty we think we are facing)
In my client’s change situation the variables based on Azjen’s (1991) TPB he needed to decide where the problem was: their personal attitude towards change, the groups’attitude to the change, and the perceived degree of difficulty in the task. Once he decided where the blockage was it would be a simple task to develop some specific actions to resolve the situation. For example, if the subjective norm is the issue I would pick a couple of the early adopter members of the group and engineer some change success and get them to talk about it (and publicly reward and recognize them for doing so). If the problem was in behavioral control I would give them a coach to help them create and maintain the change.
If all that sounds like too much theory, of course you can just do a force field on it (see this link of me doing one). But why not use the TPB and then do a force field on the specific issue that is blocking your change?