It’s not uncommon to begin a strategy and planning session with a thorough, open, honest assessment of the organization’s strengths, weaknesses, opportunities, and threats (SWOT analysis). It may be time to re-think this approach. Here’s why.
Consider the SWOT exercise which begins with a list of strengths. These mostly center on capabilities, equipment, processes, experience, and sometimes “we have great people”. Nothing wrong or even inaccurate here. However, this begs several questions. Among them, what will you do with this list once it’s completed? And, more to the point, if your primary competitors were having this very same conversation, how likely is it that their list would look similar, if not nearly identical to yours?
The idea of identifying and articulating your organizational strengths takes on far greater meaning when you instead focus on generating a list of your unique strengths. That is, what makes you different than your competitors? What sets you apart as the provider of choice among your targeted customers?
In his seminal article “What is Strategy”, Michael Porter makes the case that the essence of strategy is about being different. This differentiation marks a dividing line between you and everyone else. It addresses the question “what sets you apart from the competition in a way that gives you more running room in the marketplace, leading the way to greater margins and increased customer loyalty?”.
Unique, by definition, means one of a kind (first coined in French, taken from the Latin “Unicus”), like no other. What about your organization makes you different? Where do you stand out in a way that is unique?
During strategy sessions, the following question can help planners address the matter of differentiation: “If your business went out of business tomorrow, one just like it would be created the next day because somebody has to (fill in the blank)”. If this question is answered with a list of commodities (things others can easily do) your business may be short on differentiation which can negatively impact pricing power.
Listing organizational strengths, all of them that come to mind, can be a “feel good” exercise and there is something to be said for that. If your team prefers this approach, go ahead and list all of your strengths. Then, take a second cut at it by culling out those strengths that make your organization clearly different and better than the competition.
Making this subtle but important change, moving from listing your “strengths” to identifying your “unique strengths” may yield a shorter list, but one that is far more powerful and useful. These unique strengths are raw material for developing your corporate strategies; how you will leverage your competitive advantage into a compelling and enduringly successful plan.
For more tips on strategy and planning for your best future, contact me at firstname.lastname@example.org.