Creating Competitive Advantage: Strategies That Work
Wharton@Work recently sat down with management professors Harbir Singh and Nicolaj Siggelkow to talk strategy — specifically, creating and implementing strategy that creates and maintains competitive advantage.
Wharton@Work: You are the academic directors of Creating and Implementing Strategy for Competitive Advantage (formerly called Strategic Thinking and Management for Competitive Advantage). What kinds of issues do the participants bring to the program?
Nicolaj Siggelkow: We spend the first session talking about the specific, real-world challenges that keep them up at night. One issue is creating strategy, both assessing their current strategy and developing new ones with a better, more structured process. The other is around execution; strategies don’t work if everyone is doing their own thing, so your leadership is critical. You can’t just build it at the top and hope it filters down.
Harbir Singh: Once we know the kinds of issues they are dealing with, we get that information out to the faculty who teach in the program. We have some of the world’s leading authorities on strategy, leadership, innovation, and execution, and they tailor their content to address the real challenges of the participants.
W@W: How does competitive advantage fit in?
HS: Only ten percent of companies that have a competitive advantage are able to maintain it. We first talk about creating that advantage, which has to do with positioning in market, identifying the customer market segment you want to be in, and understanding sources of profitability. You also have to understand what kind of organization you have, how you can inspire people to be more creative, how ideas come to the table, and how you sort through those ideas to identify the best ones. Then it is about execution, innovation, incentives, and rewards, and how they align with the strategy.
W@W: How do you ensure that the senior strategists in the program are able to go back to their organizations and implement what you are teaching?
NS: It is very application-oriented. We provide tools to help manage growth initiatives, to structure mergers and acquisitions, and to position the firm relative to competitors. We also create activity system maps to delineate how interdependent choices either support or erode a strategy. Everyone begins using these tools during the program and can then apply them when they go back to work on Monday morning.
HS: Application is also dependent on leadership, which is a focus of the program. Leadership and strategy are intertwined, so strategy has to be implemented in light of someone’s leadership style. Our participants have to share what they learned and, as leaders, set a vision and inspire others to execute it. To do that, you need to understand what motivates people.
W@W: Isn’t the implementation stage where things typically fall apart?
HS: The research on implementation has a lot of contradictory advice. It’s not because someone is wrong, but because implementation is very situational.
We provide a template for designing a strategy and socializing it within the organization. They can use it to list some of the initiatives they will propose, who they might engage, and what the stages of implementation will be. This lends order to the process. Creating strategies that will help you sustain competitive advantage isn’t about luck — through years of research and practice, we know what works.