Week 4: Clear - Operational Effectiveness Needs Accessories

Make Sure Your Firm Is DRESSED To The NINES! 
As every fashion sense woman knows, having a "Little Black Dress" (LBD) in your wardrobe is critical - you know, the one that gets you through every occasion with class and style!  All you have to do is just switch up the accessories and your LBD so graciously gives you an entirely different look that is spot on for the occasion you are facing - now how fabulous is that!! 

No matter what industry you are in, how many employees are on your payroll, what goods, services, or products you provide, or where your firm is located in the world - EVERY FIRM should strive to be EFFECTIVE and EFFICIENT.  Should your firm be not able to accomplish this, I dare confidently say that your firm will probably not successfully survive in today's business world. 

Operational Effectiveness (OE) - doing what every other firm in your industry is doing but doing it better (effectively and efficiently) - it's clear to me that OE is definitely the LBD that your firm needs to maintain a Sustainable Competitive Advantage (SCA) - financial performance that is consistently above the industry averages!  However, OE alone just is not enough to get and keep the job done successfully.  Like all LBDs, OE needs the right accessories.  So to help your firm successfully achieve and maintain SCA, you must accessorize OE with the following (If you are not sure what the difference is between OE and strategy - watch this video before you read on):
 

http://www.youtube.com/watch?v=e5w3s4rckdA

"Video uploaded to YouTube by PotentialTra , 2011. Permission granted to reuse with YouTube Standard License."

1. Strategic Positioning - by doing what your competition isn't doing or do what they are doing but in a different way, you will create and/or strengthen strategic differences which will give your firm an advantage that will be difficult for your competitors to match.
2. Resource-Based View of Competitive Advantage - if you are to successfully maintain a SCA, you must control an exploitable resource(s) - but not just any old resource.  This resource must have the following critical characteristics: 1) it must be valuable; 2) it must be rare; 3) it must be hard to copy/imitate; and 4) it must be nonsubstitutable. 
3. Imitation-Resistant Value Chain - Your value chain is what you do to create and bring your products/services to market and if you create a unique way of doing this you will have an edge on your rivals that will last a very long time. 
4. Scalability - as your firm grows, you will gain scale advantages like those from economies of scale. Being able to spread your cost over an increasing number of products and services will increase your profits drastically. 
5. Differentiation - is what sets your firm's products/services apart from all the other firms'.  Grab and keep your customers' attention by using differentiation to breakout of the cookie cutter madness and to elevate your products/services above commodity status.
6. Distribution Channel(s) - is the path(s) you use to distribute your products/services to your customers and is one of the key players in your firm's success.  If you get everything else right but fail here - your customer will not get the opportunity to even think about choosing your goods let alone buying them...
7. Patents/Intellectual Property Protections - do not drag your feet here - make sure you take quick action to protect your firm's creativity, innovation, inventions, etc. anything that can be copyrighted or patented.  Doing this will give you some degree of protection from the firms out there who are waiting to reap benefits from your firm's blood, sweat and tears.   
8. Porter's Five Forces/Industry Competitive Analysis - the five (5) forces are 1) rivalry among firms already in the business; 2) the threat of new firms entering the business; 3) the threat of a substitute for your product(s)/service(s); 4) the bargaining power of your customers; and 5) the bargaining power of your suppliers. Do yourself a favour - use these factors to do an Industry Competitive Analysis so that you know your firm, your industry and you are not doing business blindly. 
9. Technology - last but not least, the icing on the cake - or should I say the finishing touch! Use the enabling characteristic of technology to help you leverage in each of the areas mentioned above and your firm will certainly be a leader in your industry. 

Again, make sure that your firm is DRESSED to the NINES!  OE should never be without the proper accessories. 
So get out there and make sure that your firm is prepared with a properly accessorized LBD - a Successful Firm would NOT be caught dead without one!!