The End of Competitive Advantage: How to Keep Your Strategy Moving as Fast as Your Business by Rita Gunther McGrath.
Reprinted by permission of Harvard Business Review Press. Excerpted from The End of Competitive Advantage: How to Keep Your Strategy Moving as Fast as Your Business. Copyright 2013 by Rita Gunther McGrath. All rights reserved.
The way we think about the concept of strategy needs to change. Where we took for granted in years past that the ultimate goal of strategy was to achieve a sustainable competitive advantage, we really need to be thinking about transient advantage–when individual advantages come and go–rather than believing they will be with us forever, or at least for a long period of time.
The best organizational strategies in such an environment are those that promote reconfiguration of the business rather than having drastic layoffs or downsizing. Learning to be competent at disengagement will be important. Mastering the resource allocation process and wresting control away from powerful vested interests within the organization will be significant. Being systematic about innovation will not be optional. The executives and leaders who succeed will bring a different mind-set to their businesses, one that favors candor and is unafraid to confront bad news. The consequences are that the rules for personal success are being rewritten.
The consequences of these changes for those people pursuing a traditional career path have in many cases been dire. In a world of transient advantage, the only employees a company will keep are those its leaders believe to be indispensable to its future.
An alternative is to abandon the idea of a more or less linear career path altogether. In ambiguous and uncertain settings, it's not clear what skills are going to be valuable, which connections will matter most, or what the business model in which you'll eventually participate will look like.
As the journal Fast Company has been exploring, "flux" is increasingly the norm for the careers of more and more people. They will find themselves moving from gig to gig rather than moving up a ladder. More moves will be horizontal. And the organizations that create these opportunities may be temporary themselves.
How Vulnerable Are You?
Just as I would encourage companies to anticipate that their competitive advantages may go into decline, I would encourage people to anticipate this, and to plan their careers accordingly.
What this means from a practical point of view is that permanent career management is here to stay. Just as companies need to be investing to discover the next wave of advantage, individuals need to be investing to maintain their skills, stay relevant, and have compelling stories of accomplishment to market their value to others.
If you think of yourself as permanently looking for the next job, and prepare accordingly, you are much less likely to be caught by surprise without having done the appropriate amount of homework.
So where do you start considering your own career in light of transient advantage? Let's start with a diagnosis. Consider the following statements:
If my current employer let me go, it would be relatively easy to find a similar role in another organization for equivalent compensation.
If I lost my job today, I am well prepared and know immediately what I would do next.
I've worked in some meaningful capacity (employment, consulting, volunteering, partnering) with at least five different organizations within the last two years.
I've learned a meaningful new skill that I didn't have before in the last two years, whether it is work related or not.
I've attended a course or training program within the last two years, either in person or virtually.
I could name, off the top of my head, at least ten people who would be good leads for new opportunities.
I actively engage with at least two professional or personal networks.
I have enough resources (savings or other) that I could take the time to retrain, work for a small salary, or volunteer in order to get access to a new opportunity.
I can make income from a variety of activities, not just my salary.
I am able to relocate or travel to find new opportunities.
If you answered "no" to any of the questions, that's an area of possible vulnerability and a place to consider addressing a weakness. If you answered "no" to five or more of the questions, it's time for immediate action! Like it or not, the transient-advantage economy is here with us now and shows no sign of retreat. My hope is that you will be inspired and excited to figure out how to thrive in this new landscape.