Transient Advantage

Facilitated by
Dr. Evie Wibowo Iman

Strategy is Stuck
For too long the business world has been
obsessed with the notion of building sustainable
competitive advantage.
Obviously, its marvelous/exceptional to compete
in a way that others cant imitate (GE, IKEA,
Unilever).
But its now rare for a company to maintain a
truly lasting advantage (the forces at work; the
digital revolution, fewer barriers to entry,
globalization etc).
To stay ahead, they need to constantly start new
strategic initiatives, building and exploiting many
transient competitive advantage at once.
Sustainable competitive advantage is now the
exception, not a rule. Transient advantage is the

Idea in Brief
The dominant idea in the field of
strategy- that success consists of
establishing a unique competitive
position, sustained for long periods of
time- is no longer relevant for most
businesses.
They need to embrace the notion of
transient advantage instead, learning
to launch new strategic initiatives
again and again.

The Wave of Transient Advantage

Returns

Exploitation

Launch

Ramp Up

Reconfigurate

Disengage

The Wave of Transient

Advantage

Launch
In which the organization identifies an opportunity and
mobilizes resources to capitalize on it.
Ramp up
This period calls for people who can assemble the right
resources at the right time with the right quality and
deliver ton the promise of the idea.
Exploitation
In which it captures profits and share, and forces the
competitors to react.
Reconfigure
The firm has to reconfigure what its doing to keep the
advantage fresh. (Often the very success of the
initiatives generates competition, weakening the
advantage.)
Disengagement
The advantage is completely eroded. (IBM. Sony, Nokia,
Kodak etc)

TEMPORARY ADVANTAGE

Returns from a Series

of Replicable Actions

Organization has already

moved to next advantage
Exploitation
Launch

Counterattack

2
Time

Seven Dangerous
Misconceptions
1. The first - mover trap (in most industries a first mover
advantage doesnt last)
2. The superiority trap (many companies dont see the need
to invest in improving their established offerings)
3. The quality trap (when a cheaper, simpler offer is good
enough, customers will abandon the incumbents)
4. The hostage-resources trap ( have no incentive to shift
resources to new ventures)
5. The white-space trap (when opportunities dont fit their
structure, firms often simply forgo them instead of
making the effort to reorganize)
6. The empire building trap (bureaucracy building; it
prevents experiments; it causes employees who like new
things to leave)
7. The sporadic-innovation trap (innovation is an on-again,
off-again)

Strategy for Transient Advantage

The New Play Book
1. Think about arenas, not industries (an arena is
combination of a customer segment, an offer and a
place in which that offer is delivered)
2. Set broad themes, and let people experiment (to try
different business models)
3. Adopt metrics that support entrepreneurial
(conventional metrics can effectively kill off innovations;
try new things))
4. Focus on experiences and solutions to problem
5. Build strong relationships and networks
6. Avoid brutal restructuring; learn healthy disengagement.
(to continually adjust and re adjust its resources)
7. Get systematic about early-stage innovation (to have a
governance structure suitable for innovation)
8. Experiment and learn.

Leadership as
Orchestration
A great leader do is work out some key
directional guidelines, put in a place
good processes for core activities such
as innovation.
A strong leader seeks contrasting
opinions and honest disagreement.
A transient advantage leaders recognize
the need for speed.

THANK YOU

Elements of a Companys
Business Strategy