Seems like a stupid question, doesn’t it? After all, Warren Buffett once said that competitive advantage was the most important investment criteria.
But Vistage Speaker and Competitive Advantage Expert Jaynie Smith says “No, under certain circumstances. Thousands, if not millions, of look-alike companies are making decent returns, with some even experiencing impressive growth. Various factors contribute to their success. Sometimes supply and demand favors them, sometimes they benefit from lousy competition, and sometimes it is simple geography. At times a competitive advantage is not needed if one is selling the right product at the right time in the right market. However, these scenarios rarely last for extended periods.”
If things are going well in your business, but it looks like everyone else, you may be succeeding in spite of what you’re doing, not BECAUSE of it. Ms. Smith’s blog post Do You Really Need a Competitive Advantage? Will help you decide.
Note: Her short but compelling book “Creating Competitive Advantage” is a must read if your answer to the above question is “Yes.” It will help you discover if you truly have a competitive advantage (many CEOs often confuse this with a “strength”; they are not the same thing)….or help you get one.
