This one should be pretty quick. It’s building on the previous blog post about what a good strategy is, which is leveraging an organization’s sustainable competitive advantage to create value better than others. So what are our sustainable competitive advantages? Let’s first break down the word sustainable:
Sustainable means that it’s a long lasting advantage and isn’t easily lost. Apple’s iPhone technology package was revolutionary, but wasn’t a sustainable advantage. Samsung caught up pretty quickly. Modern datacenters use up a lot of space and energy. Hence, datacenters in areas with cheap real estate and hydroelectric (cheap) power have a distinct advantage.
Competitive means that there is an inherent comparison to another organization. Who do we compete with? For the sake of this article, I am going to ignore who we compete against – it’s very unclear and at the end of the day it doesn’t matter – we want to be the best we can be.
I think our two biggest advantages are:
1) Our people’s intrinsic motivation
2) Heavy Rules-based culture
I created a survey a couple years back testing whether people try hard or do not. I was surprised by the results in that, on a blog that was designed to attract people complaining about the VP Navy, most of the participants stated that they try very hard despite the numerous incentives not to. For-Profit Corporations would kill to have that kind of dedication.
People follow Navy instructions very closely. This is good and bad. The bad thing is that it doesn’t allow for much innovation outside those instructions. It can also teach people to be unable to make decisions without instructions to tell them how to think. The good thing about it is that you can make a change instantaneously with a word document and a signature.
My recommendation is the implement some instructions that govern innovation, incentives and rewards, role placement, process improvement, and change management. Any skipper can, overnight, create an innovation cell to do all of these things, and I know there would be dozens of people that would love to be part of that effort. The bottom line: use the rules-based culture to frequently make incremental improvements.