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STRATEGY


Business differentiation: Boosting competitiveness in the age of digital

While many big players have a differentiated value proposition, they often fail to gain competitive advantage.

Overview

In an environment where digital disruption creates new services (and whole new markets) overnight, today’s competitive battle cry is, “Differentiate or die.” Yet for large incumbent companies, differentiating is more difficult by the day.

Why? Because many companies are stuck in traditional operating modes; inextricably tied to their matrices, organized for the sake of the old rules and processes rather than leading with the changing needs of customers and innovating outside in. It’s no wonder start-ups drive disproportionate amounts of market disruption. It may be less about their innovation capability and more about their simpler structures, transparency and, hence, agility.

Infographic – Can you be big and differentiated?

Key Findings

The frenzy to disrupt, to differentiate is understandable in an environment where it’s increasingly harder to stand out. Part of the problem: a lack of visibility into what creates value and differentiation. To break out of this dynamic, companies need to transform the way they approach strategic change efforts. This starts with an understanding of what exactly creates value within an organization.

While most companies know what their customers want, many flounder when it comes to delivering it. Why? Let’s consider three main barriers:

  1. A lack of alignment and visibility into the true drivers of differentiation caused by an inability to break out of a functional management of operations – ultimately impeding outcomes.

  2. Minimal understanding of how effectively their resources, systems and investments create differentiation and value or destroy it.

  3. The inability to reward the individual behaviors that contribute to differentiation.

Recommendations

To truly differentiate, begin with three actions:

  1. Align your leadership by developing a blueprint for value creation starting with the outcome. What’s the outcome you’re driving toward and what business landscape does it operate within? How does it support your company’s differentiation in the marketplace?

  2. Capture the complexity in your organization. By that we mean adverse effects of expanding offering types, service types, customer segments and transactions that have been layered onto the organization over the years.

  3. Dare to question the status quo. An examination of value should start at the customer level and in terms of a business outcome.


Author

Mark George
Managing Director,
Accenture Strategy – Operations

Mark George is a Managing Director in Accenture Strategy and leads the global Operations and Process Transformation practice. Within the past ten years Mark has architected and supported enterprise transformation initiatives at more than 40 Fortune 1000 organizations from various industries, including Consumer Products, Automotive, Energy, Pharmaceuticals, Financial Services, Telecommunications, Technology, Resources and Medical Products.

Mark George is the book author of “The Lean Six Sigma Guide to Doing More with Less” (John Wiley & Sons Publishing, 2010); his work has also been published in Harvard Business Review. Mark holds US Patents in Lean analytics and Enterprise Speed. He resides in Dallas, TX.

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