However, before we get into the strategies for creating competitive advantage, it is essential that you have a basic understanding of how your natural gifts and talents set the stage for creating competitive advantage in the first place.
- Benefit. You may find it difficult to articulate your natural gifts and talents. That's OK in the beginning stages. But at the very least, you must be clear about the benefit your natural gifts and talents provide. What are some measurable outcomes that have resulted from people working with you? Why do people seek you out? This is not the time for modesty. You absolutely must know how your natural gifts and talents benefit others, particularly the people you're destined to serve. In my own case, for example, some of the results I have helped people to achieve include smoking cessation, academic advancement and self acceptance.
- Who Do You Serve. Who is your tribe? On one hand, you've got to know exactly who wants what you have to offer, and how you are uniquely qualified to make their life better. On the other hand, you have to know who you LOVE working with, and how the chemistry between you helps to create breakthrough experiences. It will help to think of your "model client", based upon your work with a particularly gratifying experience. You will know you got it right when it seems more like play than work. This is key to your ability to create demand, which is a key driver of you financial growth.
- Competition. Don't tell me you don't have any! Even if there aren't many people with similar skill sets or resources, your competition actually includes anything else your people could do to meet - or substitute - the need you can fulfill. Not only that, if you're even just a little good at what you do, there are people who covet your position and will pounce on the first opportunity to either take what you have or prevent you from enjoying it to the fullest extent. You absolutely need to know who those people are and understand their motivation. Don't be naive. Think it through and start drawing up a short list today!
The three determinants above are what set the stage for creating competitive advantage. What follows are Porter's three strategies for creating competitive advantage; cost leadership, differentiation and focus. When applied to creating competitive advantage for the individual, the strategies can be described as follows:
- Prosperity strategy: Prosperity, including intergenerational wealth, refers to your ability to earn the highest revenue from your work or investment. If you're able to earn more for less, you achieve competitive advantage over your competition. Generally speaking, keeping lower expenses will result in higher profits. If you are not making a large enough salary or return on your investments, you can cut costs by being more frugal. By lowering your expenses and raising your income, you can add value to your tribe by maintaining what we might call "controlled hunger".
- Innovation strategy: An innovation strategy is characterized by your ability to solve old problems in a unique way. Innovation is always balanced by your core values and natural gifts. This level of innovation is what I would call "freedom within a framework". Your challenge is to be creative without contradicting your mission. The ultimate objective of the innovation strategy is to increasingly improve your ability to deliver unique, high quality experiences to your tribe. Keep in mind that if your tribe members recognize the ways in which you're different from your competition, they will be more likely to invest more into what you're doing.
- Predomination strategy: The domination strategy requires you to concentrate on two areas of focus: On one hand, you target products and services where your tribe has predominant spending or interest patterns. My tribe is intellectual. I know they buy books. So I have authored six books and penned thousands of pages of online material. On the other hand, you focus on geographic locations wherein your tribe predominates numerically. By and large, my tribe lives in or around major cities. The predomination strategy enables me to focus on the needs of the tribe members and how my offerings can improve their daily practice.
To truly succeed, it’s not enough to simply match your competitors. Success comes to those who can deliver a superior product or service in a way that is different, meaningful and based on their tribe's needs and desires.