Value-Creating Changes

...increasing value requires a strategy for process on at least one of four different fronts:

Many strategy experts have equated competitive advantage with high profitability.  Despite all the emphasis on "competitive advantage" in the world of business strategy, you cannot expect to make money--to get wealthier--by simply having, owning, buying, or selling a competitive advantages. 

The truth is that the connection between competitive advantage and wealth is dynamic.  that is, wealth increases when competitive advantage increases or when the demand for the resources underlying it increases.   In particular, increasing value requires a strategy for process on at least one of four different fronts:

• deepening advantages,
• broadening the extent of advantages, 
• creating higher demand for advantaged products or services, or
• strengthening the isolating mechanisms that block easy replication and imitation by competitors.

ACTION POINT: Understand the four fronts for applying strategy to increase your value.