Freedom from Futility: Pareto
- 80% of the consequences flow from 20% of the causes
- 80% of the results come from 20% of the effort and time
- 80% of the company profits come from 20% of the products & customers
- 80% of all stock market gains are realised by 20% of the investors and 20% of an individual portfolio, Sometimes is is 90/10 or even 99/1. The minimum ratio to see is 80/20
What are your 80/20 rules:
- Who are the 20% of customers causing 80% of the problems
- Which 20% of advertising is delivering 80% of the results
- Which 20% of partners and affiliates are enabling 80% of the profits
Focus by doing the bare essentials: Parkinson's Law
Parkinsons Law dictates that a task will swell in perceived importance and complexity in relation to the time allotted for its completion.
- Limit tasks to the important
- Shorten work time to limit tasks to the important
- Eliminate with ruthlessness
Getting into the mindset:
- If you had a heart attack and could only work 2 hours per day...what would you do?
- If you had another heart attack and could only work 2 hours per week...what would you do?
- What are the top 3 activities I use to fill my time to feel as though I have been productive?
- If this is the only thing I accomplish today will I be satisfied with my day?
- On a macro and weekly level leave work at 4pm and take Monday and Friday off. This will force you to prioritize and develop your life outside of work.
- On a micro task level limit the number of items on your to do list and use impossibly short deadlines to force immediate action and ignore minutiae.
Applying Barney's (1991) VRIN framework can determine if a resource is a source of sustainable competitive advantage. To serve as a basis for sustainable competitive advantage, resources must be --
- Valuable-- meaning that they must be a source of greater value, in terms of relative costs and benefits, than similar resources in competing firms
- Rare-- rareness implies that the resource must be rare in the sense that it is scarce relative to demand for its use or what it produces
- Inimitable-- it is difficult to imitate
- Non-Substitutable-- other different types of resources cannot be functional substitutes
The criteria of the VRIN Framework clearly rules out best practices as a source of competitive advantage. If other firms can easily understand and copy a capability, it is not a source of advantage.
Top 10 Strategic Risks
- Product Development and Innovation Consumer Demand Shifts
- Marketing and Branding
- Cutting Edge Technology
- Pricing Pressures and Input Price Risks
- Supply Chain Risks
- Managing Sourcing Strategies Strategic Alliances and Transactions
- Shifting Legal and Regulatory
- Threats Emerging Markets Strategies
RBV - A resource based view. Hooley et al., suggest the following classification of competitive positions:
- Price positioning
- Quality positioning
- Innovation positioning
- Service positioning
- Benefit positioning
- Tailored positioning (one-to-one marketing)