In a world where there are no secrets, where innovations are quickly imitated or become obsolete, the theory of competitive advantage may have had its day. Realistically, ask yourself, If all your competitors gave their strategic plans to each other, would it really make a difference?
In 1986, Amar Bhide wrote “Hustle as Strategy” for the Harvard Business Review. At the time, he was an assistant professor at HBS. He examined the dynamics within the financial services market. Why was Goldman Sachs earning so much in profits relative to its peers? It’s not a powerful new strategy that a new leader infuses into the organization. Instead, it’s about focus and hustle.
Opportunities to gain lasting advantage through blockbuster strategic moves are rare in any business. What mostly counts are vigor and nimbleness.
Finance, like many other industries, and many software segments, sells a commodity. What differentiates the best banks from the middle of the pack aren’t differentiated financial products or novel go-to-market strategies or new insights into the market. As soon as one innovates, another copies - potentially with a year or two.
The only way to make the vision real is through superior execution. That’s the key. It’s the resulting hustle that outlasts product cycles and wins against unremitting competition.
How did these businesses compete? First, they focused on handful of key metrics.
One manager, responsible for a remarkable turnaround in American banking, attributes much of his success to “a very rigorous and steady management review process, which was one of the hardest things that was put in, and which was done right in the beginning. Every month we sit down with every division and review where we stand against goals”
Second, they hired for hustle and instituted great training programs that balanced operations with marketing. My partner Alex often shares the advice Marc Benioff gave him: “great businesses are formed at the Venn diagram intersection of a great product and equally great go to market.” In addition, the most senior people at the firms were responsible for recruiting.
In many SaaS categories as well as in venture capital, this idea is absolutely true. Great execution is a winning strategy. And that starts with a focus on metrics and hiring the right people.