4.6.4 Wide-Open Conditions

Six keys to understanding the issues related to an absence of barriers.

Art of War Quote: 

"You can attack from some positions easily.
Other forces can meet you easily as well.
We call these unobstructed positions.
These positions are open."

Sun Tzu's The Art of War 10:1:7-11

Perspective: 

"Where there is an open mind there will always be a frontier."  Charles F. Kettering

General Principle: 

Establish wide-open positions quickly and make them visible.

Situation: 

It is a mistake to think that the best opportunities are those that have the fewest possible barriers to entry. While obstacles make taking advantage of a specific opportunity difficult, the absence of barriers creates an opposite problem where taking advantage of an opportunity is too easy, not only for us but for everyone. Areas without barriers are highly competitive environments where it is difficult to find any competitive advantage unless we understand our situation.

Opportunity: 

Opportunity exists as openings (3.1.4 Openings). This logic suggests that the most open situations would provide the most opportunities. However, wide-open positions are one of the many non-intuitive situations in strategy that require the reverse of our normal perspective (3.2.5 Dynamic Reversal). To help us analyze the potential opportunities, we use the benchmark called wide-open positions to help us understand the issues related to positions that have no barriers to entry (4.6 Six Benchmarks). 

Key Methods: 

The following keys define the nature of wide-open positions and how we must handle these opportunities.

  1. Wide-open positions are the benchmark for the positions with no barriers to entry. There are no real obstacles, physical or intellectual, preventing us or anyone else from getting into these positions. These opportunities are like fragile bubbles, protected only because people do not see them (3.2.2 Opportunity Invisibility).
  2. The more open the position, the less costly it is to pursue. Barriers require an investment. Depending on the type of barrier, that investment can take the form of effort, time, or other strategic resources. These costs represent the initial commitment required to explore an opportunity. The less available the resources required, the less the probability that a given position being initially profitable (3.1.2 Strategic Profitability).
  3. Winning a wide-open position requires quick, direct action. Since these opportunities have no barriers, they do not require long campaigns. The main purpose of campaigns is surmounting barriers. These positions must be established quickly, without going through a series of steps (5.3.1 Speed and Quickness).
  4. We must avoid conflict in pursuing wide-open positions. As we know, conflict is always expensive. The threat of new competition tends to depress the value of this position both initially and over the longer term. Low-barrier opportunities are high-probability opportunities but they are usually low-profitability opportunities.(3.1.3 Conflict Cost).
  5. We must maintain the supporters and resources we win to produce profits from these positions. As non-intuitive as it sounds, the secret to using opportunities in wide-open areas is not better competitive skills but better production skills. Maintaining existing supporters of our position is less costly than winning new supporters so we must offer as much value as we can for as little cost. More efficient forms of internal operation can make these inherently marginal positions profitable enough to justify holding them, at least for a time (1.9 Competition and Production).
  6. While hard to defend, wide-open positions make good stepping stones. While the lack of barriers increases the likelihood of winning a position, they raise the costs of defending a position over time. Since there are no barriers to entry, any success we find simply attracts more competitors, decreasing the relative value of our effort by increasing our competition. Often, the main value of wide-open positions is in using them as a stepping stone to a new, less open position (3.1.2 Strategic Profitability).
  7. After winning a wide-open position, we can create barriers with visibility. Wide-open positions have great visibility and lend themselves to self-promotion. We establish a position in these areas, we can create recognition for our position. Since mind space is limited even when an opportunity is wide-open, our recognition can create a more dominating position (8.3 Securing Rewards).

Illustration: 

Any business that requires little training and no real capital investment defines a wide open position. So do relationships that lack any kind of commitment or investment. For our illustration, let us think about a window-washing business.

  1. Wide-open positions are the benchmark for the positions with no barriers to entry. Anyone can start a business washing windows of businesses and homes.
  2. The more open the position, the less costly it is to pursue. Window washing requires no investment in learning, skill development, or equipment.
  3. Winning a wide-open position requires quick, direct action. Since lots of people would like their windows washed at a reasonable price, all we need to do is get out there and talk to them.
  4. We must avoid conflict in pursuing wide-open positions. We cannot try to win away the customers of other window washers. 
  5. We must maintain the supporters and resources we win to produce profits from these positions. We must keep all existing customers, contacting them regularly to see if they need their windows cleaned again. We must get more efficient over time at both finding new customers and cleaning windows.
  6. While hard to defend, wide-open positions make good stepping stones. We must look for opportunities to expand our business, into carpet cleaning or other forms of maintenance for existing customers
  7. After winning a wide-open position, we can create barriers with visibility. If we get well known for providing good service, we can maintain our business.

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