Article PDF: 1.7 Competitive Power

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Five rules describing the key sources of superiority in strategic positions.

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This article examines the question of how do we determine how one strategic position is better than another in terms of these five key elements. How do we predict which strategic position will triumph over another? People expected larger organizations to be successful. We also expected organizations that had been successful in the past to continue to be successful in the future. We also expect the volume of resources used to matter.

The problem is that, without knowing the right rules, these expectations are often wrong. Size and past success have nothing to do with fulfilling the current mission. Size is not power. Past success on not momentum. What do power and momentum really come from? In observing what happens in the real world, smaller forces often triumph over larger ones. Newer organizations often overcome established ones. Vast resources are often misspent in failed endeavors. This meant that something deeper was going on, something that wasn't obvious.