What are the characteristics of strategic resources? Having strategic resources ensures that your organization will stay competitive for the long term. How do you know what makes these resources strategic?
There are 5 characteristics that I want to share with you.
There’s a reason I used a picture of the F-15 Eagle. The F-15 was first flown in 1972. It’s responsible for over 100 air to air kills with not one single Eagle lost. It’s dominance is unparalleled and is credited with American air superiority for over 40 years.
Strategic Resources? Nothing like the F-15 Eagle
It may not be what you have in mind when thinking of characteristics of strategic resources, but it is! Don’t think of strategic resources only as large endowments, a franchise player, or proprietary software.
This book by John Maxwell, The 21 Indispensable Qualities of a Leader is the quintessential book of leadership. I highly recommend it and in it he talks in depth about what gives a person strategic advantage. Note, this is an Amazon affiliate link and if you buy it, I will receive a small commission at no extra cost to you. Click on the image to see it in Amazon.
A strategic resource is only a strategic resource if it fits all five of these characteristics.
1. It’s hard to copy
Uniqueness is at the heart of value creation because it limits competition. If you have a resource that can’t be copied or can’t easily copied, then it’s going to give you an advantage over your competitors. This advantage is sustainable until your competitors can copy it, if ever. That’s what makes it a strategic resource. Think of everything Apple has accomplished over the last 10 years or so, iPhones, iPads, Macbook Pros, etc. There are plenty of touchscreen phones and tablets, still, none have the responsiveness and intuitiveness that Apple has managed to engineer. From another point of view, processes and programs can be copied but people can’t. If you manage to get great people on your team, or make those people great, it can be impossible to copy and ends up being a strategic resource.
2. It depreciates slowly
How long does it last? The longer your resource lasts, the more strategic it is. The F-15 has been around since 1972. I’d say we got our money’s worth. When thinking of your people, do they stick around? If you count your people as one of your strategic resources, but you keep losing them, you’re seriously just losing overall. Keep them around and make them High Performance, and watch your strategic advantage stay up.
3. Your organization controls its value
The organization doesn’t always control it’s resources. If your employees leave and give away your resources, those resources are not strategic. This is a common occurrence in high technology fields and also in organizations with donors.
I know of a nonprofit abroad who had an admin person quit, and this individual took the entire contact list with them to their next job. These are fields in which the main resource is knowledge. When that’s the case, the resource to be taken care of is not the blueprints, it’s the individuals who created and currently guards the blueprints.
4. It can’t be easily substituted
We don’t have Coke, will Pepsi do? For most people, sure. Some things are easily substituted, some are not. Pizza is easily substituted. Chicago style pizza is not. It doesn’t matter if there are hundreds of pizzerias in your town, there may only be a handful with Chicago style pizza. These are strategic resources that can’t be easily substituted.
It goes further than that. Your organization’s facilities, your staff, your leadership, none of it is easily substituted. Most employees won’t leave your organization on a whim, they leave because they find something they believe is better for them or they leave because they believe something is wrong.
5. It’s more effective than competitors’ similar resources
Are your resources more effective than your competitors’ resources? If you’re an organization, then your greatest resource is your people. Are your people more effective than your competitors’ people? You may be able to hire a great project manager or a great developer, but competent people alone don’t make up the company. You must build a great team with a great culture from the ground up.
Start 2018 off STRATEGIC
January 2018 we’re launching an email course that will walk you through first 15 days of the year and put you in a position to strategically lead teams.