Dynamic Advantage Competing for the future today
Approximately eighty per cent of the value of most listed firms is driven by expectations of their future earning stream. Yet past and current period results are decreasingly relevant as indicators of future performance as the speed of change in business, technology, competitors and markets increases. For many companies instability is the new norm, agility and preparing for the future changes are essential capabilities.
Firm leaders need to make a strategic choice of the degree to which they orientate the firm towards the future rather than relying on projecting from the past and invest in key enabling capabilities. Investors should monitor the strength and performance of these capabilities as the research findings indicate a strong correlation with the firm's ability to out-perform competitors.
"Dynamic Advantage is an integrated model that defines how a corporation can increase its ability to out-perform competitors as the future unfolds. It is essential thinking for any executive aiming to secure the future of their corporation."
The research is clear, the firms that consistently outperform their competitors in unstable markets have adopted a forward leaning orientation and nurture and leverage a set of mechanisms that enable them to prepare for and win in the unfolding future. Attending to the mechanisms underpinning the three capabilities (Sense, Seize, reShape) will enhance the Dynamic Capacity of the firm. The level of Dynamic Capacity of the firm is a good indicator of the ability of the firm to outperform competitors as the future unfolds, which itself is a primary driver of the value of the corporation.
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"Dynamic Advantage – addresses an age old strategy issue; how can the firm most effective compete in the present – while at the same time investing in resources and capabilities to catch the next wave of competitive advantage. It is foundational thinking – along with a practical set of easy to use tools – that will certainly shape the evolution of the field of strategy."
Professor Bernie Jaworski Dean & Peter F. Drucker Chair of Management, Peter F. Drucker School of Management, University of Southern California