Today I was thinking of what competitive advantage really means and came up with a few categories or methods of gaining competitive advantage. I think it is well worth looking at how you stack up against each category periodically (anything missing?).
Capability
Essentially you have something or can do something that is significantly better than your competitors. Even better if you are the only one or there is a barrier to entry.
Speed
How quick can you deliver on your promise and how fast can you respond to change.
Knowledge
What do you know that your competition doesn't. Knowing your customer fits here and so does intellectual property.
Location
Location, location, location. These days location means that your customers can find you and reach you when they want to buy whether that is in the real world or virtual world.
People
If you have great people and can prove it, you gain competitive advantage. You then need a way to attract and retain those people.
Cost
Efficiencies and outright cost reductions. Lowest price generally wins for comparable products, but not always… see reputation.
Reputation
People will pay more for the safe brand they know. Build your reputation and guard it.
