Note: This article is updated at What are the Key to Winning in Any Economy?
I'm lucky to have an interview with Irv Rothman, CEO of HP Financial Services.
I’m always happy to learn from CEOs and I especially enjoy the way they look at the world. Edward de Bono has spent a lifetime teaching extraordinary executive thinking skills to ordinary people, and I’m a big believer in learning business skills for life.
Irv wrote a book called Out-Executing the Competition, where we he shares leadership lessons he's learned about surviving and thriving in any economy.
I asked Irv a handful of questions, some about work, some about life.
The most important question I asked him was what’s the most surprising insight you’ve learned about out-executing the competition. Here’s what Irv said:
“That it is not price. The creation of and execution on a genuine value proposition is the true source of sustainable competitive advantage and the best chance of retaining a customer for life…which should be an imperative.”
I think Irv’s right, and that makes perfect sense to me.
I’m a believer in customer-connected engineering. Your customer is a strategic decision. Once you know your customer, you need to know the pains, needs, and desired outcomes. If you have empathy for the pains and needs, and if you know what good looks like, then you have a great shot at taking the lead.
Then it comes down to your ability to execute.
The surprise here is that in order to execute well, you need to innovate in your processes, or you’ll be pushed out to market (too expensive, too slow, too irrelevant.)
The other surprise is how difficult it can be to truly generate new business value. As I’ve said before, business value generation is the new bottleneck. It takes a lot of customer insight, empathy, market awareness, innovation, and agility to know how to generate new business value on a consistent basis. In fact, this is where innovation and agility are crucial. You need an execution capability that supports exploration and new business development.
On a good note, the basics are timeless. As Peter Drucker taught us, "The purpose of business is to create a customer." So if you can get clarity on who you want to serve, figure out a profitable niche of the market where you can compete by playing to your strengths, capture the value in an elegant way, and master generating new value, then you are ahead of the game.
If you can do these well, then you, too can be the Jedi Knight of strategy, out-execute the competition, and get the compound effect from spending the right time, on the right things, the right way, with the right energy.
That is the challenge.