You may underestimate yourself in some areas and overestimate in others. Success comes from knowing what you do well and where you need help.
To do this, reflect on your life experiences:
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What inspires and excites you?
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What drains you or frustrates you?
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What hobbies or jobs have brought you real joy?
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Who do you admire and why?
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What moments have made you most proud?
This reflection will help you align your strengths with your business idea.
Wherever there are gaps, that’s where you bring in support, training, or partnerships.
Your capabilities are unique to you. They reflect the way you approach problems and challenges. These are intangible things that you may not be able to explain.
You start with the resources that are available to the business. This starts with you but also includes things you can buy, rent, borrow and even gifts. These resources are just things you can buy and sell – in themselves they add no value to the business.
How you combine and utilise these resources is how you create capabilities within the organisation.
Here’s a simple example:
You purchase a hotel building in the West End of London (a prestigious location) for £50 million.
At this stage the hotel has no value (except for potential of increases in property values), indeed it is a cost to the business – security, insurance, maintenance, cost of capital etc.
The building and restaurant is refurbished to 5 star standards – again no actual benefit just costs.
You employ experienced staff for all the main functions – front of house, house keeping, chefs, restaurant staff, admin etc.
Still no real value – just costs.
You open and start to generate income.
But you are just the same as every other 5 star hotel in terms of the resources – everyone has the same equipment and you have recruited from a pool of labour available to all your competitors.
How do you become “special” and generate a genuine competitive advantage in your market?
What does competitive advantage look like?
We’ve all experienced the “wow” factor in a restaurant or hotel – the basics such as the quality of food and accommodation are exceptional but there’s something else. Something intangible which makes you feel good, comfortable, welcomed – the list goes on.
Where does it come from?
There is no single or simple answer but it usually starts with leadership and the ability to communicate a vision throughout the organisation including all the key stakeholders. It’s not just top down or always obvious.
There is a clear link with the culture of the organisation – shared purpose, shared learning and knowledge and giving people the autonomy to apply the vision in their own way.
This culture also recognises that things go wrong but blame is not a solution – use mistakes as a learning process at all levels, particularly with senior management and leaders.