Sustaining Differentiation

The preferred competitive approach by most of the organizations seems to be in form of having differentiation, especially, if the volumes are missing. Which is good, and it further gets refined by having a “focused” differentiation, as suggested by Porter. This text book approach is good, and organizations have succeeded by following these approaches. So, there is no question on the relevancy of these even today. The question is, how do they sustain the differentiation, as in today’s dynamic and fats paced world, and differentiation, or edge is short lived.

Another point to be noted is, we are having so many startups in e-commerce space, such that it is becoming difficult to keep track of many of those. It is true that strategy depends on attractiveness of the market, but it also depends on the organizations strengths. With so many players, established, and new entrants, with cut throat competition, how does one create brand awareness / recognition, and differentiation to get market share from existing players, or sustain the market share that someone already enjoys?

In knowledge industry, it is given that the biggest asset of an organization is human capital. The question is how to sustain that advantage and at the same time also enhance it further. In IT industry, firms have created this advantage by making those predictable through standardization of processes. Yet, the capabilities of two organizations is not same. Why is it so that every organization, following CMMi or any other quality methodology, even after being assessed at the same level, end up with different capabilities? It is obvious that there is some gap somewhere.

The way I see it, people define processes with a mindset of perfection. That is, if someone follows that process, it is ensured that resultant outcome / product is not flawed. This invariably results in extensive checks and balances to minimize on exceptions. The intent is good; however, in order to minimize on exceptions, invariably some exceptions get considered as norms, resulting in overload on the system.

For example, in process centric software development system, we will have, checklists to define standards and guidelines, processes pertaining to buddy reviews / test, technical quality assurance reviews / test, development lead reviews / tests, and then battery of other reviews and tests. The point is, every review and test cycle will ideally result in more conformed product; however, it has an associated cost of identification and rework, not to mention the time required to do those costly checks, and rework.

If we were to create a differentiation, we need to think in terms of not creating a “muda”. It will be good to have the resources, capable to construct is right the first time itself. That is, resources having the required skills, and knowledge, understand the standards and guidelines and other code metrics that will be expected at the time of completion, unit test those at their level, ensure those pass through integration points, and once checked-in, ensure compliance from ‘Definition of Done’ perspective. This will ensure, minimal defects, if any, and hence, less cost owing to rework and extensive external reviews and tests.

However, that is only one part of the entire lifecycle. For an IT services company, the touch point starts from pre-sales and may go beyond deployment to maintenance and support. Though, preparation even priori to first touch point, goes back even much earlier. That is, preparation in terms of capability, capacity, portfolio of solutions, offerings etc. All this adds up for differentiation, and must be evaluated and addressed.

In fact, all of this has to happen continuously, on a periodic, as well as on event basis. That is, systematically, drawing out the Capabilities, Processes and Value Streams for an organization, such that all new advancements either in tool, technology or resources capabilities are incorporated to sustain and further sharpen the differentiation. The point is, it can’t be one-time activity, and requires recalibration, to adjust to environment around us. We live in a dynamic world, and so should our internal measures, i.e. instead of those being static, aloof from current realty, make use of advancements for our own benefits. Needless to say the standalone views of capabilities, processes or value streams will not shed more insights, rather cross cutting views will reveal more insights, on bottlenecks as well as opportunities.

The conflict between intent and doing arises, when we stop thinking of improvement, and get satisfied with current state. So, from an IT services company’s perspective, we need to systematically identify the challenges from pre-sales through support. The challenges identification should not confine to internal inefficiencies, rather should also include change in market attractiveness, our own strengths, including environmental scan various market forces.

Of course, one person, or function can’t achieve all of it. Instead, it should be a combined effort, and should get sponsored and governed at corporate level. In addition, all of this will not yield the desired results, if the workforce does not have the buy-in, and do not possess the required capability. Process can help you in providing the prediction, but can hold you away from innovation (because of hierarchies). Tools can help you reduce the time, or being more compliant to the desired outcome; however, may require additional investment in procurement, and readiness etc. The point, is there is no straight path or processes to achieve it, rather it has to traverse through intervened analysis, implementations and feedback.