As the Olympics and Paralympics bring a summer of memorable sporting endeavours to a close, we felt one last sporting metaphor would not go amiss. Throughout this summer’s games, we have witnessed the desire of sportsmen and sportswomen to outperform their rivals. This aspiration rings as true for CEOs and their businesses as they too look to outclass and do better than their competitors. However, with benchmarking, companies risk merely ‘going for bronze’ and accepting inferior levels of performance to those their organisation and their people are actually capable of achieving.
In the words of Michael Porter, the leading authority on company strategy, a company wins when its strategy is based on the ability to do the same processes as its competitors differently or to pursue entirely different processes and practices. Long term success requires businesses to differentiate themselves, to find an edge that distinguishes them from the field −and once they have found this edge, to do everything in their powers to maintain the invaluable distance put between them and their closest rivals.
Preserving this distance requires amongst other things
- a deep rooted understanding of the market
- the ability to listen to what customers are saying
- unrivalled leadership
- and crucially the ability to execute with discipline to achieve pre-defined business plan targets.
In Alexander Proudfoot’s view, there is one further requirement that helps distinguish the best in class from the rest of the field, and that is what we have in previous articles referred to as ‘the execution gap’ − the gulf that often exists between a company’s best demonstrated performance and the level at which the company could be operating. By closing this gap, companies boost their chances of finding and maintaining that all important edge.
Executives Mike Critelli, Hank McKinnell, Bob Lutz, Michael Miles, Prof Manfred Maus, Allen Morgan, Bernard Atalli, Alexandre Silva, Alfredo Ovalle and Howard Atkins all provide valuable insight based upon their personal experiences. Their conclusion; benchmarking has a role to play but becoming ‘as good as’ does not differentiate a company. Companies cannot afford to settle for simply operating at the same level as their competitors nor should they ignore the ‘execution gap’. An effective and top-performing CEO, as with his or her sporting counterparts needs to ‘go for gold’ and not accept any place but first. And how? By instilling a culture of excellence and pushing their people to achieve the next level of performance.