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Advice from Perth-based Business Advisors about Developing a Sustainable Competitive Advantage
Many business owners, CFOs, financial controllers and managers know the goal is to run a business with a sustainable, profitable competitive advantage. However, it’s common to feel overwhelmed by day-to-day challenges and lose sight of the bigger picture—people, culture and purpose.
At Munro’s, our team of experienced business accountants and advisors based in Perth and servicing clients across Australia understand the factors that drive long-term success and know how to support you through the challenges of growth. They appreciate that you need to balance short-term pressures with the need to develop a strategic plan that drives sustainable growth, and most importantly, actually get it implemented.
When you’re ready to talk about what we could do for you, please book a meeting or send an enquiry.
What’s Required to Develop an Advantage for Long-Term Success?
It’s all linked to your:
- People;
- Culture; and
- Purpose.
Read Key Points & Transcript
Build a Sustainable Competitive Advantage
video key points
- Sustainable competitive advantage in business fundamentally relies on people, the only asset truly unique and non-replicable.
- Effectively addressing Purpose, Culture, and Talent significantly impacts your ability to shape this advantage, underscoring the transformative power of leadership on organisational outcomes.
- Viewing change not as a universally resisted force but as a sought-after state for improvement encourages a reevaluation of strategies towards achieving sustainable competitive advantage.
- Adopting an immediate and proactive approach to change, without waiting to be ‘change ready,’ presents a more effective pathway to fostering a competitive edge.
- For further guidance on building a sustainable competitive advantage, engaging with additional resources and support is recommended to navigate the complexities of change successfully.
Presented by: Drew Pflaum
References page.
video transcript
Lenna Nair, former CHRO of Unilever, once said:
“people is the only sustainable competitive edge that a business has because everything else can be matched”.
She is spot on.
Your people make or break your business. They are a key to how you build your sustainable competitive advantage. And the good news is, you have a huge influence on the outcome.
Your influence is linked to how you address such problems as Purpose, Culture and Talent within your business.
We dive into each of these problems in the other videos on the Sustainable Competitive Advantage page. But rather than address them in this video, let’s briefly talk about change, because building your sustainable competitive advantage is going to require change.
Change is something commonly viewed in a negative light. If I asked you how will people react to change, you’d probably say: ‘with resistance’.
What I want you to think about is – do people really hate change?
I don’t think so.
People, just like businesses, are commonly thriving to change. They want to be the best versions they can be. It’s the change process they find challenging.
This is an important distinction. It should help you think a little differently about change, and how you can go about changing things to build your sustainable competitive advantage.
A common way of thinking when it comes to change is that you need to be change ready when changing. You need “buy-in”. This is a concept which makes sense on the surface. However, we propose that there’s a better way.
Never wait to be change ready, because you risk never being ready. Instead, to build your sustainable competitive advantage, get started on change immediately and at the same time get started on being change ready.
This subtly different approach could be your key to change success.
Now, how that works in practice is beyond the scope of this video. So, before ending this video, I want you to know we’re not talking about some radical process that magically makes change easy.
The fact is, the whole change process is seldom easy. Otherwise you and your competitors would have already done it. Rather, I’m saying there is a way to go about change which increases your odds of success and that’s the one we’d love for you to follow.
So, please go ahead and watch the other videos about how to build a sustainable competitive advantage.
Afterwards, when you’re ready, let’s catch up and see how we can help you achieve change success.
Purpose Problem
You’re Chasing Growth in the Wrong Areas
Without a clear and distinct purpose, which both motivates employees and delivers value to customers, businesses can find themselves competing on price, being less productive, and uncertain about where, and how, to seek growth.
Solution
Be clear about your purpose.
Outcome
Superior strategy development.
Read Key Points & Transcript
Purpose for a Sustainable Competitive Advantage
video key points
- Addressing the Purpose Problem is crucial for building a sustainable competitive advantage, focusing on why your business exists and the specific pain it resolves for customers.
- A clear and distinct purpose is essential to attract customers beyond price considerations and to recruit and retain motivated, productive employees.
- Purpose serves as the foundational element of your business operations, guiding leadership, strategy, culture, organisational structure, customer service and talent development.
- Excelling in the six key areas identified by reputable science can lead to significant outcomes, including a 15x greater Total Return to Owners over 10 years, with addressing the Purpose problem being paramount.
- For further insights and research references, visit Munro’s Business Academy and explore the Reference page.
Presented by: Drew Pflaum
video transcript
When attempting to build your sustainable competitive advantage you must address the Purpose Problem.
- Why does your business exist?
- What pain are you resolving for customers?
Your answer to this must be clear and distinct. For if it is not, you’ll struggle to:
- Convince customers to buy from you outside the realm of price alone; and
- Attract and retain motivated and productive employees.
Purpose is the foundation of what it is your business does and the direction you need it to go.
If you’ve already explored a bit of our website, in particular the Experience Success page, you would have already heard us talk about the six key areas of business, which reputable science has shown to produce such results as 15x greater Total Return to Owners over 10 years.
To excel at the six key areas, addressing the Purpose problem is paramount.
Purpose defines leadership’s core agenda. It leads into strategy and helps you set the stage for your culture. Following on, it leads into your organisation’s structure, customer service and talent building. All six of the areas you need to excel at, according to the science.
The challenge, not set by us, but by the simple fact that you’re in business is:
Do you, and your people, all understand the purpose of your business?
In that video you just watched, we mentioned some research.
If you’d like the references, simply head on in to the Munro’s Business Academy and you can find them on the Reference page.
Culture Problem
You’re Not Performing to Your Best.
Culture is one of those things in business that many just let happen. As a consequence, a competitive disadvantage may accrue wherein there is lower staff productivity, lower employee retention and lower talent attraction.
Solution
Develop a high-trust, high-purpose, high-standards culture.
Outcome
Great employees stay, thrive and you attract more.
Read Key Points & Transcript
Culture for a Sustainable Competitive Advantage
video key points
- Culture, viewed as a second product, is vital for attracting and retaining top talent, necessitating uniqueness and continuous iteration, much like any product offered to customers.
- High-performing businesses are often underpinned by cultures that foster trust, purpose, and high standards, leading to enhanced organisational performance and employee well-being.
- Dysfunctional cultures can erode team morale and performance, whereas productive cultures inspire innovation, trust, and personal development.
- Zappos’ success illustrates the significant impact of a deliberate cultural strategy, driven by committed leadership, core values, customer focus, and aligned HR and management practices.
Presented by: Drew Pflaum
video transcript
Co-Founder of HubSpot, Brian Halligan, said in an article:
“I meet with lots of CEOs who want to pick my brain on the journey from starting to scaling HubSpot as its CEO”.
In that article, he said:
“Treat your culture as your second product”.
He expanded on this by saying:
“We have two products, one we sell to our customers (HubSpot’s CRM) and one we sell to our employees (HubSpot’s culture). Like your product, you need your culture to be unique relative to the competition (for talent) and you want your culture to be very valuable. Like your product, when it is unique and valuable, your company turns into a magnet that attracts and retains terrific talent. And like your product, it’s never done – it needs continued iteration”.
That’s powerful advice.
When we talk about culture, we’re talking about the environment in which your people work, and the influence it has on how they think, act and experience work.
The scientific research we’ve consumed on what type of cultures help produce high performing businesses, suggests developing a high trust, high purpose and high standard culture.
To quote some research:
“Our data show[s] that trust substantially boosts an organization’s performance, employee engagement, retention, and well-being.”
These are elements of your business which contribute to profit maximisation over the short, medium and long-term.
To quote some other research, we compare the outcomes of unwanted cultures and those you would desire.
Beginning quote:
“Dysfunctional cultures can develop stress, distrust, low morale, a lack of sense of ‘team’, a feeling that they aren’t … cared for, a lack of listening, [it can] minimise learning…”;
and we end that piece of the quote there as the list goes on and on.
Quoting another section of that research:
“A productive culture on the other hand inspires, helps to develop openness, builds trust, enhances performance, fosters developmental feedback, gets people to push themselves to be better and do better, boosts self-esteem, inspires a willingness to learn, flex, innovate and be genuine.”
We all no doubt want a productive culture, but:
Is it really that important and how do you get it?
To further the point about the importance of culture, let us take a brief moment to refer to research that looked into what led to the fantastic success of Zappos – an online shoe and clothing shop founded in 1999 and sold to Amazon ten years later for $1.2 billion.
The researched found that there were two key elements which produced Zappos success:
- Culture; and
- High performance teams.
So, how did they make their culture?
The research found five drivers that shaped the culture:
- Committed leaders
- Practiced core values
- Customer focused strategy
- HR practices aligned with the core values
- Management practices aligned with the core values
Essentially, the culture was not left up to chance. Employees were specifically trained for the culture and leaders led the way.
So, as you’re looking to improve your business and create a sustainable competitive advantage, do continue to keep in mind that committed work on shaping a high trust, high purpose and high standards culture can have a profound, leveraged and positive impact on your success.
We’ll end with these questions:
- Will you have the fortitude to make it happen?
- Do you know how to make it happen?
In that video you just watched, we mentioned some research.
If you’d like the references, simply head on in to the Munro’s Business Academy and you can find them on the Reference page.
Talent Problem
You’re Not Improving As Required
A clear purpose and high standards culture won’t achieve a sustainable competitive advantage unless all staff are given the best opportunities to continuously improve.
Solution
Effective training.
Outcome
Superior strategy execution.
Read Key Points & Transcript
Talent for a Sustainable Competitive Advantage
video key points
- Building talent internally is crucial for business success, offering a sustainable competitive advantage through attraction, retention, and performance enhancement of staff.
- A business’s purpose, alongside a culture of high trust and standards, significantly contributes to attracting and retaining talented individuals, motivating them to achieve their best.
- Implementing effective learning programmes enhances internal capabilities, driving innovation, customer retention, and productivity, as supported by scientific research.
- Research underscores the importance of nurturing human capital, highlighting its role in achieving superior sales, profit and customer satisfaction outcomes.
- You are encouraged to complete the spam-free diagnostic at the end of this page, sign up to Munro’s Business Academy and book a free initial meeting.
Presented by: Drew Pflaum
video transcript
Building talent from within your business is absolutely vital for success.
It’s tremendously difficult to find talented people from the outside and convince them to come onboard through recruitment. When you find them, they’re often expensive.
High performing businesses work out a way to both attract talent and cultivate it from within.
Having a clear purpose helps with both attraction and retention. A high trust and high standards culture does likewise, and it also motivates staff to perform to their best. Then having learning programmes, which effectively build the internal capabilities of your team, turns it all into a sustainable competitive advantage.
We don’t just say these things because we believe them to be true. We say them because it’s what science has shown us to be true.
There’s the research we mention on the Experience Success page, which found “Winner” businesses that built talent from within on average outperformed those that didn’t with 5x more Sales, 14x more Profit and 15x more Total Return to Owners over 10 years.
There’s also other research, such as one which examined the benefits of teaching employees corporate entrepreneurship and found it produced such benefits as:
- Promoting innovation and creativity;
- Higher returns on sales and more market share;
- Higher rates of customer retention; and
- Higher productivity and efficiency.
To quote that research and associated briefing:
“In the knowledge based economy, a company will succeed or fail because of the people it has. …., this is also not just bringing in the right people but in training them to be the kind of people the company needs to be competitive. The paper found, “human capital can be seen as a unique source of sustainable competitive advantage since efforts toward sustainability largely depend on the effective utilisation of human resources, leading to returns on sales, market shares, customer retention, efficiency and productivity.””
So, we’re presuming if you’re watching this you’re likely a business leader. If you’ve got this far, you get it. You know for your business to reach its potential and experience success you’ve got to address the Purpose, Culture and Talent problems we’ve mentioned on the Sustainable Competitive Advantage page.
We encourage you now to do one or all of the following:
- Complete the spam-free diagnostic below.
- Sign up to the free tier of the Munro’s Business Academy.
- Book a Get To Know Each Other meeting.
In that video you just watched, we mentioned some research.
If you’d like the references, simply head on in to the Munro’s Business Academy and you can find them on the Reference page.
Frequently Asked Questions for Sustainable Competitive Advantage
-
What does “competitive advantage” mean for my business?
It means having a sustainable edge over competitors that results in above-normal long-term growth and profitability. -
How can Munro’s help me develop a competitive advantage?
We begin by understanding your unique challenges and then create a tailored strategic plan. Our experienced business advisors work with you on leadership development, culture transformation and purpose alignment to drive real business improvements. -
What specific benefits can I expect from your advisory service?
You’ll gain improved decision-making, sustainable profitability, stronger leadership, enhanced employee engagement and transparent, reliable advice—all proven by our over 100 five-star Google reviews. -
Is this only for large companies?
Not at all. This approach is effective for small and medium businesses with $1million+ revenue growth potential. -
Are your services available outside Perth?
While Munro’s is proudly Perth-based, our accounting and business advisory services are available to businesses in WA and Australia-wide. -
What is the price for your services?
Our pricing is transparent and reflects the complexity of your needs. Please see our pricing page and contact us for a personalised quote. -
How do I get started with Munro’s?
It’s simple—book a free Get To Know Each Other meeting. We’ll discuss your business challenges and goals, and outline how our tailored solutions can help you achieve sustainable, profitable growth.
Where To Begin
Come Along To An Improve Session
First Session is FREE (incl. GST)
Upskilling Event for Business LeadersTop 2% ranked Australian Accounting Firm
Claims of being a ‘Top 2% ranked Australian Accounting Firm‘ (and similar claims) are based on two separate assessments conducted by Munro’s on 9-10 August 2023 and 1 December 2023. The ranking is derived from a comparison of the total of each accounting firm’s overall star rating multiplied by each firm’s quantity of reviews as shown on Google Maps. A total of 4,235 Australian accounting firms listed on Google Maps were identified for the earlier assessment, and a total of 4,301 for the latter assessment, which may not represent a complete list of Australian accounting firms. Munro’s claims are based on Munro’s best estimation and represent a snapshot collected at the time of each assessment. If the assessment was to be conducted today, then it is likely that Munro’s ranking would have changed – Munro’s may or may not be in the Top 2% today. Also, the methodology does not account for other potentially relevant factors such as quality of service, expertise, or client satisfaction beyond Google Maps reviews.
Read Key Points & Transcript
video key points
- Top 2% ranked Australian Accounting Firm is based on two separate Munro’s assessments of Google reviews for Australian based accounting firms on 9-10 August 2023 and 1 December 2023.
- Both assessments found Munro’s to be in the Top 2% (position 66 out of 4,235 and position 44 out of 4,301 for the assessments, respectively) when a ranking was derived from a comparison of the total of each accounting firm’s overall star rating multiplied by each firm’s quantity of reviews as shown on Google Maps.
- If the assessment was to be conducted today, then it is likely that Munro’s ranking would have changed – Munro’s may or may not be in the Top 2% today.
Presented by: Drew Pflaum
video transcript
In December 2023, we conducted a review of Australian accounting firms on Google Maps, based on star rating and quantity of reviews.
Out of the 4,301 Australian accounting firms we identified on Google, Munro’s ranked number 44, placing us in the Top 2% of Australian Accounting Firms. We’re thrilled to share this fact with you and share those reviews on our website. We’d also like to thank all our clients who left us those wonderful reviews.
Thank you.
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