In mature markets, where growth is slow and costs are managed to the extreme, what differentiates one company from another? Many organisations and managers have actually become rather indistinguishable in that they uniformly pay attention to teamwork and quality, reduce costs where they can (often through outsourcing) and get rid of poorly performing executives—these activities make for good organisations. But then what give some companies a leading edge over others? It comes down two factors.
The first is brand—a strong brand reputation makes people believe that a Mercedes is better than a Ford, and can help a company even if this belief proves not to be true (e.g. if Mercedes outsourced some faulty components and their quality did decline below the perceived quality of Ford).
The other differentiating factor is people. Better led teams will be more motivated; when there’s a single company mentality, especially among [...]