BY DR. TANAI CHARINSARN

JANUARY 20, 2017

“Action is the foundational key to all success.” — Pablo Picasso

Over the past few decades, strategists have been searching for the answer to what makes a business more successful than others, and two prominent concepts emerged: "positioning" in the hearts of customers and "possession" of valuable resources. However, in recent times, strategic thinking has shifted its focus towards "entrepreneurial execution," a theory driven by a visionary perspective.

In the 1980s, the widely accepted concept was "positioning," where strategists believed that occupying a unique and distinctive place in customers' minds would make them memorable and perceived as offering more value than competitors. This notion still holds significant importance in contemporary business, especially in branding and marketing, as it cultivates brand loyalty and a willingness among customers to pay a premium for a perceived superior value.

Business Examples Illustrating the "Positioning in Customers' Hearts" Concept:

1. Walmart: Walmart's clear positioning as "Everyday Low Prices" has made it synonymous with affordable shopping. Customers looking for budget-friendly products often think of Walmart first, creating a strong competitive advantage for the company.

2. MINI Cooper: The MINI Cooper, despite being a premium car, positions itself as a fun and youthful choice, appealing to a demographic seeking an exciting driving experience. This demonstrates that positioning isn't limited to a specific age group or income level, but rather about creating a distinct place in customers' hearts.

The Concept Acknowledged in the 1990s: "Possessing Valuable Resources"

In the 1990s, strategic thinking shifted to focus more on an organization's internal factors. Strategists began to evaluate a company's resources, skills, abilities, strengths, and areas of expertise. The idea revolved around the belief that a successful business was one that possessed superior resources or competencies compared to its competitors, such as having cost-efficient supply chains or highly skilled personnel.

Business Examples Illustrating the "Possessing Valuable Resources" Concept:

1. Fast-Food Chains: Companies like McDonald's and 7-Eleven have excelled in the fast-food and convenience store industries, respectively, partly due to their advantageous physical locations. These prime locations ensure high foot traffic, which is crucial for their success. As a former McDonald's CFO once said, "We are not in the food business; we are in the real estate business."

2. Technology Companies: In the tech industry, companies that invest in research and development and have superior technological capabilities often lead the market. For instance, companies like Apple, Samsung, and Huawei have maintained their competitiveness through innovative products and technology.

The Current Acknowledged Concept: "Entrepreneurial Execution"

In contemporary times, strategic thinking is increasingly focused on "entrepreneurial execution," where new or smaller companies compete with industry leaders by offering innovative and disruptive products or services. These companies may identify niche market segments or fulfill under-served consumer needs that larger corporations may overlook. The success of these new entrants doesn't necessarily stem from having more resources or superior technology but from understanding consumer preferences and having the courage to innovate and fill gaps in the market.

Business Examples Demonstrating "Entrepreneurial Execution":

1. Innovative Startups: Small startups that introduce disruptive innovations or cater to niche markets often succeed by educating consumers about their new products or services. They may redefine customer preferences and change their customers' loyalties.

2. Small Companies Competing with Industry Giants: Smaller companies may compete effectively with industry giants, not because they have more resources or better technology, but because they understand consumer needs and take calculated risks by introducing innovations or filling market gaps.

This shift in strategic thinking highlights the importance of entrepreneurial spirit, adaptability, and understanding customer behavior in the rapidly changing business landscape.

Business Examples Demonstrating "Positioning in Customers' Hearts" Concept include Facebook, Airbnb, Uber, and "Tao Kae Noi."

Recent strategic thinking has emphasized having a vision and entrepreneurial execution. This means taking risks, getting hands-on, and being agile in business operations.

In conclusion, while strategic concepts evolve with time, there is no one-size-fits-all theory for success. Success is often a result of various factors coming together, combining excellent resource possession with the courage to take action. Some businesses can indeed secure a position in customers' hearts, but they must also deliver on their promises to maintain long-term success. Similarly, start-ups and newly emerged businesses must do more than just being bold and visionary; they need strategic thinking, comprehensive planning, and adaptable resource management. Having the best resources doesn't guarantee sustainability, as resources eventually deplete. Machinery will become obsolete, employees retire, and so on. Therefore, the answer to the question of what makes a business successful remains ever-evolving and requires continuous study and the development of concepts according to the era.