7 Powers: The Foundations of Business Strategy by Helmer Hamilton

Author:Helmer, Hamilton [Helmer, Hamilton]
Language: eng
Format: epub
Publisher: Deep Strategy LLC
Published: 2016-11-15T16:00:00+00:00

This now allows me to place Cornered Resource on our 7 Powers display.

Figure 6.4: Cornered Resource in the 7 Powers

Cornered Resource definition:

Preferential access at attractive terms to a coveted asset that can independently enhance value.

The Five Tests of a Cornered Resource

The Power hurdle is high: to qualify, an attribute must be sufficiently potent to drive high-potential, persistent differential margins (m >> 0), with operational excellence spanning the gap between potential and actual. With an enterprise like Pixar, there are numerous resources critical to success, and sorting through this multiplicy to try to isolate the Power source can be a challenge. Over the years I have found that five screening tests for a Cornered Resource often help in this process.

Idiosyncratic. If a firm repeatedly acquires coveted assets at attractive terms, then the proper strategy question is, “Why are they able to do this?” For example, if one discovered that Exxon was able to persistently gain the rights to desirable hydrocarbon properties, then understanding their path to access would be the more crux issue. Perhaps their relative scale allows them to develop better discovery processes? If so, their discovery processes are the Cornered Resource, the true source of Power, and it would be misleading to simply cite only the acquired leases.

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