Developing Sustainable Competitive Advantages for Colleges and Universities

presented by
Dr. Robert A. Sevier
Senior Vice President, Strategy

2 | Competitive Advantage | © STAMATS 2015
Strategy
■ Vision development
■ Strategic planning
Academic Services
■ Academic program marketability
assessments
■ Identification of new academic
programs
■ New program marketing
Research and Assessments
■ Tuition price elasticity and brand value
studies
■ Brand clarification and development
■ Image and perception studies
■ Recruiting and marketing assessments,
plans, and counsel
Stamats is recognized and respected as one of
the nation’s higher education thought leaders.
Our comprehensive array of innovative
products and services has set the standard for
pairing insightful, research-based strategic
counsel with compelling creative solutions.
Our approach is simple: recognize the unique
needs and expectations of each client and
draw on more than 60 years of higher
education experience for every project we
undertake.
At all times, we promise the highest level of
professional service and attention to detail in
the industry because, in the end, we know our
success is measured entirely by the success of
our clients.
Stamats Strategic

Stamats on Your Campus
 Stamats has a wide array of presentations
and workshops that we conduct on campus for
departments, senior leadership teams, and boards
 A partial list of sessions includes:
 Developing a Compelling Institutional Vision
 What Lies Ahead – a Review of Major Trends and Issues
 Developing an Integrated Marketing Communication Plan
 Building a Brand That Matters: The Four Critical Elements of a Successful Brand
 Strategies to Increase the Marketability of Your Academic Programs
 Please contact me for a complete list or to discuss a session for you in greater
detail. Thank you, Bob (bob.sevier@stamats.com)

Overview
 Understanding competitive advantage
 Developing sources of competitive advantage

Michael E. Porter

Understanding Competitive Advantage

What is Competitive Advantage?
 A condition or circumstance that puts an organization in a favorable or
superior market position
 An advantage gained by offering customers greater value than competitors
offer
 What compellingly distinguishes you from the competition in the minds of
your customers
 Something you do/offer that is of value to the marketplace that is not
done/offered by your competitors

Competitive Advantage: Five Understandings
 Clear sense of who your competitors are
 Clear sense of who your customers are
 Clear sense of what your customers value
 Strategic focus
 An ability, as an organization, to focus on your competitive advantage
and reduce the time and resources you spend on those actions that do
not enhance this competitive advantage
 Strategic messaging
 Build your brand message around your competitive advantage

Why Competitive Advantage Matters
 Increases organizational certainty
 Allows you to focus resources for maximum ROI
 Adds constancy and predictability to your revenue streams
 Helps you achieve organizational momentum
 Reduces unnecessary marketing and recruiting expenditures
 Helps make your promotional messaging stand up, and stand out
 Helps you become a magnet for:
 Talent
 Brand alliances
 Issue-focused investors (donors, foundations)
 Similar, in many respects, to Blue Oceans

Competitive Advantages and Strategic Planning
 Three outcomes of the situational analysis:
 Barriers that will prevent achieving
your vision
 Opportunities
 Competitive advantages

Build-up
Steps forward,
consistent with
Hedgehog Concept
Accumulation of
visible results
Flywheel builds
momentum
People line up,
energized by results
Flywheels

Disappointing
Results
No build-up; no
accumulated momentum
Reaction, without
understanding
New direction,
program, leader, event, fad, or
acquisition
Doom Loop

Distinctive Competencies and Competitive Advantage
 Distinctive competency
 Something you do/offer that you value
 Inward focus
 Competitive advantage
 Something you do that your competitors do not that your customers
will pay for
 Outward focus
 Questions:
 What are the differences between the two?
 Which has a market orientation and which has an institutional
orientation?
 Ultimately, which is of most value?

Key Overlaps
Core
Competencies
Marketplace
Interest
Competitor
Offerings

Necessary Alignments
 Competitive advantages
must align with your:
 Mission and vision
 Organizational culture
 Budget
 Operational plans
 Marketplace interest
 Your prospective
students and donors
must find your
competitive advantage
compelling, intuitive,
and obvious
Mission and
vision
Organizational
culture
Budgets
Operational
plans
Marketplace
interests
Five
Alignments

An Effective Competitive Advantage
 Flows directly from your mission and vision
 It is intuitive
 Leverages existing assets
 Is sustainable over time
 Customers clearly understand its value
 High barrier to entry (your competitors cannot easily duplicate)

The Importance of Sustainability
 A true competitive advantage is long-term
 A one-time price cut is not sustainable, but a commitment to
One-Course-At-A-Time is
Sustainable
Competitive
Advantage
Hard-to-find
substitute
High
marketplace
demand
Difficult for
competitors
to acquire or
imitate

Two Broad Sources of Competitive Advantage
 Cost
 Compelling differentiation
 Questions:
 What factors contribute to (low) cost?
 What factors contribute to compelling differentiation?

Twin Faces of Competitive Advantage
 Outward facing:
 Cost (generally means lower)
 High demand programs
 Compelling brand
 Inward facing:
 People, process, and structures that
support your outward-facing
competitive advantages
 Leadership
 Culture
 Facilities
 Numerical fluency
 Continual process improvement

Traditional Contributors to Competitive Advantage
 People
 Leadership, talent, culture,
commitment to execution, speed
of implementation (hustle),
attitude of innovation
 Business processes, practices, and
efficiencies
 Scale up, scale down
 Customer service
 Customer intimacy
 Resource base
 Talent, dollars, alumni, Rolodex™
 Decision making
 Numerical fluency, time to
decision
 Organizational structure
 Value proposition
 Programs (curricular, co-, extra-)
 Niche, only game in town (OGIT),
blue ocean?
 Facilities
 Partnerships/strategic alliances
 What you know about who you know
 Database
 Brand, brand awareness

 Costco
 Apple
 Jaguar
 Michael Kors
Examples of Competitive Advantage

Who Has What Competitive Advantage?
Who
 Harvard
 The University of Phoenix
 The Ohio State University
 The University of Southern California
 Notre Dame
Competitive Advantage





 Did you notice that it is difficult to identify a competitive advantage
without also identifying the competitors?

Market Position: What’s YOUR Story?
• Strengthened selectivity, improved
matriculation
• Enrollment growth across programs
• Growth of net tuition revenue and net
tuition per student
• Better student retention
• Increased percentage of students from
outside the local region or out of state
Positive Indicators
• Weakening of selectivity and/or
matriculation
• Declining enrollment
• Stagnant or declining net tuition or net
tuition per student
• Rapid growth of tuition discount
• Unrealistic assessment of peers and
competition
Negative Indicators

Where Do You Fit in the Competitive Landscape?
Market… In This Role You Will…
Leader
Follower
Challenger
Disruptor

Competitive advantages are always validated by the
marketplace

Developing Competitive Advantage

Institutional Roadblocks
 What institutional habits or culture gets in the way of developing
competitive advantages?
 What are some options for addressing these issues?

Four Steps
1. What are you selling? You’ve got to be very clear on what you are
selling
2. Who buys what you sell? Who are your customers? Why do they buy
from you? Why do they buy from your competitors?
3. With whom do you really compete? What do they do/offer that you do
not? How does their offer compare to yours (from the perspective of
your customers)?
Once you are clear on these three determinants, then you can decide what
benefit you provide better than the competition to your target market.
4. Build your brand around your competitive advantage. Reinforce your
competitive advantages in every message and channel

Key Questions
 Based on data – students
 Why do full-pay students attend your college?
 Why do full-pay students not matriculate?
 With whom do you truly compete for students?
 Based on data – donors
 Why do alumni give?
 Why do donors who are not alumni give?
 Why do people only give once?
 What motivates donors to move up the giving pyramid?
 With whom do you truly compete for donated dollars?

Competitive Advantage Array
Competitive Advantage Valued by
Donors
Valued by
Students
Valued by
Others
Item: ______________________________
 Cost
 Compelling Differentiation
Item: ______________________________
 Cost
Item: ______________________________
 Cost
Item: ______________________________
 Cost

Remember:
1) All sources of competitive advantage must directly
contribute to either cost or compelling differentiation;
2) Your brand should be built around your source of
competitive advantage

Resources
 White papers
 http://www.stamats.com/resources/white-papers/
 Innovator’s bookshelf
 http://www.stamats.com/innovatorsbookshelf
 Business plan for new majors
 http://www.stamats.com/resources/white-papers/managing-your-academic-
portfolio/
 Academic Strategist
 http://www.stamats.com/resources/academic-strategist/
 Tweet
 Strategypublishing.com
 Row
 Vision-Centric Strategic Planning
for Colleges and Universities

Developing Sustainable Competitive Advantages for Colleges and Universities

Recommended

Recommended

More Related Content

What's hot

What's hot (19)

Similar to Developing Sustainable Competitive Advantages for Colleges and Universities

Similar to Developing Sustainable Competitive Advantages for Colleges and Universities (20)

Recently uploaded

Recently uploaded (20)

Developing Sustainable Competitive Advantages for Colleges and Universities

Editor's Notes