The document provides a diagnostic tool to assess an organization's vulnerability to bias for exploitation, helping identify areas that may lead to disruptions when advantages change. It describes scoring ranges that indicate varying degrees of reliance on existing advantages, from extreme exploitation to embracing practices suitable for transient advantage economies. Organizations are encouraged to evaluate their current practices and consider adjustments based on their assessment scores.

1. Diagnostic:
How
vulnerable
are
you
to
a
bias
for
exploitation?
In
a
world
in
which
advantages
are
fleeting,
one
of
the
most
significant
challenges
is
coping
with
systems
and
processes
that
are
basically
geared
to
exploiting
existing
advantages.
While
that’s
not
a
bad
thing,
necessarily,
it
can
lead
to
an
unbalanced
way
of
working,
which
in
turn
can
leave
you
vulnerable
to
disruptions
when
advantages
move
on.
The
following
diagnostic
can
help
pinpoint
areas
in
which
a
bias
toward
exploitation
is
present;
and
suggest
changes
that
you
might
want
to
make.
Simply
position
your
organization’s
current
way
of
working
between
the
two
statements
in
the
quiz.
Those
areas
to
the
left
are
those
which
you
might
want
to
have
a
good
hard
look
at.
Exploitation
Oriented
More
Balanced
Budget,
people
and
other
Critical
resources
are
controlled
by
resources
are
largely
controlled
by
1
2
3
4
5
6
7
a
separate
group
than
those
that
heads
of
established
businesses
run
businesses
We
tend
to
extend
our
established
We
tend
to
move
out
of
an
advantages
if
we
possibly
can
1
2
3
4
5
6
7
established
advantage
early,
with
the
goal
of
moving
on
to
something
new
We
don’t
have
a
systematic
process
We
have
a
systematic
way
of
exiting
for
disengaging
from
a
business
1
2
3
4
5
6
7
businesses
Disengagements
tend
to
be
painful
Disengagements
are
just
part
of
the
and
difficult
1
2
3
4
5
6
7
normal
business
cycle
We
try
to
avoid
failures,
even
in
We
recognize
that
failures
are
uncertain
situations
1
2
3
4
5
6
7
unavoidable
and
try
to
learn
from
them
We
budget
annually
or
for
even
We
budget
in
quick
cycles,
either
longer
1
2
3
4
5
6
7
quarterly
or
on
a
rolling
basis
We
like
to
stick
to
plans
once
they
We
are
comfortable
with
changing
are
formulated
1
2
3
4
5
6
7
our
plans
as
new
information
comes
in
We
emphasize
optimization
in
our
We
emphasize
flexibility
in
our
approach
to
asset
utilization
1
2
3
4
5
6
7
approach
to
asset
utilization
Innovation
is
an
on-­‐again,
off-­‐again
Innovation
is
systematic,
a
core
process
1
2
3
4
5
6
7
process
for
us
It
is
difficult
for
us
to
pull
It
is
quite
normal
for
us
to
pull
resources
from
a
successful
1
2
3
4
5
6
7
resources
from
a
successful
business
to
fund
more
uncertain
business
to
fund
more
uncertain
opportunities
opportunities
Our
best
talent
spends
most
of
Our
best
talent
spends
most
of
their
their
time
problem-­‐solving
and
1
2
3
4
5
6
7
time
working
on
new
opportunities
handling
crises
for
our
organization
We
try
to
keep
our
organizational
We
re-­‐organize
when
new
structure
relatively
stable
and
to
fit
1
2
3
4
5
6
7
opportunities
require
a
different
new
ideas
into
the
existing
structure
structure
We
tend
to
emphasize
analysis
We
tend
to
emphasize
over
experimentation
1
2
3
4
5
6
7
experimentation
over
analysis
It
isn’t
easy
to
be
candid
with
our
We
find
it
very
easy
to
be
candid
senior
leaders
when
something
1
2
3
4
5
6
7
with
senior
leaders
when
goes
wrong
something
goes
wrong

2. Diagnostic:
How
vulnerable
are
you
to
a
bias
for
exploitation?
After
completing
the
diagnostic,
simply
total
the
scores
you
gave
yourself.
If
you
are
completing
the
diagnostic
as
a
group,
use
the
average
of
the
scores
for
each
item
from
the
group
and
then
total
the
average.
This
first
set
of
results
will
give
you
an
overall
perspective
on
where
your
organizations
stands
with
respect
to
transient
competitive
advantage
overall.
The
total
score
values
below
puts
you
in
a
band
with
the
most
likely
scenarios
described.
Score
between
14-­‐28
Scores
in
this
range
indicate
an
extreme
orientation
toward
exploiting
an
existing
advantage.
This
is
only
a
safe
place
to
be
if
you
are
in
a
monopoly
position
(government,
long-­‐term
patents,
enormous
barriers
to
entry,
legislative
protection)
or
are
operating
in
an
extremely
stable
niche
market
(for
instance,
Steinway
pianos).
For
organizations
in
other
circumstances,
this
result
would
be
alarming
as
very
few
of
the
practices
that
are
suitable
for
transient
advantages
are
in
place.
An
immediate
action
step
would
be
to
examine
the
underpinnings
of
your
current
success
and
see
whether
they
are
likely
to
remain
stable
or
to
change
to
assess
whether
a
more
aggressive
change
program
is
in
order.
Score
between
29-­‐42
This
result
suggests
that
your
organization
is
strongly
biased
toward
exploiting
existing
advantages.
You
are
at
risk
of
being
trapped
in
an
existing
business
model.
As
with
the
first
category,
scores
in
this
range
merit
a
clear-­‐eyed
examination
of
whether
the
existing
state
of
affairs
in
your
organization
is
likely
to
last
for
some
time
and
whether
an
investment
in
developing
capabilities
more
suited
to
a
transient
advantage
context
are
warranted.
Score
between
43-­‐56
This
score
band
is,
in
my
experience,
the
most
common.
Chances
are
that
there
are
pockets
of
dynamism
within
the
organization
that
are
trying
to
respond
quickly
to
a
more
competitive
environment,
but
the
central
bias
of
the
organization
is
still
toward
exploiting
existing
advantages.
You
can
expect
the
processes
both
of
innovation
and
disengagement
to
struggle
against
the
status
quo
in
the
existing
organization.
This
situation
is
often
quite
politically
difficult
as
new
business
models
and
ways
of
working
come
into
conflict
with
prevailing
practices.
It
is
often
necessary
for
the
senior
team
to
take
ownership
of
instituting
a
more
dynamic
way
of
working
across
the
organization,
as
it
will
be
difficult
to
sort
out
the
many
conflicts
at
an
operating
level.
Score
between
57-­‐70
Scores
in
this
region
suggest
that
your
organization
has
begun
to
adopt
a
faster,
leaner
and
more
flexible
approach.
You
can
expect
to
see
that
some
effective
practices
are
in
place,
and that
older
structures
and
systems
are
being
changed
to
move
more
quickly.
The
leadership
challenge
is
to
make
sure
that
the
shift
to
new
ways
of
working
doesn’t
result
in
people
losing
focus
on
keeping
the
business
healthy,
and
to
continually
reinforce
the
new
ways
of
working.
Some
parts
of
the
organization
have
learned
to
move
faster
and
become
more
adaptive,
while
others
are
probably
still
reflecting
past
glories.
Score
over
71
Your
organization
appears
to
be
embracing
many
of
the
practices
that
work
in
the
transient
advantage
economy.
I’d
love
to
hear
from
you!
In
particular,
it
would
be
interesting
to
know
how
your
company
decides
what
remains
stable
and
what
should
be
more
dynamic.
In
addition,
when
it
is
time
to
move
on
from
a
past
advantage.