Strategy is Choosing Where to Win

By: Marc Sanderson

 

Two companies started in the same industry at the same time. They hired similar people, built similar products and chased many of the same customers. Ten years later, one was consistently far more profitable than the other. The difference was not smarter people or harder work. It was better strategic choices.

 

The more profitable company knew exactly where it could win—and, just as importantly, where it couldn't. The leaders built the business around customers and projects that played to business’ strengths and had the discipline to walk away from everything else. That's strategy.

 

Michael Porter, widely regarded as the father of modern competitive strategy, argues that competitive advantage comes from making deliberate choices about where to compete and how to win—not from trying to be everything to everyone. Porter’s work can be distilled to a simple definition of strategy:

 

Strategy is an integrated set of activities that positions a firm within an industry to earn superior long-term returns.

 

Too often, leadership teams confuse strategy with goals, budgets or growth plans. Those are outcomes—not strategy.

 

Strategy isn't deciding what you want to be. It's discovering where your company naturally wins—and having the discipline to build around it.

 

Your strategy is often hiding in your last 100 projects—the work you excel at, the customers you serve and the jobs that quietly drain value. This is where your strategy begins.

 

Every CEO has three strategic choices to make:

 

• Play the right game. (Industry)
• Choose how you'll win. (Position)
• Align your business to deliver on that promise. (Integrated Set of Activities)

 

Most companies focus on one. The best companies master all three. Here’s how I see them play out to create strategy:

Industry: Play the Right Game First

 

The first question isn't: "How do we grow?" It is: "What game are we playing?" Every industry has different economics. Even in lower-margin industries, exceptional companies outperform because they play a different game. Too many manufacturers assume they're in a commodity trap, where price always wins. They're not. Every industry has customers who value something more than the lowest bid.

 

 Don't ask whether your industry is attractive. Ask where the best opportunities exist. The best fishing isn't spread evenly across the lake.

 

Position: Choose How You'll Win

Winning on purpose starts with knowing why customers should choose you. Too many companies say they're differentiated, then compete on price every time the pressure rises. They change their value proposition from customer to customer, from project to project. That's not strategy. That's reacting.

 

Most discussions of differentiation focus on innovation, brand or customer experience. In manufacturing and construction, differentiation often comes down to one of three key capabilities:

 

1. DELIVERY: Can customers trust that you'll deliver on time, every time?

When I purchased Wilkie, delivery became our strategic focus. We didn't just promise it. We built the systems, workflows and accountability to make it happen. That commitment ultimately led to the development of INNERGY, allowing manufacturers to compete on delivery with the ability to measure and manage.

2. QUALITY: Can customers trust you'll deliver exactly what they expect?

Quality means more than craftsmanship. It requires disciplined processes, from blueprint verification to quality assurance at every stage. Companies that inspect quality only at the end usually pay for mistakes twice. Leaders who compete on quality build it into every activity, from production through final installation.

3. SERVICE: Can customers trust you'll respond when it matters most?

In fast-moving tenant improvement projects, responsiveness often matters more than perfection. Customers value partners who are collaborative, proactive and agile. Only a handful of companies consistently achieve that level of service.

 

ACTIVITIES: Where 1+1=3

 

Every organization has the same core activities: estimating, engineering, scheduling, production, installation and accounting. The question is whether they make each other stronger.

 

This is where strategy becomes real. Most managers optimize functions. Great leaders optimize the entire system. When estimating supports production, production supports delivery, delivery strengthens customer relationships, and customer feedback improves estimating, something powerful happens.

 

One plus one begins to equal three.

 

The real competitive advantage is the plus sign—the fit between activities. Competitors can replicate individual capabilities. What they struggle to replicate is a system where each activity strengthens the next.

 

That's why an Integrated Set of Activities (ISoA) is often the hardest part of strategy. It requires leaders to align the entire organization so the whole creates more value than any single function could on its own.

 

Like fishing, no single advantage catches the fish. It's the combination of the right boat, the right lure, the right location, and the right execution. Strategy works the same way. Sustainable competitive advantage comes from how all the pieces fit together.

 

Fish Where the Fish Are

 

So where should a CEO begin? Start by understanding where your company wins today. Not every customer is equally valuable. Not every project is a good fit. Not every opportunity deserves pursuit. What does your data say?

 

One company, founded around the same time as Wilkie, couldn't understand why Wilkie consistently outperformed it. Rather than guessing, leadership first ranked customers based on experience. After implementing INNERGY, they validated those assumptions with project data.

 

The results were clear: Some customer types consistently generated strong margins while others quietly consumed time and resources. They shifted toward work that matched their strengths—and profitability followed.

 

Within three to four years, the company achieved its best financial performance ever, approaching Wilkie's profitability. Today, every strategic planning discussion begins with one question: Where should we fish?

 

That's strategy. Not chasing every opportunity. Choosing the opportunities where your company is built to win.

 

One of the hardest responsibilities of leadership is deciding what not to pursue. The wrong customer. The wrong market. The wrong project. Strategy isn't about saying yes to more opportunities. It's about saying no to the wrong ones. Every no sharpens your focus. Every yes should strengthen your strategy.

 

The Strategic Challenge

Great strategy is not about being the best. There is no universally "best" company—only companies that are the best fit for the customers they choose to serve.

 

Apple didn't become extraordinary by making every type of technology. It differentiated through an integrated ecosystem that competitors still struggle to replicate.

 

Ryanair didn't try to delight every traveler. It built an organization relentlessly optimized for cost efficiency, becoming one of the airline industry's most profitable companies despite operating in one of the world's toughest sectors.

 

Both companies made clear choices. Both built integrated systems. Both accepted that success meant saying no to many opportunities.

 

If your leadership team is beginning its strategic planning process, resist the urge to start with financial targets or growth goals.

 

Instead, ask four questions:

 

1. Where within our industry can we create the most value?

2. What position will we own, cost leadership or meaningful differentiation?

3. Are all our activities aligned to reinforce that position?

4. What customers, projects, or markets don't fit the previous answers?

 

The best strategies don't help you win every opportunity. They help you recognize the ones worth winning. Then, they align the entire organization to win them consistently.

 

Marc Sanderson is the CEO of INNERGY and former President/Owner of Wilkie Sanderson. He began in the millwork industry 20 years ago with a small cabinet shop and built it into one of the most profitable operations in the country. A Harvard MBA and 2024 Wood Industry Market Leader, Marc is known for transforming complexity into clarity through data-driven strategy and culture first leadership. Equal parts analytical operator and motivator, he’s just as comfortable refining strategy as he is rallying a room around a shared   vision.