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Competitive advantage through quality relationships

It was for this reason, said the DTI report, that only by developing an effective strategy for managing and maintaining excellent relationships with all stakeholders could any organization hope to achieve its full potential.

‘A successful company is one that looks constantly to build on its existing relationships – be they external or internal – in a quest for competitive advantage.’

It said that whether internal or external, sustainable relationships relied on each party continually providing value, or at least the prospect of value, to the other party.

‘For your company to reach its full potential in this area, it is essential that you not only consider how you can develop and improve your current relationships, but that you also carefully consider how you can develop and improve the relationships necessary for your future success.’

For all these reasons, it was clear that leadership and communication were perhaps the most important intangible assets of all.

‘If companies are to achieve their full growth potential it is essential that clear goals and aims and values are set and embedded throughout the organization. This can only happen with strong leadership and effective communication. This is not just about people understanding what they are supposed to do, it is also about commitment because they believe that it is the right thing to do. This goes further than simply understanding mission statements and targets, but requires a much deeper understanding of context.’

In 2012, the Association of International Certified Professional Accountants and the Chartered Institute of Management Accountants published a report entitled: Rebooting Business: Valuing the human dimension. The world’s two most prestigious accounting bodies questioned more than 280 CEOs on the subject of current global challenges and what they saw as the priorities in leading the way through them.

The finding of this research was that it was the human dimension – relationships with customers, employees, partners and communities – that would be key to getting things moving again and sustaining success over the long run. It notes that:

‘Most of us sense that we are caught up in something big and uncertain. Much of what we have known – the paradigms that have guided business and government – have been disrupted by a dizzying pace of change brought about by globalisation, innovation and the fallout from the global financial crisis.’

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