As I sat across from my latest potential client, I knew that my next words could make or break the meeting. It was a conversation I’d had many times before and it either ended in a beautiful collaboration, or it ended the meeting fast. But, as always, honesty was the only way forward. “Tell me this” I began, “what’s your competitive advantage?”. I got back the one answer I never want to hear “Our brand is great, and so are our people!’.

Here it comes. The bit that can make or break the conversation. “Your brand and your people aren’t a competitive advantage – they’re just permission to play the game.” I explained. What makes this so hard is, I know businesses put a lot of work into their people and their brand, but despite what you might think, they’re not a source of competitive advantage. At best, they’re temporary advantages. I explained to my new client that if you really want to win, you need to create something that is valuable, difficult to copy, rare, and that you can execute on. That’s true sustainable competitive advantage, and the ones who have it always win.

I know this because I’ve been there. I’ve seen the fear in the eyes of clients who are afraid to take risks. I’ve watched as companies with great potential get an uplift for a little while only to stagnate and eventually fade away. And I’ve also seen the power of true innovation – the kind that transforms industries and changes lives.

I could see the scepticism in their eyes. It was a familiar look. They were probably thinking, “What the hell does this guy know about our business?” But I pressed on. “And the thing is, your brand and your people – they’re nice, but they’re not your competitive advantage. Everyone has those. What do you have that nobody else does? Do you actually have a competitive advantage, or do we need to create one.”

It was the question that always led to an uncomfortable silence. It was the question that caused discomfort as their brain ran over the options. Kick him out or carry on? But, as I’ve learned over the years, discomfort is sometimes necessary to provoke change. The truth is, most businesses are simply not primed for innovation. If they can’t handle a very simple question, then they can’t handle what would need to be done to execute on a plan.

I took a deep breath and leaned back in my chair, waiting for the response. It was the moment of truth. Would they dismiss me as a quack, or would they take the first step toward true innovation? After a few moments of silence, they finally spoke.

“You’re right,” they said. “We need to do better. We need to innovate or evaporate.”

I grinned. “I like the way you think. Let’s get started.”

And so began my latest adventure in the world of management consulting. Over the years, I’ve seen it all – the good, the bad, and the ugly. I’ve worked with businesses of all sizes, from startups to multi-national corporations, and I’ve learned a few things along the way. One of the most important things is that true sustainable competitive advantage is hard to come by. But it’s not impossible. With the right mindset and the right approach, any business can create something truly valuable and unique.

But businesses these days have been blindsided by the ‘feel good’ factors disguised as competitive advantage that they don’t actually have one. Brand, people, vision, mission, all of those things help you along the way but they’re never the source of your advantage. To build competitive advantage there are established frameworks and models and strategies that we can use to make the whole thing easier, and it doesn’t usually involve sitting around a lunch room holding hands and singing Kum Ba Yah.

So, how do we get there? How do we foster a culture of creativity and innovation? Well, it starts with understanding what’s holding us back. There are three main obstacles that I’ve seen time and time again – lack of diversity, resistance to failure or change, and a lack of direction towards the promised land.

Let’s start with diversity. It’s no secret that diverse teams are more creative and innovative. When you have people from different backgrounds, with different perspectives and ideas, you’re more likely to come up with something truly unique. But the problem is, most businesses don’t have diverse teams. They hire people who look and think like them, and they end up with a homogenous group that struggles to think outside the box.

That’s where neuroscience comes in. Studies have shown that our brains are wired to seek out familiarity and avoid the unfamiliar. It’s a survival instinct – we’re more comfortable with what we know. But that can be a problem when it comes to innovation. We need to push ourselves out of our comfort zones and embrace the unfamiliar. We need to create an environment where people feel comfortable sharing their ideas, even if they’re different from what we’re used to. And we need to actively seek out diversity in our teams, whether it’s through hiring practices or partnerships with other companies. More diverse teams have more perspective, and more perspectives lead to better solutions. Simple.

The second obstacle is resistance to failure or change. It’s natural to want to avoid failure – it’s uncomfortable and can be costly. But the truth is, failure is often necessary for innovation. We need to be willing to take risks, to try new things, and to accept that not everything will work out. That’s easier said than done, of course. Our brains are wired to avoid risk and uncertainty. We’re more likely to stick with what we know, even if it’s not working, than to take a chance on something new.

But here’s the thing – failure is not the end of the world. In fact, it can be a valuable learning experience. Studies have shown that our brains are more active and more engaged when we’re faced with uncertainty or novelty. We’re more likely to remember and learn from experiences that challenge us. So, instead of avoiding failure, we should embrace it. We should create an environment where failure is seen as a learning opportunity, not a mark of shame. We should encourage experimentation and risk-taking, and we should celebrate the successes that come from it.

The final obstacle is a lack of direction. It’s hard to innovate if you don’t know where you’re going. Businesses that lack a clear sense of purpose or direction will struggle to create something truly valuable and unique. Want to stay ahead of the game? As well as aligning your team to your vision and your mission, get them focused on solving your customers problems. Innovation and competitive advantage is about having a clear sense of purpose and direction.

So, to sum up, creating a culture of innovation requires diversity, a willingness to embrace failure, and a clear sense of direction. By understanding and overcoming these obstacles, any business can foster a mindset of creativity and develop a sustainable competitive advantage. As the meeting finished, there was excited energy in the room. I could see the spark of innovation in her eyes, and I knew that she was ready to take the first steps towards true innovation. As the meeting came to a close, I packed up my materials and said my goodbyes. We were on a quest to find true competitive advantage. I was happy, and so were they.

Until next time keep questioning, keep exploring and keep that prefrontal cortex firing.