By Paul Wiefels, co-founder & senior advisor of Chasm Group, LLC
When markets undergo structural change, the greatest risk to an organization is not a lack of planning—it is reliance on the wrong kind of planning.
History offers a clear lesson. In the final years of the Soviet Union, economic decline was met with more centralized planning, more control, and more effort to perfect a system that was fundamentally flawed. The issue was not insufficient planning; it was that the planning itself reinforced and perpetuated the conditions causing failure.
Companies face the same trap during periods of disruption. When confronting a fundamental shift in technology, customer behavior, or competitive dynamics, the instinct is to intensify planning and execution against existing assumptions and traditional metrics. That instinct is often wrong. The answer is not more planning. It is planning for a different goal.
From Managing for Performance to Managing for Power
Most organizations manage to optimize performance—quarterly results, operational efficiency, and incremental growth. While necessary, performance is not sufficient in times of structural change. Leadership teams must instead manage for power.
Performance reflects how well a company competes within the current system. But periods of disruption are defined by large transfers of value—some of it trapped, some of it new. Power is the ability to influence outcomes—markets, customers, value chains, and ultimately the direction of competition itself. Power determines whether a company can shape both the system and its place in it going forward. Those who focus only on performance may be defending diminishing positions or those no longer relevant.
The Five Domains of Competitive Power
Power can be understood across five distinct but interconnected domains—a hierarchy of competitive advantage:
Category Power
The ability to define or redefine a category through innovation in technology, applications, or processes. This is the foundation of long-term advantage.
Industry Power
The ability to influence or control critical elements of the value chain—partners, suppliers, distribution, and ecosystem dynamics.
Customer Power
The ability to attract, capture, and keep customers at scale, creating momentum and market-share leadership that reinforces itself.
Offer Power
The strength of a company’s value proposition—its differentiation, relevance, and perceived risk compared to alternatives.
Execution Power
The ability to make fast, informed, risk-adjusted decisions and translate them into actions that reach tipping points.
Where Teams Can Fall Short
In practice, we often observe that organizations often misjudge their position across these domains; leadership teams can’t agree or align on where true advantage exists; resources are spread too broadly across competing priorities, or they reinforce outdated sources of advantage; and consequently, remediation efforts default to fixing performance gaps rather than building power.
Another common mistake is trying to address weaknesses across all domains simultaneously. This diffuses impact and leads to underinvestment in the areas that matter most for the future.
What Can Be Done?
To lead effectively through disruption, management teams must shift both perspective and discipline.
First, you must diagnose reality to establish a clear, shared view of the company’s position across all five domains of power. Next, align your teams by reconciling and eliminating gaps in perception, assumptions, and priorities both at the top of the organization and amongst those functions needed to initiate a shift.
Then, prioritize decisively by focusing resources on the domains that will define future advantages. Shift management attention, capital, time, and talent away from declining sources of advantage toward emerging ones. This requires accepting trade-offs elsewhere.
Finally, measure what matters. Track indicators of power—not just performance—to ensure the organization is building future position, not just improving current results.
Customers and investors care about performance—but they reward power. The fundamental question for any leadership team is not whether the plan is sound by traditional measures. It is whether the plan is building the power required to win in the next phase of the market. What got you here will not get you there. The organizations that succeed will be those that recognize this early—and act decisively.