The Competitive Advantage of Adversity

Following a week of training in New York, I spent the weekend visiting my sister in Upper Manhattan. I expected the city to be a busier version of Toronto but quickly discovered a prominent divide between the rich and the poor. For every million-dollar penthouse there were valet drivers and doormen servicing them. For every block of shopping and restaurants there were beggars and panhandlers trying to get by. I am not oblivious to inequality, but it was disheartening to see people who experience drastically different qualities of life interact so closely, every day.

As a tribute to those struggling with adversity, this is how I believe you can re-purpose your hardship into something useful and powerful. There is a risk that I grossly oversimplify people’s hardships, but my goal is to change the negative connotation associated with adversity. Your adversity is not a crutch that hinders you and holds you back. Instead, your adversity creates a competitive advantage that makes you hungry, empathetic, and battle-tested. These characteristics make you valuable to the workforce and to society, and unique to you, are traits that money cannot buy.

What is a competitive advantage?

In business strategy, a competitive advantage refers to capabilities an organization leverages to outperform its competitors. Originally conceived by professor Michael Porter, competitive advantages can span a number of different characteristics including good customer service, low cost business processes, or differentiation of goods and services.

In the same way companies compete against each other in the marketplace, I believe people compete against each other in society. As employable agents, people develop their own competitive advantages that make them valuable to an organization, attractive to a partner, or make them successful, however they define success to be. A common framework to evaluate if something qualifies as a competitive advantage is the VRIN-Framework developed by Jay Barney. If a company possesses an advantage that is VRIN, an acronym that stands for valuable, rare, inimitable and non-substitutable, then it possesses a sustainable advantage that allows it to outperform its competitors. Similarly, if adversity is a competitive advantage for individuals, it must be valuable, rare, inimitable and non-substitutable.

Adversity is rare, inimitable and non-substitutable

In general, anyone could correctly argue that they face some form of adversity, whether it be related to family, income or anything else. But if we define a specific subset of adversity, such as the bottom 10% of income earners in a population, then by definition this specific branch of adversity is rare. Unlike other forms of adversity that are relative to each person, poverty is an objective measure of adversity that only a certain demographic faces.

Poverty is also inimitable and difficult to substitute because poverty is hard to proxy. A privileged person might be able to volunteer to help the poor, but voluntarily experiencing poverty could never replicate the holistic feeling of hopelessness some impoverished people feel everyday (1). Living conditions can be mimicked to shed light on the hardships of poverty, but experiencing those conditions without a definite end is hard to recreate.

Therefore, what remains in qualifying adversity/poverty as a competitive advantage is proving that it is valuable. This is unintuitive because having less money means fewer options, more hardship, and fewer opportunities. I am not advocating poverty because I understand that it is rarely ever a choice, but for those living through poverty, I would argue that there is legitimate value that only you have access to.

Adversity is valuable because it makes you hungry, battle-tested, and empathetic to others.

To start, poverty makes everything relatively more valuable, which creates a strong desire and work ethic to change one’s circumstances. Famous mathematician Anand Kumar recognized this distinctive willpower and started a free school called The Ramanujan School of Mathematics. Each year Anand trains 30 impoverished students in preparation for India’s toughest entrance exam, most of whom have studied without teachers while they worked as marginal farmers, rickshaw drivers or brick levelers for their families (2). Anand’s students study up to 16 hours a day and have achieved unprecedented success, graduating over 230 applicants from the Indian Institute of Technology with a 90% acceptance rate (the typical acceptance rate for the school is two percent). Their success has driven a global outpour of support and monetary assistance, but Anand remains adamant on politely refusing donations because he believes money and infrastructure are not necessary for success. With the right guidance, courage and conviction, his marginalized students will their way out of their circumstances and epitomize what it means to turn poverty into power.

In addition to creating a strong work ethic, adversity and poverty force the poor to experience hardships that condition them for inevitable life and career-related challenges. Circumstances that seem grueling to average people will seem relatively easier to the poor because they are familiar with adversity. One of the world’s top military training programs share a similar, albeit more extreme, philosophy for their recruits. Navy SEAL programs are notorious for gruelling training because they are designed to simulate the battlefield. SEALs train as close to reality as possible because it is the best way to condition themselves to perform during a real situation (3). Similarly, experiencing hardship and poverty condition the disadvantaged for the realities of success. Doing great things is never easy, so experiencing adversity early prepares the poor for inevitable challenges in all future endeavours.

Finally, experiencing adversity and poverty develop a strong sense of empathy that is important in all corporate or leadership positions. A recent paper published by researchers Daniel Lim and David DeSteno of Northeastern University suggests a strong correlation between suffering and compassion. Through two separate studies involving varying levels of adversely-affected individuals, the researchers found that increasing severity of past adversity predicts increased empathy, which in turn, is linked to a tendency to feel compassion for others in need (4). This is relevant for leaders and corporations because research continues to show that executives, companies and organizations need to embrace empathy to increase customer loyalty, enhance company collaboration, and inspire others to follow (5). It is often said that the kindest people are the ones who have suffered the most. Similarly, I believe that what doesn’t kill you makes you kinder.

Conclusion

In conclusion, adversity and poverty can create a valuable, rare, inimitable and non-substitutable competitive advantage for the poor. Some may argue that the above examples are applicable to only a small sample size, but discussing this alternative perspective of poverty is the first step in encouraging it among the masses.

Thus, the purpose of this essay is not to garner sympathy for the poor. It is a call to action to anyone experiencing poverty to leverage your advantage and live your life with dignity and purpose. If you have experienced poverty then you have a duty to become the best you can possibly be because you define the boundary of what is possible for others. The most effective way to combat inequality is to put those who have experienced it in a position of power and influence, and that is one of the reasons why I work so hard every day.

* This post was originally published at www.lang-michael.com