There is no doubt that the opening of the Tunisian economy brings many challenges. The globalisation has reduced many of the local conditions on which Tunisian companies base their competitive advantages. A typical example is the removal of the Multi-fibre Agreement, which has affected enormously the textile sector. Companies are focusing their efforts mainly on enhancing the capabilities at the level of products and services. However, this approach only solves part of the problem, because to focus on the "effect" and not in the "cause" of competitors’ superiority is not enough to create sustainable competitive advantages.

A new beast: the strategy-based competitor

To understand how to compete in an open market, at local or international level, it is necessary to comprehend two issues. First, the opening process of the Tunisia’s economy is just a change on the rules of the competition game. The rules associated to a stable market, which is a characteristic of protected economies, are not longer valid in Tunisia. Industries and market sectors, previously dominated by pseudo-monopolies of small group of companies, are now open to international competition. Competitive advantages previously associated to close personal relationships disappear and new rules are developed based on companies’ internal resources and capabilities.

Second, to compete in an open market a new kind of capability is required. Much of the superiority of foreign companies is found in areas such as lower cost production, products of higher quality, better marketing, higher investment capability, etc. However, all of this is the result of a much stronger internal force which has as core element the capability to see, think and act strategically. This force enables organisations to develop the competences that in the end allow them to understand market conditions and trends, analyse competitors and find their own weaknesses, identify internal areas for development, innovate through the development of new products and services, etc.

"Strategy capability" provides organisations with two critical elements: the power to understand the surrounding environment and to control their actions better than competitors. Many Tunisian companies have a short-term, opportunity-based approach to their growth plans, with a limited understanding of how they are created and they will evolve in the future. Therefore, their businesses are linked to the highs and lows of the market.

On the contrary, strategy-based companies behave differently. They first assess and select opportunities to fit their strategy. As an example, the most successful IT service companies in the world reject more than 40% of their potential business. Secondly, they create opportunities through innovation and market foresight.

Why strategy development is so important to Tunisian firms

What is necessary to succeed against companies that can make "X rays" of organisations and markets? : to become a strategy-based organisation. This conclusion is not a new statement. Strategy has been the centre of all warfare matters for centuries. Let’s look at some of the teaching of Sun Tzu’s Art of War, written more than 2000 years ago:

• Win all without fighting (Achieving the objectives without destroying it)
• Avoid strength, attack weakness (Striking where the enemy is more vulnerable)
• Deception and foreknowledge (winning the information war)
• Speed and preparation (moving swiftly to overcome resistance)
• Shaping the enemy (preparing the battlefield)

It is clear that the key capabilities in all these statements are the abilities to identify, understand, analyze and plan, elements which are associated to an strategic approach For example, in business words, the first advice point at not to go to a price war (for many companies the easy way to compete) because you can reduce the profitability level of a sector and reach a point where everybody lose and nobody win. The airline industry is a good case of a low-profit industry. The last statement highlights the need for understanding the business environment, that is, customers, suppliers, technology, etc, as the way to strength the market position in relation to competitors.

For Tunisian companies, acting strategically is a matter of success or failure. According the prestigious organisation Oxford Business Group, as the result of the opening process, "…Tunisian officials estimated at the time that at least one-third of around 11000 existing industrial enterprises would go bankrupt during the adjustment period, while another third would require substantial support in the transition". The chances of survive are related to the ability to develop quickly a strategy-based organization.

The first step on this direction is to master the process of strategy development and implementation. The key issue is not to have the right strategy but to master the process through which an organisation develops its strategy. It is like a journey where the experience acquired walking through the path is more important that the reward at its end.