A competitive edge is what businesses are looking for in today’s market. The main differences among competitive strategies comes down to (1) whether your company sets aim on a market target that is broad or narrow, and (2) whether your company is pursuing a competitive advantage linked to low-cost or product differentiation.
At the highest level, our colleagues’ research on economic profit distribution highlights the existence of a power curve that has been getting steeper over the past decade or so and is characterized by big winners and losers at the top and bottom, respectively (see Strategy to beat the odds,” forthcoming on ). Our research on digital revenue growth, meanwhile, shows it turning sharply negative for the bottom three quartiles of companies, while increasing for the top quartile.
Then the acquisition includes physical assets that can be quite valuable if bought for less than comparable new assets, if there is a limited supply of the assets, or if the business is in strategic locations (for example, a car rental business, or a string of self-service laundries).
As technology and business leaders consider the immense task of creating an ecosystem in which cocreation and innovation thrive, they can begin both by reimagining what technology can do for the business and viewing technology as an opportunity to enable business disruption and create sustainable competitive advantage.
Process represents the buying experience the customer gets when they buy your product or service, such as the way a fine bottle of wine is presented and served in a restaurant, the reaction of a business to a complaint, or the speed of delivery in a fast food outlet.