By M. Isi Eromosele
Globalization and technology innovation are giving rise to
an unprecedented level of competition while creating extraordinary
opportunities for companies to differentiate themselves. In today’s globally,
intensively interconnected business environment, a major challenge faced by
business organizations is how to maximize shareholder value and sustain growth,
while at the same time creating economic value for all.
An organization’s business applications and technology
infrastructure form the foundation upon which a company can implement
innovative, market differentiating business processes. For many companies,
growth depends on innovation. While product, service and operational
innovations are important, innovation must also be applied to a company’s core –
the way it does business and drives revenue.
Business model innovations are vital to creating new and
differentiating values for companies. Companies that can substantially change
how they add value to their own or other industries can differentiate themselves
and gain competitive advantage.
Business Model
Innovation
With intensified competition, rising customer expectations
and globalization affecting the way companies do business, fundamental business
changes are necessary. Business model innovation is the answer. The way a
company does business is an important differentiator because such innovations
cannot be imitated or commoditized the way product and services innovations can
be copied. The competitive advantage continuous business innovations offer
results in more long-term durability.
Business model innovation is a way to preempt competitive
threats from industry and non-industry competitors. Companies should strive to
be the ones driving change within their industries, instead of being a
follower. Business model innovation is really a natural evolution, since change
is inevitable, since a business model will eventually run its course.
Competitive
Strategy Evolution
Over the past several years, competitive strategy has been
evolving from one that is a zero-sum game where one competitor gains an
advantage at the expense of another, to one that is collaborative, where joint
effort creates more economic values for all involved.
In competing for global markets, traditional competitive
strategy stressed positioning in well-defined matured markets, striving to
build market share. The new competitive strategy calls for pre-positioning in
emerging markets and co-developing these markets with others, including
competitors. With this new paradigm, companies compete not to maximize market
share, but to maximize value.
Business leaders are now realizing that a company cannot
drive industry and market altering changes alone. Many companies, including
major industry titans are forging strategic alliances, combining their
expertise with the specialized knowledge of carefully chosen partners.
In competing for market share with new products, traditional
competitive strategy employ a closed business model by which companies compete
by spending incredible amount of funds on research and development. Today, an
increasing number of companies are adopting the open business model by which
they share expertise with their peers or competitors, jointly developing
products.
Within their companies, business leaders are affecting major
organizational changes, eliminating divisional boundaries and leveraging shared
services across the enterprise. They are pursing new business opportunities,
new competencies and new alliances, creating values not only for their
companies, but for their industries as well.
These companies are implementing innovations proactively,
resulting in business designs that truly differentiating. This enables them to
be better equipped to efficiently respond to market changes and internal
operational demands. Additionally, forging collaborative partnerships are
enabling them to lower their operating costs, while providing opportunities for
increased revenue generation.
M. Isi Eromosele is the President |
Chief Executive Officer | Executive Creative Director of Oseme Group - Oseme Creative | Oseme Consulting | Oseme Finance
Copyright Control © 2012 Oseme Group
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