Marketing Viewpoint by Ruth Winett
Innovation and Four Other Ways To Compete
Once companies competed against similar companies through achieving economies of scale. In "The New Logic of Competition" BCG outlines five new ways to compete in the 2020’s, including cultivating employees' imaginations in order to spur innovation: The new ways to compete are:
"Compet[e] on the rate of learning": To learn how to do new things, companies must “learn how to learn." Through use of Artificial Intelligence, Netflix can provide more personalized offerings.
"Compet[e] by creating … complex networks": Uber, Lyft, and others create non-traditional networks that include permanent and temporary employees. Amazon sells the products of merchants with which they also compete.
"Compet[e] in the physical and the digital world." This means building good relationships with customers and suppliers and adapting business models for “hybrid markets." Kohl's has announced that it will soon accept "eligible" Amazon returns.
"Compete on imagination." Inspiration and then imagination precede innovation. Instead of merely focusing on efficiency and the bottom line, companies should focus on creating new ideas. To "spark inspiration," BCG recommends that companies
Compet[e] on Resilience. With uncertainty continuing into the 2020's, companies must compete on flexibility and adaptability. This means challenging inflexible employees who insist that this is how we always do it…. It means "“constantly experimenting." It also means using data obtained through the Internet responsibly.
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