Most companies try to differentiate themselves from their competitors by better products or improved processes leading to a better cost structure. The problem is that their competitors do the same thing at the same time so after a firework of new products the situation is pretty much the same. You moved forward but your competitor also moved forward. If you do not move you fall behind. This effect is also called the Red Queen Effect. It takes all the running you can do, to keep in the same place. That is the typical situation most companies find themselves in. You move, you move but you gain no competitive advantage.
This trend will continue unless you make time to plan and carry out tasks that will enable your business to become more PRODUCTIVE and more PROFITABLE. If you fail to make business development a priority, then this cycle will only conclude when either you, or your business, collapse. There are literally hundreds of different things you can do to improve the productivity and profitability of your business. Some will take a long time to implement; others can be completed very quickly. Some offer only a small improvement to your business, while others can be nothing short of revolutionary.
Business model innovation is about building a new business model with which you can differentiate yourself within your business model you use.
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1 comment:
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