Marketing
Issue No. 40 - April/ /
Competitive strategy update
by Dr David Corkindale and Dr David Corkindale
I was contacted by a consultant who did his business studies in the 1980s.
“What are people taught these days about competitive strategy?” he asked. “It was based on Porter’s 5 Forces in my day; is that still used? What’s new? I have a new client and I want to appear up to date.”
The way industries and businesses operate today is different to the way Porter envisaged: many are now part of networks and/or use outsourcing and play in a much more international arena.
So, Porter’s way of depicting what influences the level of competition and profitability of an industry is not as simple to apply as it used to be. Some companies compete for projects with their customers or suppliers, for instance.
Porter’s frameworks are still taught, but complemented by the newer Resource Based Theory and a raft of trendy, proprietary approaches like Blue Ocean Strategy.
I have to say that at one level much of all of this can be seen to be just a sophisticated form of doing a good old SWOT analysis and using it to facilitate the classic ‘Where are we – where do we want to be?’ exercise.
My experience is that these exercises are rarely creative in the sense of redirecting the business. Where a company knows it has a big problem – like those who have relied on cheap and available water – such exercises applied in a functional and linear manner do not usually produce the needed solution.
What is missing is something innovative – a flash of inspiration or a creative leap by somebody. Sometimes it is being aware of what somebody else is doing and seeing the full scope of what could be done – in other words, being a good plagiarist.
Stumbling on Strategy
The IT scientists, Brin and Page, who developed the innovative Google search method, did not see the money-making potential in it. Neither did the Alta Vista, Excite or Yahoo search engine executives to whom it was initially offered ...
