The Future of Competitive Strategy

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Introduction

©2022 MIT. This excerpt is from The Future of Competitive Strategy by Mohan Subramaniam, published by The MIT Press.

competitors. The chapter also discusses how a legacy firm can contend with digital competitors when crafting its digital ecosystem strategy. Chapter 8 discusses new digital capabilities required to compete with data in digital ecosystems. It elaborates on the capabilities needed to unlock the value of data from production and consumption ecosys- tems. It discusses how legacy firms can fuse new digital capabilities with their prevailing capabilities as they craft their digital competitive strategy. Chapter 9 discusses some of the challenges associated with data and data sharing in a world where privacy and security are of increasing concern. It offers some guidance for legacy firms to balance the value they can derive from sharing data with the negative externalities of doing so. Chapter 10 puts all these insights together to offer a holistic view of what it takes to establish a data-driven digital competitive strategy. It also offers an action plan for legacy firms to develop and execute a digital competitive strategy. In 1960, Professor Ted Levitt of the Harvard Business School published an influential paper titled “Marketing Myopia.” 22 He noted that when firms focus solely on their prevailing products, they often lose sight of the changing needs of their customers. Firms focused on making buggy whips, for instance, failed to see their customers shifting from horse carriages to other forms of transportation. To avoid such myopia, he implored firms to ask the question, “What business are we in?” For the classic example, if the buggy whip company had asked the relevant question—“Are we in the buggy whip business or in the transporta- tion business?”—it might have avoided being disrupted. It might have moved to sell products more suited for customers who were using new means of transportation other than horse carriages. The notion of “business” soon became synonymous with “indus- try.” Even Levitt’s original article intersperses the terms “business” and This Book’s Vision