The Future of Competitive Strategy

4

Introduction

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

firm. And, with the scope of these opportunities still expanding, data becomes a fountainhead for new initiatives for all firms to create value. These takeaways, however, also raise some important and broader questions. What, for instance, underlies the ability of data to generate new value-creating opportunities? How can firms envision and maxi- mize the scope of these opportunities? How can firms establish com- petitive advantage when contending for them? To answer such questions, firms need first to appreciate some key tenets regarding how they can effectively generate and steer digital ini- tiatives. Three such tenets, discussed next, provide a glimpse of what is at stake for every legacy firm aspiring to compete in the modern dig- ital world. These tenets also present the foundational concepts for a modern-day digital competitive strategy that the book elaborates on in subsequent chapters. Using data is not per se a novel concept. Most firms possess data on their products, markets, and operations. They analyze it for insights and decision-making. Based on analyses of sales data, for instance, Ford knows which of its cars are more popular, in what geographies, and with which specific dealers. Ford routinely uses such insights for prod- uct development, capacity planning, and marketing. These are long-­ established practices in legacy firms. What is different today is that modern digital technologies allow data to be used in far more expan- sive ways. Interactive Data Modern data is shifting its emphasis from being episodic to interactive . Episodic data is generated by discrete events, such as the shipment of a component from a supplier, the production or sale of a product. Inter- active data, on the other hand, is streamed by continuously tracking asset performance and product-user exchanges through sensors and the Internet of Things (IoT). Continuous tracking of assets and their Tenet 1: Recognize the New Potential of Data