Competition - Digital insights
The second domain of digital transformation is competition: how businesses compete and cooperate with other firms. Traditionally, competition and cooperation were seen as binary opposites: businesses competed with rival businesses that looked very much like themselves, and they cooperated with supply chain partners who distributed their goods or provided needed inputs for their production.
Today, we are moving to a world of fluid industry boundaries, one where our biggest challengers may be asymmetric competitors, companies from outside our industry that look nothing like us but that offer competing value to our customers. Digital “disintermediation” is upending partnerships and supply chains—our longtime business partner may become our biggest competitor if that partner starts serving our customers directly.
At the same time, we may need to cooperate with a direct rival due to interdependent business models or mutual challenges from outside our industry. Most importantly, digital technologies are supercharging the power of platform business models, which allow one business to create and capture enormous value by facilitating the interactions between other businesses or customers.
The net result of these changes is a major shift in the locus of competition. Rather than a zero-sum battle between similar rivals, competition is increasingly a jockeying for influence between firms with very different business models, each seeking to gain more leverage in serving the ultimate consumer. The digital age has enabled the industry to leverage the network effect and winner takes all has been the new norm.
We at Pi-One has enabled our customers to think out of the box and have enabled them to embrace competition, create more value through digitally scalable products and solutions. Some of our customers have seen quantum benefits and gains through our digital solutions.