Tag: Advantage

Every business tells you that its economics is unique, and it’s rarely true. But for television in the twentieth century, it was true. But today this is no longer the case and like in any other market, people pay for what they want and show great diversity in what they do want.

Natural monopolies – industries in which it is difficult for more than one firm to survive - seem the easiest, most rewarding of business opportunities. It’s not as easy as you think.

A successful business is more often defined by the distinctiveness of its relationships with customers than by the distinctiveness of its production systems.

The value of counterfactual history lies not in the questions it raises about the past, but the questions it raises about the present and future, and in the reminder that there is nothing inevitable about the world we observe.

Just as in football, business success is not simply a matter of acquiring the best people, or the best technology, or the best resources. It is the team that wins and in this year’s World Cup it was the Italian team being more than the sum of its parts.

Trust was a real competitive advantage for mutual businesses. But the difficulty of meeting the conflicting expectations of different users and the slow adaptation to the requirements of changing technology explains why mutuality ceased to be a viable basis for stock exchanges.
However, if mutuality is not the answer to customers’ requirements for providers they can trust, the industry badly needs to find other answers.

In Competing for the Future, CK Prahalad and Gary Hamel suggested that companies should adapt a strategy concerned with ‘creating stretch goals that challenge employees to accomplish the seemingly impossible’. But hindsight is a harsh taskmaster and most of the companies paraded by P&H for their foresight, have since underperformed.

Consumer goods markets are fickle and in a standards war, the best man does not necessarily, or often, win. Victory goes to the company that achieves a large installed base quickly.

The protracted battles to provide internet access or control the obsessions of players of computer games are the Thirty Years Wars of the business world, with advantage switching frequently among shifting alliances.

A jurisdiction benefits from forum shopping if its decisions are out of line with mainstream opinion, and the most common reason is that there is something wrong with its legal system.