What is an industry in today’s economy?
In a simpler age, it was easy to classify what your organization did. Now it’s easy to see digital transformation disrupting industry lines: Apple is disrupting the fashion industry, while apps are putting hotels out of business.
So how can your brand survive when competitors can come from anywhere?
Consider your broader industry
Before Blockbuster was beaten by streaming services, it ruled the video rental industry. Many have blamed Blockbuster’s downfall on a lack of innovation, but this is not true. Blockbuster drove many innovations, including the early adoption of Blu-ray discs.
Blockbuster’s problem was not a lack of innovation, but a focus on incremental innovation. Instead of accepting that the future was streaming, it focused exclusively on physical media.
To avoid making this mistake, you must consider your broader industry. As an example, look at Uber’s mission statement. The app’s aim is not to provide a taxi service but “transportation as reliable as running water, everywhere, for everyone.”
Establish an innovation division
If your organization can quickly create new offerings, you will likely survive the blurring of industries. Of course, it can be difficult for legacy organizations to have the same agility as startups. Unless yours has been molded in the startup mindset, you cannot ignore established procedures for affecting change.
To stay agile, you must establish divisions dedicated to innovation (which should be separate from your main organization). Then, once they develop an idea with potential, they should have C-level oversight allowing them to leverage some existing organizational overheads without being stifled by the existing machine.
Branch beyond your boundaries
Competition does not always come from startups. The exciting truth is that it can come from anywhere. Consider Volvo, which has embraced innovation around their core competencies for over ninety years.
The secret to Volvo’s success is that their innovation is always tied to their core business—cars. Consider their famous inflatable children’s seat or their collaboration with Netflix to bring media to self-driving vehicles.
React in real time
In the past, it was easy to see competitors as they rose in power. This was because it took them time to gather resources and build business platforms—time that could allow you to out-maneuver them. Now, hyperconnectivity lets your competitors piggyback on existing platforms and quickly scale to leverage existing demand. Ride-sharing services are a great example—they have a low barrier to entry and price sensitivity.
To see the writing on the wall while it’s being written, you must develop real-time data solutions that can help you quickly react to customer behavior.
While the blurring of industry boundaries poses significant threats, it also opens exciting opportunities for organizations.
For more insight on customer behavior, see E-Commerce Alert: How Non-Functional Requirements Impact User Experience.