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Competition Strategy in Deeply Digitalized Era

Oct 15-2021   



Over the last five years, Prof. Xie Xuanli of the NSD has been researching corporate digital transformation, which amounts to the fourth industrial revolution after steam engines, electricity, and information technology. In a speech at a forum celebrating the inauguration of Cheng Ze Garden as the new campus of the NSD, she says that digitalization has re-shaped the fundamentals of the business environment.

 

The impact of digitalization on the business environment and ecology is evident in four facets: many goods have migrated from tangible to intangible forms; physical space has turned into digital and virtual one; centralization is ceding ground to decentralization in which individuals wield a much bigger say; and companies are switching from selling products to offering services.

 

In light of such momentous shifts, companies should craft their strategy by factoring in demand, product, business model, competition, competitive edge, organization, and corporate decision making, says Prof. Xie. As for demand, consumers are increasingly involved in product design and sharing their experiences, which influences the purchasing decisions of other consumers. Companies need to put more focus on consumers’ preferences and requirements so as to provide new values to them. In terms of business model, its three archetypal components, namely value creation, value delivery, and value acquisition, have all undergone radical transformation. As a result, a single enterprise might not be in a position to offer complete solutions to the customers, hence the need to collaborate with other companies to achieve 1+1> 2.

 

In the digital era, organizations must be agile, for disruptive competitors tend to crop up unexpectedly and the duration of competitive edge has been greatly slashed. Organizations must also learn to use both internal and external non-structural data for decision making – something that most Chinese firms are yet to master.

 

Prof. Xie says that “change” is a neutral word and the quintessence of strategy remains unchanged in the face of digital technologies. For entrepreneurs with strategic thinking, the digital era is one for embracing challenges and creating the future.

 

Competition Strategy in Deeply Digitalized Era

Oct 15-2021   



Over the last five years, Prof. Xie Xuanli of the NSD has been researching corporate digital transformation, which amounts to the fourth industrial revolution after steam engines, electricity, and information technology. In a speech at a forum celebrating the inauguration of Cheng Ze Garden as the new campus of the NSD, she says that digitalization has re-shaped the fundamentals of the business environment.

 

The impact of digitalization on the business environment and ecology is evident in four facets: many goods have migrated from tangible to intangible forms; physical space has turned into digital and virtual one; centralization is ceding ground to decentralization in which individuals wield a much bigger say; and companies are switching from selling products to offering services.

 

In light of such momentous shifts, companies should craft their strategy by factoring in demand, product, business model, competition, competitive edge, organization, and corporate decision making, says Prof. Xie. As for demand, consumers are increasingly involved in product design and sharing their experiences, which influences the purchasing decisions of other consumers. Companies need to put more focus on consumers’ preferences and requirements so as to provide new values to them. In terms of business model, its three archetypal components, namely value creation, value delivery, and value acquisition, have all undergone radical transformation. As a result, a single enterprise might not be in a position to offer complete solutions to the customers, hence the need to collaborate with other companies to achieve 1+1> 2.

 

In the digital era, organizations must be agile, for disruptive competitors tend to crop up unexpectedly and the duration of competitive edge has been greatly slashed. Organizations must also learn to use both internal and external non-structural data for decision making – something that most Chinese firms are yet to master.

 

Prof. Xie says that “change” is a neutral word and the quintessence of strategy remains unchanged in the face of digital technologies. For entrepreneurs with strategic thinking, the digital era is one for embracing challenges and creating the future.