The Future of Competition: 8 key ideas
The core ideas of The Future of Competition, each in under a minute, written in our own words. Want the full depth? Get the book.
- IDEA 1 OF 8
Value is no longer made alone
Prahalad and Ramaswamy argue that companies can no longer create value on their own and simply sell it to customers.
Value is increasingly created together, through interactions between firms and consumers.
- IDEA 2 OF 8
Consumers have become active
Thanks to the internet and better information, consumers now compare, share opinions and demand more say.
The authors argue this shift changes the balance of power between companies and customers.
- IDEA 3 OF 8
Co-creation is the new model
The authors call this new approach co-creation of value.
Customers help shape the products and experiences they receive, and companies must design ways for this participation to happen. The firm becomes a host.
- IDEA 4 OF 8
DART builds the foundation
The authors describe four building blocks: dialogue, access, risk assessment and transparency.
Together, these allow companies and consumers to interact honestly and create value jointly. Each block supports the others.
- IDEA 5 OF 8
Experiences matter more than products
The authors argue that people value the experience they have with a company, not just the product itself.
Each customer's experience can be different, depending on how they choose to interact.
- IDEA 6 OF 8
Design spaces for interaction
Companies should build experience environments, settings and tools where customers can personalise what they get.
The authors give examples from health care, technology and other industries. Customers choose how to engage with the firm.
- IDEA 7 OF 8
Networks replace single firms
The authors describe how companies increasingly work in networks with suppliers, partners and communities.
These networks together produce the experiences that customers value. No single company controls the whole experience any longer.
- IDEA 8 OF 8
Managers must think differently
The book argues that leaders need new skills and systems to support co-creation.
Old habits of controlling the customer relationship must give way to openness and continuous learning. Learning becomes constant.
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