The Future of Competition

The Future of Competition is by C.K. Prahalad and Venkat Ramaswamy, two professors at the University of Michigan Business School. The book raises an interesting notion that I haven't seen elsewhere before -- the notion that consumers today are dissatisfied with being just passive pockets of demand for an organization's goods and services. Technology and economics, not just in first world countries, but in third world countries as well, are tooling consumers to become active members in producing the goods and services they receive. This evolution is changing the balance of influence in the consumer-institution relationship in favour of the consumer. In their new roles, institutions must become 'experience environments' -- they must realize that quality will not longer be a measure of the goods or services received, but rather the co-creation experience received by each unique individual. For businesses that are successful in this transformation, the benefits are great. They gain access to consumer ideas for designing and manufacturing their products -- they can deeply understand their customers relationships with the firm. They gain customers that have an emotional bond and trust with their company and products. The book goes on to suggest a framework to achieving co-creation, and warns of potential pitfalls -- all a very interesting idea.