Management & Strategies & Barriers

Markides finds that all companies must answer three fundamental questions: who is the customer? what products or services should be provided? how can the company market these products at a profit? (1998, p. 32). As an industry matures, these questions are answered in similar fashion by increased numbers of companies, some of which are able to operate profitably and others of which fall by the wayside.

Strategic innovation occurs when a company finds new ways to answer these questions and is able to exploit a market niche (or even a new market) which previously did not exist. Because of the risk involved (new market strategies do not guarantee the same revenue stream that an existing strategy does), few existing companies are able to take on the role of strategic innovator successfully. Instead, we associate strategic innovation with new companies characterized by an entrepreneurial spirit. In this way, Dell Computers built a market by selling directly to the consumer rather than through dealers, and the Body Shop found a

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ies influence that perception; responding appropriately can help companies when that perception fails to live up to the customer's expectations. References Seiders, K., & Berry, L. L. (1998, May). Service fairness: What it is and why it matters. The Academy of Management Executive, pp. 8-20. Source: Sloan Management Review, Spring 1998 v39 n3 p31(12). Title: Strategic innovation in established companies. (includes related article on innovation at Leclerc) Author: Constantinos Markides Abstract: How firms can overcome the obstacles to strategic innovation and break the rules of the game in their industry. (Reprinted by permission of the publisher.) Subjects: Business - Innovations Strategic planning - Management Organizational change - Management Business Collection: 108V3240 Electronic Collection: A20873092 RN: A20873092
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Approximate Pages = 38 (250 words per page)