The process of strategy discussion and commitments typically starts in October. It identifies the strategic issues for the next calendar yearand three to four years hence. Speed of reaction, not tied to a rigid corporate calendar is of the essence. Speed is also an element in how fast a company learns new technologies and integrates them with the old. As all traditional companies are confronted with disruptive changes, the capacity to learn and act fast is increasingly a major source of competitive advantage.
Innovation is the new source of competitive advantage.
Innovation was always a source of competitive advantage. However, the concept of innovation was tied to product and process innovations. Reducing cycle time, increasing modularity, tracking sales from new products introduced during the last two years as a percentage of total sales, and global product launches were the hallmarks of an innovative company. Increasingly the focus of innovation has to shift towards innovation in business models. Business innovations are crucial in a competitive landscape subject to disruptive changes.