Book Summary In the first chapter, Prahalad and Krishnan outline their central thesis; that there are new managerial demands in business, requiring new sources of value creation. They argue that these demands have created an N=1 and R=G environment, where companies need to customize their product for each customer by gaining access to a new array of suppliers. The book argues that the old sources of competitive advantage -technology , labor, and capital – are fading and that new sources are emerging. Prahalad and Krishnan suggest an internal capacity to reconfigure resources in real time by focusing on clearly documented, transparent, and resilient business processes (the link between strategy, business models and operations) has become a strong differentiator. They also argue that a focus on co-creation, by developing an R=G supply network and emphasizing analytics which identify trends and unique opportunities can create a strong competitive advantage. The technical architecture required to develop these flexible and resilient business processes and strong analytics capabilities is outlined in the book. Key Concepts The book argues that "the industrial system as we know it has been morphing for some time. Now it may have reached an inflection URL Prahalad and Krishnan outline the approach that firms in the new economy must take to survive and become successful. The previous choice between low cost and differentiation is rarely the chief strategic choice anymore, firms must achieve what Prahalad and Krishnan call N=1 and R=G.
Book summary In the first chapter, Prahalad and Krishnan outline their central thesis; that there are new managerial demands in business, requiring new sources of value creation. They argue that these demands have created an N=1 and R=G environment, where companies need to customize their product for each customer by gaining access to a new array of suppliers. The book argues that the old sources of competitive advantage – technology , labor, and capital – are fading and that new sources are emerging. Prahalad and Krishnan suggest an internal capacity to reconfigure resources in real time by focusing on clearly documented, transparent, and resilient business processes (the link between strategy, business models and operations) has become a strong differentiator. They also argue that a focus on co-creation, by developing an R=G supply network and emphasizing analytics which identify trends and unique opportunities can create a strong competitive advantage. The technical architecture required to develop these flexible and resilient business processes and strong analytics capabilities is outlined in the book. Key concepts The book argues that "the industrial system as we know it has been morphing for some time. Now it may have reached an inflection URL Prahalad and Krishnan outline the approach that firms in the new economy must take to survive and become successful. The previous choice between low cost and differentiation is rarely the chief strategic choice anymore, firms must achieve what Prahalad and Krishnan call N=1 and R=G.
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