Imitate, Innovate or Create?

There are two distinct kinds of market spaces in the world of business today. The most common are those whose boundaries are defined and accepted, and the rules of play are clearly understood.   Here, companies try to outperform their rivals in order to gain a greater share of an existing market. The result is that today,for more and more industries, supply is overtaking demand. Products are turning into commodities, and increasing competition is turning the waters bloody. There are also, however, spaces which are not defined.  They were unknown and untainted by competition. Demand in these spaces is created rather than fought over. These spaces are normally created when a company alters the boundaries of an existing industry. The main difference between these new market spaces and the more traditional are the set of managerial actions and decisions involved in making a business offering. The key is making the right strategic moves at the right time. Competition is not the benchmark in these markets, instead they make competition irrelevant by creating a leap in value both for buyers, and for the company itself. These companies reject the fundamental belief that a trade-off exists between value and cost.  They pursue differentiation and low cost simultaneously.  By driving down costs while driving up value for buyers, a leap in value is created. Cost savings are made by eliminating and reducing the factors an industry traditionally competes on, and buyers value is lifted by raising and creating elements the industry has never before offered. The whole system of a company's utility, price, and cost activities is then properly aligned. In doing this considerable economic and cognitive task,  barriers to imitation are created. Imitation requires companies to make changes to their whole system of activities. Few have the flexibility to make the necessary organizational and operating changes overnight. Imitating the whole-system approach is not an easy feat.