Question
The book "Good Strategy, Bad Strategy" suggests that deregulation can have a significant impact on competitors. It can enable previously stretched competitors to become more involved with profit-making. However, it also implies that deregulation can lead to increased competition, which may result in a shift in industry dynamics. Incumbent companies may resist these changes. The book also introduces the concept of "attractor states", which provide a sense of direction for the future evolution of an industry, but these might not come to be.
This question was asked on:
Raise fixed costs: the simplest form of transition is triggered by a substantial increase in fixed costs, such as when traditional pistons were replaced by more advanced jet engines, which leaves but a few competitors left able to pay for the added cost Deregulation: this can enable previously stretched competitors to become more involved with profit-making Predictable biases: biases include an inability to predict a dip in sales after continuously rising all-time highs; an overprediction of current companies and business models; and the advice from consultants and analysts that businesses should copy whatever the current largest player does Incumbent responses: expect resistance from incumbent companies when dynamics start to shift Attractor states: this provides a sense of direction for the future evolution of an industry, but such attractor states might not come to be.
Receive new free presentations every Monday to your inbox.
Full content, complete versions — No credit card required.
