Shifting towards People, Partners and Processes.
There are many pressures on the enterprise today, but two major trends are the globalization of mainstream markets, resulting in commoditization of product and price, and the rise of specialized markets driven by an increasingly “online” world, which make previously scattered buyers accessible via well-defined, recognizable “communities.”
Aggregating the number of buyers in these communities represents a market-place potential at least as large as previously mainstream markets.
This is the concept of the “Long Tail,” which states that businesses should be positioning to “sell more of less,” or, to put it another way, expect to produce more varieties of their product to serve different markets to achieve higher margins as well as overall revenues, as opposed to higher volumes with lower margins.
This change requires Business Model Innovation, i.e. shifting from “Reactive” and “Proactive” to a new “Interactive,” business model to engage with these new community markets.