In my post last week I talked about the recent 2013 Detroit Auto Show, and how the recovery of the American auto industry provides a great lesson in the importance of not taking your position in the marketplace for granted. It also shows the importance of diversity at the level of individual companies. It is too easy to get complacent with a leading product and forget the importance of innovation. An over-reliance on SUVs at the detriment of smaller, fuel efficient vehicles damaged the Big 3 for years, but we don’t have to look far to find even more stark real-world illustrations.
One example that springs to mind is the rivalry between Microsoft and Apple, where Microsoft went from a position of seemingly intractable market dominance to playing second fiddle. This is in large part because Microsoft maintained a static product line, while Apple, in contrast, has succeeded in creating a wide variety of new devices and new revenue streams.
By looking beyond their traditional sphere of success to other sectors where their strengths would apply, Apple fundamentally changed the face of the music industry. Then they revolutionized the way we use mobile devices. Microsoft continues to churn out new versions of Windows and Microsoft Office, but has lost its formerly significant edge as the world has shifted around them.
Every company has the skills and knowledge to strategically take on new challenges that can multiply its successes. When they do, it increases competitiveness and strengthens the market for everyone.