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Summary: Important insights on the direction of innovation
Review: This is an important book on several levels. For people in business, it provides important insights about current trends in entrepreneurship and management. From their field work, Mitchell and Coles discovered that the most successful companies are those that engage in frequent business model innovation. These companies, however, did not start out with business model innovation. They stumbled upon it almost by accident. Having been pleasantly surprised about the success of the initial innovation, they embarked on others. Mitchell and Coles believe that, as more and more business leaders come to understand the importance of business model innovation, it will become "the most important leadership and management activity of the next ten years." This obviously information that people in business need to know about. It's also something that economists should pay attention to. Innovation is perhaps the key component in explaining the dynamics of a capitalist economy. Unfortunately, for most academic economists, innovation is regarded, not as an essential attribute of an economy, but as an "external force" that is inexplicable by economic theory. Or, if innovation is admitted as an endogenous force, its regarded as a kind of wild card -- as something that, because it cannot be unambiguously quantified, is of little use in the development of sophisticated economic models, which nowadays are almost always of staggering mathematical complexity. Reading a book like The Ultimate Competitive Advantage reminds us that knowledge comes, not from abstruse theorizing, but from experience, from practical life. As Paul Ormerod has noted, economists can learn a great deal from the serious work of business writers and scholars, precisely because such work is often rooted in the experience of the real world business world, rather than in abstract academic theories, which are framed largely to fit into mathematics, rather than to accurately describe the real world. While the Ultimate Competitive Advantage is certainly not a work of economics and is written entirely for businessmen, the empirical insights it provides into the way the market actually works in real life should not be missed by those eager to cast off the discredited theories of mainstream equilibrium economics.
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Summary: I confess I cheated¿
Review: Yes, I cheated when I read this book. Twice, actually. First, I skipped all the main text and just read the stories in text boxes. Fascinating examples of big name firms and relative unknowns who have mastered their marketplace. The authors have gathered some of the most interesting business stories you will ever read. And read them you should. Why read The Ultimate Competitive Advantage? Donald Mitchell and Carol Coles have identified a systematic way to gain an ongoing competitive advantage. Ongoing is the key, by the way. You don't just jump out front and get the lead until your product or service gets tired or your industry gets tired of you. You have strategies revealed here to keep the pressure up on your competition by continually pulling away from them with innovation - both simple and complex. Second way I cheated? I went right to the ending. I wanted to know how the book turns out, okay? And everybody lives - happily ever after, too! Well now I've read it through the way it was written - all the words, the questions to ask, the creative ideas, and the answer to the big question in business: How do we lower our costs while expanding our offerings to customers? Here it is in living black and white, multiple ways to do just that. I've taken notes and have ideas - ideas that will make me much more customer-rich than before I'd picked this up. Get the picture? Get the book and get smarter by learning and applying what other brilliant organizations have done. This is a rare read with instant application for the entrepreneur and big company player. Most highly recommended!
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Summary: Truly original, and a fun read
Review: Business model obsolescence is the major unperceived opportunity for and threat to all businesses now. That's the central theme of The Ultimate Competitive Advantage, Secrets of Continually Developing a More Profitable Business Model by Donald Mitchell and Carol Coles. After a thorough description of the methodology used in conducting their research, Mitchell and Coles set out to describe four dimensions of continual business model innovation. These are: (1) Understanding and following the current business model; (2) Understanding and installing the next business model; (3) Understanding and using a business model innovation vision; and (4) Ongoing design and testing of potential business model innovation visions. Throughout the book, a children's lemonade stand is used as a metaphor for applying continual business model innovation. At first, this seems a bit odd, but when one reads on, all pieces of the puzzle neatly fit together. Real-life examples of companies already successfully applying continual business model innovation, and of companies that do not, provide the reader with valuable insight into the process of improving the market position and profitability of their companies. For an "American" management book, it is remarkably well structured, and delivers its central message in a powerful, convincing way, based on broad research. What's more, it actually makes a point that has not yet been made in the same way in another management book. It is, in other words, truly original and should be read by anyone managing a company, be it large, medium-sized, or small.
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Summary: Don't Embrace Change, Force It
Review: The Ultimate Competitive Advantage is the most useful business book I've ever read. Many how-to-succeed business books focus on a single technique, philosophy, or management style. Often their claims are rooted more in opinion than in fact. The Competitive Advantage goes well beyond telling us that we should simply emulate Jack Welch as a means to profit nirvana. Mitchell and Coles conducted an exhaustive long-term study of dozens of successful companies across a broad spectrum of industries, looking for a common thread explaining their extraordinary performance. Is there something companies of all sizes and types can do to positively differentiate themselves from competitors and enhance sales, profits, and reputation? Yes, and Mitchell and Coles have isolated it. They distill it to its essence in The Ultimate Competitive Advantage. In its simplest form, the advantage is the practice of identifying one's business model, and then intentionally changing it for the better--again and again in a never-ending process. If you don't do it, someone else will. But this isn't simply about improving the better mousetrap. This is about the broader and somewhat nebulous concept of business modeling, which they explain in great detail. Mitchell and Coles' intensive research reveals that the fastest growing companies in their control group revamped their business models on a continuous basis, sometimes yearly or biannually. They were not satisfied to "rest on their laurels" or milk a successful model to death. As a simplistic example, we've all heard the saw about being too busy chopping the tree to sharpen the axe. The advice in this book takes you beyond axe sharpening to whole new chopping models. How about opening tree-felling "camps" for wannabe lumberjacks? Students bring their own axe and pay you to "learn" the lumber industry while they produce your product. Costs plummet, profits soar, the community benefits. This book opens your mind to the infinite possibilities in your own business. Thoroughly researched, well written, up-beat, well intentioned, and heavy on specificity, The Ultimate Competitive Advantage is a high-utility business tool that managers can refer to year after year for ideas on keeping their models fresh and staying ahead of Brand X. Very highly recommended. --Christopher Bonn Jonnes, COO of American Polywater Corp. ...
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Summary: Not a Quick Read,... But Well Worth the Time
Review: Donald Mitchell and Carol Coles present an interesting exploration of competitive advantage and the need for continual business model innovation. I have to admit I'm a little sick of the advice from other gurus to "change everything and to change it now." These gurus seem to forget that their customers determine success. Customers don't always expect, want, or need a "revolution." However, Mitchell and Coles present a way of looking at competitive advantage through the lens of the customer. In other words, they suggest crafting innovative business models in ways that are meaningful to the market... to customers. Another aspect of the book that really hit home was that amount of attention paid to the company's key stakeholders. Study after study confirms that firms with successful stakeholder relationships generate the highest returns to investors/shareholders. Throughout the book, the authors suggest ways in which employees, suppliers, distributors, and customers can (and should) be included in the development of business improvement -- to the mutual benefit of the company and its key stakeholders. One note of warning: this book is content rich. It requires both your time and concentration. For those willing to make the investment, I believe you will be well rewarded.
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Summary: Very thought provoking book
Review: This is an excellent and very thought provoking book on how to master the art of business model innovation, which the authors call "the ultimate competitive advantage". The book has three main components: 1)detailed examples of the practices of highly successful companies in the area of business model innovation; 2)recommended strategies for achieving success with business model innovation; 3)a large number of questions designed to becoming proficient in this discipline. As an academic working with the development and delivery of trainings and programs to business and public sector organizations, this book has given me a lot of useful ideas for how to go about innovating the business model that we are using within this area in my organization.
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Summary: Great practical book on staying in tune with your market
Review: In business, everyone wants to be a "rentier." That is, the businessman that just sits back and lets the profits (rents) roll right in without breaking a sweat. To keep the profits rolling in without encroachment from other firms, you must have a competitive advantage: something others do not have. A true competitive advantage is difficult to find and you need to keep that advantage for a long time. Unfortunately today's competitive advantages come and go quickly. Industry segments come and go in as little as 5 to 8 years. This book, The Ultimate Competitive Advantage, tells you how to find and sustain your firm's competitive advantage over long periods of time. They observed most firms don't recognize impending changes properly nor do they drop existing ways of doing business (business models) because they have worked well in the past. Most firms noted as successes in their industry go for the one big revolution and then get forced out. They are caught flat-footed. This process might look like this: Start:
Significant industry change happens.
Entrenched, successful businesses don't change their business model.
New guys come up with a new business model that better fits the change.
New guys replace old guys because old guys move too little, too late.
Repeat every 7 years. To keep your firm growing and profitable, the authors of this book recommend that you constantly improve or replace your business models. You should not just improve your existing business model by selling harder or by reducing costs. Instead you should search for newer models that fit the changes going on in your industry. You should do more of what's working, but then test new models constantly. When new models work out, then start implementing them slowly to your business. This way you won't get caught flat-footed, wondering what to do. This is the "Ultimate" part of the books title. It should keep you ticking forever. The book is worth the questions alone. Andy Grove of Intel fame would have you wait until you recognized big changes on the horizon (see his book "Only The Paranoid Survive"). Instead of waiting until change is upon you, the authors of this book want you to be constantly testing new models ahead of time. As the change is growing, you should be replacing the business models that are no longer working well with newer, better ones. This is a more pro-active and explicit approach than Grove offered. Testing offers a "Try before you buy" approach. As an aside, I found Grove's advice (be constantly paranoid) like saying "Keep your head down when you swing your golf club." It is correct, but much like a platitude. If your firm can create customers then you probably have a profitable business model today. But because your industry can change dramatically, you must have a way to quickly adapt to a new successful model. You should read this important book so you can learn how to do this. I liked their overall thinking, the specific list of things to do, the list of questions to consider for my business at the end of each chapter, and their well-researched examples. As the authors ask: "When was the last time you changed your business model? What were the last three business models before the current one?" So many embarrassing questions, so little time. If you are interested in competitive advantage, you definitely should read this book. I have heavily underlined my book and made many annotations in the margins. John Dunbar
Sugar Land, TX
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Summary: Change is inevitable
Review: Adapting to change is the key to growth (and survival). The authors proffer that the best-performing corporations are those that constantly review, update and adapt their business models to adjust to changing conditions. They illustrate the reports on their research with fascinating case studies. You will discover the ultimate competitive advantage. I note that I am writing review #80 and nearly everyone is giving this book five full stars. That is an unusual number of fans for a new book. This book must be very good; you do not have to take just my word for it. Dan Poynter
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Summary: Good business advice from authentic source
Review: Books written by business school faculty expound new theories and artfully use case studies to advance them. The best of them offer new insight and expand our knowledge. Most bore us to tears or put readers to sleep in the first few pages. Or, their theories are stretched beyond what the data support. Or, the case studies are distorted. Or.... Business books written by consultants are often poorly disguised vehicles for advertising, heavy in citing their own advice that led to miracles, transformations, and ultimate industry dominance. The best of these, one suspects, are ghostwritten. Hence, what they lack in authenticity is hidden by the high gloss of smooth prose. The reason I like this book so much is that it successfully avoids the major weaknesses of this genre. The Ultimate Competitive Advantage by Don Mitchell and Carol Coles provides good, practical advice designed to assist business leaders in thinking hard and critically about core business models. Many real-world business examples are used to illustrate basic concepts such as pricing strategy, enhancing customer satisfaction, and the constant search for innovation-in all of its various forms to improve how a business operates, competes and achieves greater success. Most important to me, of course, is the absence of chest-thumping throughout the narrative. One does not know if the authors could claim some credit for the business success stories cited in this book. For this reason, the book is easy to read and presents an earnest credibility rarely found in the business section of a bookstore. The book's narrative is not glittery in the way that gems sparkle, not weighted down with obscure jargon, and not over-stuffed with buzz words or clichés. The advice, however, is good. The examples reinforce the themes. And the themes are important and salient. Readers will obtain the greatest value from the outstanding questions at the end of each chapter. These key questions will help business executives understand the implicit assumptions underlying their current business model and stimulate them to think more critically about how to break out of the mold. Successfully managing a business today requires constant innovation, challenging implicit assumptions about business models, and experimentation to learn more about how to improve operations and products. These themes are well developed in this fine book. I recommend it highly to those who understand change, innovation, and improvement are necessary to sustain successful businesses. Reviewed by Tom Bonnett, Public Policy Consulting, Brooklyn, NY
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Summary: Just What We Need!
Review: At a time when:
· "Downsizing" appears to be the corporate world's primary growth strategy, Mitchell and Coles bring a much-needed perspective on...and approach to...business modeling.
· "How to" books provide such conceptual information as to be useless and such neutral-stance information as to be meaningless, Mitchell and Coles present a research-based book that contains concrete, actionable information...information the reader can immediately apply, upon reading the book.
· "Guru" books provide cookie cutter solutions that are difficult to apply (at best) or are so self-serving as to lack credibility (at worst), Mitchell and Coles present learnings from a variety of leaders, organizations, and industries, as well as well thought-out principles we should all act upon.
· "Enron" dominates media headlines, Mitchell and Coles introduce ways for leaders to do the right things, for the right reasons...for their companies, their shareholders, their stakeholders, and their people. Mitchell and Coles have written a book that should become part of every consultant's, executive's, and educator's personal library. Concisely written, this book will prove to be a quick and easy read for business, community, and government leaders whose time is already stretched to the limit. Purchase this book...read it, mark it up, set it down, give it some thought, and then return to it. Take the tested and proven principles Mitchell and Coles cite and apply them to your world...use them as a tool for making your "corner of the world" a better place in which to live.
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