Question

Read the Article below

1. Briefly summarize the key point of the article, but DO NOT include any direct text from the article (i.e., don't quote or copy from the article), tell me in YOUR OWN words. This should be brief.

2. Explain how your article is connected to building a competitive advantage and five forces model assumptions. Explain what other businesses, or your employer, could learn from the key point(s) in this article.

Amazon's Competitive Advantage Isn't Cost Or Convenience, It's This

Competitive advantage as we know it, has changed. To stay relevant in today’s constantly changing competitive landscape requires the capacity to continually learn, evolve and grow into a better—more valuable—version of what you were yesterday. Competitive advantage today isn’t a matter of lowering costs—anybody can slash prices. It’s not a matter of hiring “better” people, although the human element is certainly a factor. It’s not solely a matter of corporate responsibility either, even though purpose is important. And it’s not a matter of a faster time-to-market despite the fact that failing fast informs sooner. No, competitive advantage is a matter of adaptability. Here’s why.

Apple

Originally a computer company, the $800 billion dollar tech giant has adapted its focus to include self-driving cars, augmented reality and even the payment space historically controlled by banks.

Google

The company that originally started as an online search engine built Android which now owns the majority of market share for mobile operating systems. It also ate the GPS navigation and mapping industries for breakfast, is working on internet-beaming balloons (what?!) as well as self-driving cars. Hey, why not?

Facebook

No longer “just” a social networking site but a technology powerhouse intent on creating augmented-reality glasses as well as ways to let you type with your brain (where was this when I was in school?)

Amazon

Amazon’s original focus was on selling books, and needless to say, they’ve adapted quite a bit. You can purchase anything—anything—through Amazon with the blink of an eye and have it delivered to your doorstep the next day. If that’s not convenience then I don’t know what is. Quite honestly, I don’t even know where to begin with Amazon because there’s pretty much nothing they don’t do. The point is, they’ve evolved this far because they value change and they value adaptability.

What do all of these companies have in common? Billions and billions of dollars--because they learned to adapt. They have built and sustained a competitive advantage because they learned to adapt.

That’s why the merger between Amazon and Whole Foods makes sense. Here you have two completely different companies fuzing together to forge not only a new alliance, but a new opportunity that, as a result, offers a new competitive advantage: options--a one-stop-shop for everything you need, now including organic produce.

However, adaptability isn't easy. Here are a couple things to remember when adapting to change:

Adapt through teams.

Aside from the psychological benefits of mutual support (misery loves company), teams are one of the best ways to effectuate long-lasting organizational change for a number of reasons. First, members learn to work together. Determining how work will get accomplished between Amazon and Whole Foods employees will be a challenge since each company has its own distinct cultural norms. The fastest way for people to learn how to work together, is to work together. Things don’t get any easier by ignoring them. If you want to move the needle—in anything—you’ve got to start moving. Period. Teams are no different.

One lesson we learned in the special operations community was the value of cross-pollinated teams. Meaning, we would take a member from one team and rotate him through another team, often to his dismay. What this did was reshape individual identity from one team to a collection of teams so that he had a wider panoramic view of the organization. He was able to bring with him the lessons learned from one team and share them with another which fortified the collective capacity of the organization.

Establish a new narrative.

One of the biggest challenges in any merger is redefining who you are—your organizational identity. The roots of identity run strong—especially in the case of Amazon and Whole Foods—which means there’ll be natural resistance to assuming a new one. For Whole Foods the challenge will be preserving its roots under the goliath-like shadow of Amazon.

It’ll be incumbent upon leaders to redefine “who we are” and why a new identity is important. This isn’t something to be taken lightly. In fact, it’s an extremely difficult challenge to reshape one’s personal belief system. Just imagine, as an Amazon or Whole Foods employee, everything by which you’ve defined yourself—the beliefs, values, how work gets accomplished—are going to change. At the very least, they’ll be challenged. This is a difficult concept to grasp let alone accept.

Communicating this new message will require two things: clarity and consistency. The message must be clear as to why things (i.e. culture, work processes) are changing because when people know why, they feel like they're part of the solution. Of course repetition is the mother of all learning so reinforcing this message consistently is the other piece of the puzzle. And I don’t mean hosting an all-hands every once-upon-a-time. A message of change and “newness” must be conveyed every day, in every meeting, and with each directive. Like I said, change isn’t easy.

Existing businesses who don’t proactively adapt to change will get bulldozed for those that will. It’s that simple. In today’s competitive environment, it’s the companies who willingly adapt to change who stay relevant.

https://www.forbes.com/sites/jeffboss/2017/06/20/amazons-competitive-advantage-isnt-cost-or-convenience-its-this/#326649d04958

Answer 1

1.

Brief summary of the article:

The article speaks about the competitive advantages, the way they have shaped with changing times and how organisations work to keep those competitive advantages intact and stay relevant. Some of the key highlights are:

• It tells us how tradition attributes like cost and prices are no more competitive advantage.
• The article also contains brief on journey of various tech giants like google, Facebook. Telling about what they started with and how they evolved.
• Then it talked about the team work culture and effect of cross functional teams on development of employee and organisation in large.
• It used the amazon acquisition example to explain the importance of handling people’s beliefs and developing new narrative.
• In the end the articles uses these examples to put a point that adaptability of the organisation is now the key to preserve the competitive advantage and stay relevant.

2.

Connection to building competitive advantage:

For the most of it parts the article speaks about competitive advantages. It has given various examples to show how constant change and innovation is the key to stay competitive and relevant. Article shows that to keep your competitive advantage an organisation needs to be adaptive in the following sense

• By leveraging the core competence of the organisation to create new avenues for competitive advantages.( like evolution of google from a search engine to a giant)
• In keeping their culture and people relevant to the present scenarios. (Using cross function teams or establishing a new narrative after mergers and acquisitions).

Contradiction to Five forces model assumption:

• The three key assumptions of five forces model are:
  • No interaction between buyers, competitors, and suppliers.
  • That the source of value is structural advantage (creating barriers to entry).
  • That uncertainty is low, allowing participants in a market to plan for and respond to changes in competitive behaviour
• The article clearly talks about how the structural advantages have become redundant in creating competitive advantage, especially after growth of internet and ecommerce.
• The exponential rate with which technology is growing and the pace with companies are adapting new disrupting technologies , has made the market very high on uncertainty and tough to develop reactive strategies.

How others can learn:

The rise and fall of nokia is the classical example that supports this article. Nokia being unwilling to adapt the new technologies (android), almost became irrelevant to mobile phone industry from being a market leader once. So this article provides a basic over view of how a company like nokia should access the current situation and adapt accordingly.