NEW RULES OF COMPETITIONIN A SUSTAINABLE AND

INTERDEPENDENT WORLD

PROF. MICHAEL R. CZINKOTAGEORGETOWN UNIVERSITYBlog: michaelczinkota.com

Richmond, May 2, 2011

Environment, Conservation and Sustainability

• Growth will speed up the depletion of natural resources

• Global shortage of important raw materials

• Global shortage of potable water

• Varying concern for the environment

Environment, Conservation and Sustainability

• Concern about climate change

• Saving energy and limiting energy use

• Green investments and carbon credits trade

• Key sectors for industry expansion

New Rules of Competition

• Information Technology Disintermediates

But: Creates New Markets and Products

New Rules of Competition

• Presence in all Markets

from marketplace to market space

Customer ReachCost of Distance

Supply Chain ManagementProduct Sourcing

Employment Sourcing

But: Products Still Need to Get There

But: We Define the Class

New Rules of Competition

• Only Best in Class Projects

But: Takes Special Efforts

New Rules of Competition

• Only Best in Class Projects– Compensated by Leadership Premium

New Rules of Competition

• Understanding Effects of Change

But: Appreciate Magnifications

New Rules of Competition

• Focus on Process Thinking

But: Bring Processes to People

Ownership

Use

Payment FlowsPayment Flows

Distribution StructureDistribution Structure

Product Life CycleProduct Life Cycle

New Rules of Competition

• From Ownership to Use

But: Compensate for Use

Key Growth Industries

1.Communications/IT100

2.Servicing Seniors 84

3.Pharma/biotech 72

4.Environmental 66

5.Energy 55

New Strategies

• Mass Customization– Service based competition–Cross-selling efforts

• Bundling–Customers expect a package–New plateau of customer satisfaction

New Strategies

• Revenue Re-streaming–Payment tracking–Direct interaction

• Knowledge transfer–Creating an innovation memory– Irresistible functionality

Global Success

The most criti cal business functi ons for global success

1. Logisti cs 1002. Marketi ng 863. Human Resources 714. Finance 575. Communicati on 34

The most criti cal business functi ons for global success

1. Logisti cs 1002. Marketi ng 863. Human Resources 714. Finance 575. Communicati on 34

The Bottom Line: Freedom

• Not being forced to do something unwillingly (Hayek)

• Choice – but stepping into the ring • Beyond boundaries• Together we can progress• Alignment of values – societal fit• Human excellence and happiness

(Thomas Aquinas)

Thank You Very Muchfor Your Attention

and now on to comments by Ms. Adrienne Withaker

ofSunTrust