There’s a common expression that every successful business should live by: “adapt or die”. The business world is always changing. And if you don’t recognize the changes and tailor your business strategy, your business will suffer and inevitably fail.
Every successful company has some form of a competitive advantage whether it be a prime location, a specific demographic appeal, all-star employees, unique marketing or even a very specific product feature. There is one competitive advantage I want to talk about. It is sweeping the nation and causing disruption in every industry. Companies without this competitive advantage are losing market share and losing it fast. The competitive advantage I’m talking about is Software.
Software is becoming one of the largest competitive advantages there is. More and more successful businesses are emerging that are literally running on software and deliver to their customers through the internet. Software companies are eating up market share in every major industry. We are witnessing a massive, dramatic shift in both the economic and technological landscape. Look around!
A great example of this trend is a company that has been splashed all over the media recently: Uber. The taxi business will never be the same...ever! Uber has transformed the game. They have remodeled a very antiquated system by utilizing mobile software and have created a business model that is unstoppable. In a matter of a few short years, Uber has gobbled up a vast percentage of market share that long-standing companies had been fighting over for decades. Now, Uber brings in approximately $20 million a week!
Do you remember a company named Blockbuster? That little ole company used to have 60,000 employees and more than 9,000 stores. Then a couple small startups came around: Netflix and Redbox. Almost overnight, these two startups ripped the market share away from the intimidating market giant Blockbuster. Why? Because Netflix and Redbox offered software solutions that dramatically changed how people could watch movies. Netflix now brings in $3.6 billion a year in revenue. And just imagine, Blockbuster had the opportunity to buy Netflix for $50 million back in 2000 - that decision resulted in their demise.
Another massive web software splash was Apple in the music industry - remember the world before iTunes when we had to purchase CDs? Since the peak, CD album sales have dropped 73% (most sales now consist of used CDs). This is an unbelievable number when you are talking about a multi-billion dollar industry.
Amazon is another tremendously successful company utilizing the power of software to transform the retail industry as a whole. Every industry has felt the threatening tug of market share from Amazon. They have expertly crafted a business process that leverages outstanding software to bring outstanding products and experiences to their customers. Amazon is known for investing in technology to constantly improve its business model - just look at what they are trying to do for the delivery industry with Prime Air.
Some companies to look out for are startups like Nest and SmartThings. These two startups are creating quite a commotion in the home automation industry. Nest has taken a simple thermostat found in most traditional American homes and have made it into a fantastic product that people are raving over. Who would have ever thought a thermostat could be cool (except in the literal sense)?
The concept behind SmartThings is to connect you with your home by allowing the devices within it to communicate with one another creating a seamless living experience. Imagine your coffee maker knowing when you typically wake up and automatically starts brewing coffee or your music player knowing to turn on when you come home or your front door opening when only you arrive. The possibilities are unlimited and will dramatically change the home accessory industry.
Software is becoming the backbone of business. It is reshaping every industry - it is transforming the status quo and any business who is stuck in the past using their same business practices for decades will be gone in less than half a decade from now.
Soon every company will become a software company whether you like it or not.
The software developers of the world already know this and they are using it to their advantage. The problem is most people are blind to how these changes will affect them and their business. My recommendation - make software developers a part of your core team because they can transform your business in ways you haven’t thought of.
So you choose... adapt or die?