Sunday, April 15, 2007

Using Technology for Competitive Differentiation

Recently I was talking to the client regarding the use of web 2.0 technologies in the eCommerce Portal.

Immediately, the client asked me to list down the business value the client would get by using those technologies.

This has always been the case. Whenever new technologies need to be used in the solution, there is always a question towards BVI. Business Value Index.

My point is that if new technologies are used for competitive differentiation, How long is it going to take for other companies to replicate the same thing?

If we go by BVI, its always possible for the competitor to use the same new technologies innovatively to beat / bring a new competetive differentiation.

Anything that is measurable / quantifiable in benefits is 'repeatable' too. It obviates the competive differerentiation in medium/longer term.

So what is the solution?. The solution is to look for technologies that would build intangible benefits...

Sounding little ambiguous...?..that is how it is..! We cannot measure the benefits like customer loyalty, user experience, brand value, accessability/usability. But these are the key drivers that make a solution unique.

Although its possible to put together a framework around these intangibe benefits to make them quantifiable, the metrics will not be accurate as other tangible benefits like performance, availability, scalability, etc.

But, inherently, the technologies themselves will not be directly addressing these intangible benefits. It is the method/way in which those technologies are used for a particular customer and problem context will determine those benefits and make the solution unique and 'non repeatable'.

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