I finally got to read Funky Business (2000) and Karaoke Capitalism (2004) by Jonas Ridderstrale and Kjell Nordstrom, two Swedish economists, affiliated with the Stockholm School of Economics. Having enjoyed Funky Business a lot, I needed less than 2 days to read through Karaoke Capitalism (295 pages). And yes, it's not uncommon for me to spend my weekends like that...
One of Ridderstrale and Nordstrom's theses is that the best thing companies can do in near-perfect markets where total competition rules is to strive for so-called 'temporary monopolies'. These monopolies are based on emotions and imagination; the authors speak about E(motional) competitiveness. In this reality "[c]ompetitive strategy is the road to nowhere. We need to create sensational strategies. Sensational strategies capture the attention of the people with whom we want to do business. Sensational strategies appeal to all five senses of man. They embrace our emotions. Competitive strategy means being one step ahead. Sensational strategy is about playing a different game." (p.267).
There are supposed to be two sensational strategies, one based on ethics and the other based on aesthetics. Companies like the Body Shop and Toyota that follow the ethics route stand for something and everyone and everything at the company is guided by it. The second sensational strategy is based on aesthetics. As it becomes harder and harder to differentiate products and services and everything is more or less the same, products' and services' exterior appearance becomes the basis for competition. The incredible success of Apple's iPod and other 'eye candy' like the iMac and its Mac OS X user interface seem to support this claim. In a sense it is also related to what others have come to call the 'Experience Economy'. Besides playing to consumers' reason, companies should also address their affection, intuition and desire (RAID).
Design is obviously becoming a competitive weapon. BusinessWeek first wrote about this in its May 17, 2004 issue (The Power of Design, p.68-75), and more recently it published a Special Report on the Creative Company (August 8/15, 2005, p.51-69). Both articles come highly recommended.
One of Ridderstrale and Nordstrom's theses is that the best thing companies can do in near-perfect markets where total competition rules is to strive for so-called 'temporary monopolies'. These monopolies are based on emotions and imagination; the authors speak about E(motional) competitiveness. In this reality "[c]ompetitive strategy is the road to nowhere. We need to create sensational strategies. Sensational strategies capture the attention of the people with whom we want to do business. Sensational strategies appeal to all five senses of man. They embrace our emotions. Competitive strategy means being one step ahead. Sensational strategy is about playing a different game." (p.267).
There are supposed to be two sensational strategies, one based on ethics and the other based on aesthetics. Companies like the Body Shop and Toyota that follow the ethics route stand for something and everyone and everything at the company is guided by it. The second sensational strategy is based on aesthetics. As it becomes harder and harder to differentiate products and services and everything is more or less the same, products' and services' exterior appearance becomes the basis for competition. The incredible success of Apple's iPod and other 'eye candy' like the iMac and its Mac OS X user interface seem to support this claim. In a sense it is also related to what others have come to call the 'Experience Economy'. Besides playing to consumers' reason, companies should also address their affection, intuition and desire (RAID).
Design is obviously becoming a competitive weapon. BusinessWeek first wrote about this in its May 17, 2004 issue (The Power of Design, p.68-75), and more recently it published a Special Report on the Creative Company (August 8/15, 2005, p.51-69). Both articles come highly recommended.
