Analyzing the Impact of Product Evolution
Emergence of the new technological solutions such as software, microchips, bioengineering, nanotechnology resulted in higher emphasis being placed on pharmaceuticals, ICTs, and other high tech industries. At the same time, low tech sectors have also greatly evolved over time. For instance, the Portuguese footwear industry has gone through restructuring process in the 1990s: creative use of micro electronics has been introduced. As a result of this innovation, industry managed to expand despite the raising labor costs. Bioengineering is being widely used in the wine industry through fermentation techniques that enhance quality of wine. Bacteria biotechnology renewed the classic cork technology used traditionally for centuries.
In all of these cases, industry had to adjust to the new technological solutions. Companies that employed new approaches successfully retained and increased their market share, whereas traditional companies have been forced out of business. It should be pointed out that the restructuring process had significant impact on company organizational and business strategies that had to be adjusted accordingly.
Undoubtedly, Schumpeterian theory had a great impact on the current business strategies. The major lesson to be learned by the companies in business is that innovation can be transferred into a sustainable competitive advantage that cannot be easily followed by other competitors in the industry. As such, businesses must remain open minded and develop adaptive capabilities. The theory of “Peter” still remains the milestone of business practices, as the essentials for gaining and treating innovation remain unchanged – business must gain knowledge to create and sustain competitive advantage.
Learning organization – is the direct implication of the Schumpeterian’s “gales of creative destruction”. People in a learning organization must continually expand their capacity to create the results they aim at. Only under this condition organizations are able to adjust to the situations of rapid change: flexibility and productivity. There are five basic steps that distinguish learning organization from the traditional ones: personal mastery, systems thinking, mental model, building shared vision, and team learning. Combined implementation of these five basic steps allows companies to respond to the emerging changes in business environment and turn innovation into a competitive advantage.
Innovation is a continuous process that cannot be controlled or predicted with a certain degree of verifiability. In order for organizations to survive in the dynamic 21st century, they must remain flexible and enhance learning at all stages. Learning organization is the key to a strong position in the dynamic market place.
About the Author
Jennifer Burns is a professional freelance academic writer at Custom-Writing.org, essay service. Jennifer specializes in academic paper and paper proofreading.
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