Sustainable Competitive Advantage
by KATIA SOVA | 2022, October 14
Discussing sustainable competitive advantage, we investigate company characteristics that are difficult to repeat, replace, or reframe. It can apply to any aspect of the business: product, marketing, production, strategy, etc.
A sustainable competitive advantage negates the power of offering the products first in the market or occupying the best location, as the nature such of advantages is temporary (Lipovich, 2020). Industry experiences an emerging shift from physical to cognitive competition to take a prominent role in the market.
The Information Systems concept represents the cognitive zone, where components share roles equally for business development as it pictures in Figure 1.
Figure 1
Information System Components
Figure 2 shows changes when technology boosts sustainable effect in the competitive scope.
Figure 2
Sustainable Competitive Advantage
Such, the crux of sustainability in business is mainly a composite of software, plus a component or two of the information systems.
Moore’s Law Implication
Moore’s law has been valid for the last 57 years and represents a constant pattern in which the speed of computing doubles every two years, and this process is proportional to the dynamics of cost drop over the same period:
| 2/1 speed | 2 years | 1/2 cos t |
Nowadays, competitive advantage often correlates with software (pic.2), while Moore’s Law initially refers to hardware. What if Moore’s law’s implication in a sustainable edge lies between these two tech components?
Moore’s Law takes on a new perspective, replacing the speed-to-cost relationship with a capability-to-size relationship. The key aspect is a combination of hardware and software to make processes automated and “do more with less” (Gharibian-Saki, 2022).
Moore’s Law affects competition. The advantage’s life cycle has been decreasing (periodically halving?). The gap between today’s and tomorrow’s IT Infrastructure is expanding so fast that when a business does not jump on this train today, it automatically loses the opportunity to get such an advantage in the upcoming years (a couple of years?).
On the flip side, companies that leverage the technology advantage multiply (double?) their chances of keeping the edge (for the next two years?).
Moore’s Law has strategic significance in business planning and budgeting (Thompson, n.d.). Meanwhile, with quantum computing and nano-biotechnology growth, Moore’s Law may lose its relevance, as technology tends to evolve exponentially (Shein, 2020).
Conclusion
Technology advantage, software and hardware, is mainly a synonym for a sustainable edge over rivals. The second pillar of long-term objectives is information (data). People are the third one, for they navigate the tech processes to make data-backed decisions.
Moore’s Law reflects the effectiveness IT infrastructure as it is a powerful key to developing beneficial speed-cost, capability-size ratio, and the almost only opportunity to sustainable leadership.
References
Gharibian-Saki, D. (2022, July 02). What does Moore’s Law mean for business? Redwood.
https://www.redwood.com/article/what-does-moore-s-law-mean-for-business/
Lipovich, I. (2020, October 6). How to use technology to gain a sustainable competitive
advantage. Forbes. https://www.forbes.com/sites/forbesbusinesscouncil/2020/10/06/how-to-use-technology-to-gain-a-sustainable-competitive-advantage/?sh=276c62fc328c
Shein, E. (2020, April 17). Moore’s Law turns 55: Is it still relevant? TechRepublic.
https://www.techrepublic.com/article/moores-law-turns-55-is-it-still-relevant/
Thompson, S. (n.d.). Moore’s Law and how It pertains to business. Chron.
https://smallbusiness.chron.com/moores-law-pertains-business-75824.html
