As customer needs change, so do the areas where companies compete

What business are you in?

What business are you in?


of CEOs think competition will increasingly come from other sectors or sub-sectors

CEO interview quotes

“I think you've got to look at the disrupters and see what you can learn from them, because they often come in with some very smart innovation and different service propositions... So I see disrupters as part of how we make sense of how we evolve as a business.”
“I think we have to be very mindful that the boundaries between industries are blurring. And… again we should not be too fixated in any way on looking at one's traditional markets or traditional competitors, but looking forward at new opportunities.”
“The markets are always changing, and it’s a great time to be listening, learning, figuring out what problems are unsolved with customers, because there are always emergent problems. And that’s how you win.”
“The big issue around competition is about ourselves and facing our customers on a daily basis and being with them and moving and changing with them. When you don’t do that, you leave it for other parties to come in.”
“In the past, competition was only within sector. Entry to (the) banking sector was highly costly and almost impossible. However, digital dynamics began to undermine barriers to entry. In this respect, competitors may emerge from any industry…”
“There have been few fundamental innovations since ready-made cigarettes took over from pipes and cigars 100 years ago. Now, suddenly, the industry is being forced beyond its historic comfort zone, and that’s usually good for consumers.”
“I think that the successful companies of tomorrow are the ones that see new value, new business models… in disrupting the way things used to be. And beyond that, also identifying completely new kinds of ways to connect supply to demand, to connect value – to bring value to build networks.”
“...while our businesses are different from their end products, there is a common core around highly engineered, customised applications to solve our customers’ most critical problems ... We use our collective know‑how and our bold thinking across the company to create a powerful set of solutions to problems that exist.”

Key findings

Customers today defy classic notions of what drives their purchasing decisions. Competing within traditionally defined demographic segments, channels, product/service offerings, geographies or industries increasingly doesn’t work. Customer relationships are now much more fluid: they’re moving from one-off transactions toward broader and longer-term experiences that can span different product and service offerings, channels, countries and sectors.

That’s leading CEOs to take a more flexible view of what business they’re really in. Companies are increasingly focused on customer problems, and looking at how the organisational capabilities that differentiate them can be used in cross-disciplinary ways to solve those problems. That’s taking businesses into adjacent – and sometimes completely new – sectors. More than half (56%) of CEOs think it likely that companies will increasingly compete in new industries over the next three years. Three in ten have entered a new sector or sub-sector in the past three years; and 21% have considered doing so.

CEOs need to develop a few key capabilities to succeed. Navigating their way through new competitive landscapes will require a simple but committed concentration on doing what they do best. Drawing on their differentiating capabilities, they will then need to create new value in new ways through digital transformation, developing diverse and dynamic partnerships and finding different ways of thinking and working. The companies that can effectively combine these highly interdependent approaches around simple yet powerful value propositions will be positioned as winners in the new competitive landscape.

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