The Profit Zone: How Strategic Business Design Will Lead You to Tomorrow's Profits

As a firm becomes more experienced at manufacturing a product or delivering a service, its price per transaction decreases. A firm that specializes in the delivery of a particular product or service and has more experience in those transactions will be more profitable than a firm without

with the player who has the best business model, a model designed for customer relevance and high profitability.

reinventors think differently; they see things differently; they act differently. They start with the customer and work their way back. They start with the profit question (“Where will I be allowed to make a profit?”) and work their way back. They are constantly focused on how the profit zone is shifting. Where is it today? Where will it be tomorro

How can we really add value to the customer?

vigorous pursuit of market share is done at the expense of business design innovation.

You can trump cumulative experience with a low-cost business design, which makes the incumbent’s cumulative experience irrelevant.

help the customers in the difficult, expensive, or time-consuming areas of their process.

protect the profit stream that the business design has created against the corrosive effects

opportunities for entrepreneurs and newcomers to: • Decipher what customer priorities are being ignored (a clear link to the words in the left-hand column in Exhibit 2.4). • Invent a new business design that responds to those priorities. • Create a new profit zone with extraordinarily high profitability.