Strategic Priorities in the Digital Era

Abstract This chapter examines how digitalization influences companies’ pursuit of competitive advantage. The chapter makes the case that the creation and use of data has led companies across diverse industries to embrace three broad strategic priorities, using data for: (1) constant optimizing, (2) experimenting to diversify to new products and services, and (3) building interactive digital relationships with customers, suppliers, and partners. While these priorities are not unique to data-savvy corporations, they benefit directly from real-time data and smart automation. As digitalization often erodes firms’ ability to exploit unique resources or capabilities for sustained profits over time, they pursue greater agility and innovativeness. To accomplish this, companies invest in digital infrastructures that enable them to identify and react to environmental changes more rapidly.