The following is an excerpt from Ian McCarthy’s blog entitled It Depends:

Competitive advantages are temporary, especially in fast changing industries. A cover of Business Week magazine asks “Is Your Company Fast Enough?”, and there are scores of popular business books and magazines with titles such as “Fast Company”, “Business @ the Speed of Thought”, and “The Age of Speed”. Such publications suggest that in fast moving industry environments, speed, and in particular being fast, is an important factor in the creation and erosion of competitive advantage.

In an article entitled “A Multidimensional Conceptualization of Environmental Velocity”, that I authored with colleagues Thomas Lawrence, Brian Wixted, and Brian Gordon, we present a framework that dispels this notion that speed always leads to business success.

We explain that to simply characterize business environments as fast-changing or highly dynamic, is to overlook the fact that the velocity of an industry – its rate and direction of change  – is composed of multiple factors, each with a distinct velocity of its own. These factors, or industry dimensions as we call them, include: technologies, products, competitors, demand and regulations. It is rare for an industry to be uniformly high-velocity in nature (i.e. all dimensions are changing rapidly and discontinuously). Instead, businesses typically face what we call “velocity regimes”, patterns of multiple velocities of all the different dimensions involved.

To read more about Rethinking Industry Dynamics, visit Ian McCarthy’s blog It Depends.