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Increasing Returns and the New World of Business Presented by: Alexandra Mezhenina Vladimir Fedotov Yaroslav Pavlov By W. Brain Arthur
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New reality of economy Transformation from application of raw energy to application of ideas, from resources to information
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Two economical worlds World of diminishing returns World of increasing returns
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Diminishing-returns world Commodities production depends heavily on resources and lightly on know-how Diminishing returns and nearly perfect competition Still exists in modern economy in bulk processing
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Increasing-returns world New rules of the game Market became unstable, unpredictable…
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The reasons of this phenomena Up-front cost Network effects Customer groove-in
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Factors of new system Flat hierarchy, mission orientation, flexibility in strategy… Because: adaptation never stops every participant of the process becomes very important
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Playing the high-tech casino Discount strategy Psychological positioning Cross-company mutual feedback
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Increasing returns in service-industries Services can also be described in terms of this phenomena Two consequences: A lot of small companies concentrated on one service Winner-take-most
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Managing two economical worlds Do I understand the feedback in my market? Which ecologies I am in? Do I have resources to play? What games are coming next?
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Thank you! Comments Questions yaroslav.pavlov@gmail.comyaroslav.pavlov@gmail.com - Yaroslav Pavlov sasha.gsom@gmail.comsasha.gsom@gmail.com - Alexandra Mezhenina vaavilen@yandex.ruvaavilen@yandex.ru - Vladimir Fedotov
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