In best markets, when a company provides a brand new profit, others will rapidly transfer to match it.
Which means it’s onerous to justify the onerous work of making one thing higher, as a result of it’s simply going to grow to be a brand new customary. It doesn’t pay for a bank card firm to spend money on customer support, the considering goes, as a result of that gained’t pay for itself, it’ll simply elevate prices for the chief and for all of its opponents. That’s how the race to the underside begins.
Maybe it pays to easily deal with being higher at making a revenue, or being higher at getting new clients, or being higher at making the inventory worth go up. These proxies push short-term considering and aren’t resilient.
What actually adjustments the sport is when a company decides to decide to being higher at being higher.
That’s onerous to do and troublesome to compete in opposition to.