Abstract
Fashion reflects changes in socio-economic and cultural life which, in turn, changes fashion, and apparel boosts such change. Thus, in response to a shift in people’s preferences from economic functionality to supra-functionality beyond an economic value, the fashion industry has been gaining momentum worldwide. In the digital economy, the fashion industry is in the midst of global dynamic change stimulating volatility, velocity, variety and dynamism, which necessitate a digital solution. Digital business leader Amazon has succeeded in constructing an R&D-driven disruptive businesss model. This can be attributed to a virtuous cycle among user-driven innovation, advancement of the Internet, co-emergence of soft innovation resources, and activation of a self-propagating function leading to supra-functionality satisfying user preferences. Given a timely digital solution, the fashion industry reinforces this cycle which, in turn, advances the solution. Thus, broad stakeholder involvement betting on a higher level of R&D expecting the future prospects of the industry can be expected. Based on a co-evolution analysis of the development trajectories of Amazon and the fashion industry, an insightful suggestion paving the way to stakeholder capitalism, essential for global business leaders, is thus provided.
Highlights
Fashion reflects the change in aesthetic, economic, political, cultural, and social life[1]
The emergence of the sharing economy and its rapid shift accelerated by the digital economy have provided significant impacts on fashion leading to the shift to new ownership models driven by growing consumer desire for variety, sustainability and affordability
International Journal of Managing Information Technology (IJMIT) Vol.12, No.2, May 2020 While this system depends on the assimilation capacity of soft innovation resources, Amazon has developed a high level of capacity, supported by a rapid and notable increase in R&D investment
Summary
Fashion reflects the change in aesthetic, economic, political, cultural, and social life[1]. Digital business leader Amazon has succeeded in constructing a sophisticated R&Ddriven disruptive business model transforming its core investment, R&D into a new concept of R&D [11, 12] This success can be attributed to a virtuous cycle among user-driven innovation, advancement of the Internet, co-emergence of soft innovation resources, and activation of a self-propagating function that induced functionality development, leading to supra-functionality beyond an economic value that satisfies a shift in users’ preferences [13]. Amazon has been endeavoring to frontier innovation and companywide experimentation, thereby develops its growing empire and subsequent big data collection system enabling it harnessing the power of users which function as a virtuous cycle leading to the transformation of “routine or periodic alterations” into “significant improvement” during R&D process This has been enabled by fusing unique R&D system and a sophisticated financing system centered on cash conversion cycle (CCC) driven free cash flow management.
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