The way people define industries is really quite interesting. I’ve once again been asked to be a judge for the Harvard Business School New Venture Competition. They asked what industries I’m comfortable commenting on. It’s a surprisingly hard question to answer, because it’s quite unclear what an “industry” is. Here are a sample of a few things that people call industries:
- B2C internet
- B2B internet
- Health Care
- Medical Devices
- Financial Services
What makes these an industry? Is it that all members of the same industry share the same markets? Is it that all members of the same industry share the same employee skill sets? Is it that all members of the same industry produce the same kind of products?
Every definition I’ve tried has glaring exceptions, which makes me wonder whether thinking in terms of “industries” really makes as much sense as I’ve always assumed.
Perhaps it makes more sense to think in terms of:
- companies/products who serve a given market
- companies/products that require certain kinds of distribution
- companies/products that require certain specialized knowledge on the part of employees
What do you think?