We are in a time of great change. I suppose that’s obvious. Post 9/11, there’s been much commentary about these uncertain times. Whatever side of the political aisle you are on, you can likely agree that environmental concerns, “terrorism,” war, and other big issues cause us to live in uncertain times. Institutions, much beloved for decades, are seen with some distrust. Journalism, once depicted by Thomas Carlyle as the “fourth estate” so important to democracy, is now one of the most disliked institutions, with a trust level below that of used car sales persons.
Tag Archives | strategy
If your business is targeted by a larger competitor, the natural response is to want to play defense–to squeeze pricing, take special care of the channel, maybe do some promotions and guerrilla marketing. We’d never advise you to take your eye off a competitor, but the defensive reaction isn’t always the best way to fight. A larger competitor will expect you to do these things, and will usually be well prepared for siege warfare. They’ll be ready to match your pricing and outspend you in the channel in order to drive you out of the market.
Sometimes the best defense isn’t defending at all, it’s finding ways to grow the market. If your customers are still early in the adoption curve, and especially if there are new segments you can open up, it’s usually more cost-effective for you to bring in new users than it is to defend every inch of the turf you hold today.
SME / SMB’s–once the Holy Grail of the industry–appear to be a highly coveted group. Moving from being an enterprise player to play in the mid-market is incredibly challenging. We’ve worked with a few companies of late who have asked us to come in and help them achieve this new market summit. Having done this a bunch with some Silicon Valley blue chip names, I can see the common pitfalls they face and want to tell you how to avoid them.
This will probably sound crazy, but despite all the hype about Web 2.0 and web startups, the most common mistake we see tech companies making with regard to the web is underestimating its long-term impact on their businesses.
I’m not sure why this is. Maybe it’s a reaction to the Internet bubble — because the short-term effects of the web were oversold, people also tuned out the long-term effects. I know some companies are so settled in their current franchises that they don’t understand how vulnerable they are over time to the changes taking place in the marketplace. Others take the web very seriously in one respect, but don’t understand its full impact across their entire company.
To understand what the web is going to do to our businesses, you have to look at it as both an application development platform and a new communication medium. Either change alone would have huge impacts, but the two together are especially powerful. Here’s what we see happening in each area, followed by some ideas on what they mean for businesses.
From time to time in business, an idea emerges that sounds obviously good — so good, in fact, that it becomes accepted wisdom almost immediately. Product managers quickly incorporate it into their assumptions, marketeers let it shape the way they approach the project, and executives quickly incorporate it into their presentation slides so that it ceases to be mere idea and becomes… (drum roll) fact.
The idea makes the leap from theory to principle without ever being subjected to rigorous testing. Often, the idea eventually gets proven out. But what if the so-called fact turns out to be false? Or what if an idea that once was true becomes false? What happens then? Has it happened to you?
Before a company can be ready for growth, it must take stock of the current business situation–and make those decisions that will prompt sales expansion in the future. Making the decisions for what to cut, what to keep and what needs further investment is a key part of strategy development. This approach can be applied to your product lines, market segments, and resource allocation.