Blog Yes & Know

Strategy in a Downturn

Here’s a rule of thumb: During good times people think it is their strategy that’s good, and in bad times, people think it’s the market.
During a downturn, many executives are much more likely to think a redirect is necessary. In a similar fashion, during times of great growth, we assume that what we’re doing is causing the desired results so staying the course makes sense. Neither point of view is really true. They reflect our perception of what we believe to be true.

Piracy and Revenue Optimization

A winning business model requires a unified and all-encompassing approach that goes far beyond how monies are collected and products or services are delivered. In an earlier article, I mentioned a long list of functional areas that must align around a winning business model, but neglected to include Legal. How the legal eagles affect business models is critical and deserves an article of its own. That’s right–even the legal team is part of a winning business model.

Better than Free

Kevin Kelly has a thought-provoking post on what adds real value in an Internet-centric world. He likens the Internet to a giant copy machine. If books, music, even ideas, can be freely copied so that they are free, where will value reside. To answer the question, he lays out eight “generatives”–or things that cannot be copied, and thus remain valuable. Read the whole thing.

Listen to the Oppressed

We listen to the rich, but we need to learn to listen to the oppressed. The voices that are often not heard are the ones that can add a dimension to a growth strategy that can’t be found at the top of the organization. It’s not glamorous and it likely won’t make it into the PPT slide that goes to the CEO or to the Board. It will however make a difference in how that strategy actually becomes reality. And you’ve heard me say it before. A strategy not made into reality is just a set of theoretical slides. Strategy has to be about the outcomes that are created.

Amen, Brother

“Don’t envy your competitors; this has done more for hurting AMD than anything Intel could do to us.”

Pricing as a Head Trip

Can prices be set too low for consumers? A recent study by Dr. Antonio Rangel of CalTech says yes. Dr. Rangel observed the brain activity of subjects and found they exhibited more pleasure drinking wines when they thought they cost more. For those of us that study the finer points of pricing, this is a very interesting result. We all know that there is a sense to “you get what you pay for” that acts as a negative factor when evaluating the lowest priced alternatives. What Dr. Rangel has established is that there is more than the fear of getting stuck with an inferior product at work; people actually get more enjoyment from certain products if they think they cost more. The data communicated by the price is working not just at a rational level, but at an emotional level as well. That is, from the brain’s standpoint, these products are objectively better in a post-purchase environment.

What was Ford’s Alan Mulally thinking?

Unless you are selling talking beer openers or donuts, comparing your product to Homer Simpson defies conventional wisdom. When your product is a slow-selling car, your actions are certain to leave people saying, “D’oh!”
Yet, this is exactly what Ford Motor CEO Alan Mulally did recently. He wasn’t subtle, in a public speech he projected an image of Homer over a picture of Ford’s Taurus sedan while being critical of the design and talking up future models as much better. We can be pretty sure that this will not rally sales of the Taurus over the coming months, so has Mulally gone mad or is he actually smart?

What is this Strategy thing?

Because all the “right” strategies in the world could be applied to any business but what makes it right for them is really about leveraging their core strengths today. So it’s about discernment certainly to figure out what is a company’s strength today. And what are they clearly not able to do. And then to look at that clearly, without bias to think about what makes sense. I suppose in some way it’s the role of a parent to a child or a teacher to a student. The parent or teacher sees things the child or student doesn’t. Not because the child is stupid or the student ignorant, but both are learning and are too close to the situation themselves to have some perspective of what true gifts / strengths / abilities they should place their leverage.

Winning Business Models: Innovation vs. Invention

Invention is the classic way to build a successful company. However, invention is much harder for a mature company or a mature technology. Business model innovation is an attractive option in many cases as a way to differentiate an offer, improve profitability or both. Below are five emerging business models.