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October 12, 2020

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By breaking the rules of the game and thinking of new ways to compete, a company can strategically redefine its business and catch its bigger competitors off guard The trick is not to play the game better than the competition but to develop and play an altogether different game. Probability of a first ranked firm in a particular industry surviving in first place is about 96 percent — almost a certainty.' For the second-ranked firm, the probability of survival is 91 % The key is strategic innovation Significant shifts in market share ;ind fortunes occur not because companies try to play the game better than die competition but because they change the rules of the game. Canon, on the other hand, decided to play the game differently. It segmented the market by end tiser and tainted small and medium-sized businesses, while also producing personal copiers for individuals. Canon also decided to sell its machines otitright through a dealer network, and, while Xerox emphasized the speed of its machines, it concentrated on quality and price as its differentiating features. IBM focused on quality but APPLE focused on the market

Chapter: Strategic innovation

Strategic innovation

1. The strategy of breaking the rules is not new. Nor is it something that has suddenly become important because of a more demanding competitive environment. 2. Breaking the rules is oneway to play the game. All firms should not adopt it, and they should not adopt it all the time 3. How to break the mles depends on the basiness that the firm is in as well as the firm's strengths and weaknesses 4. The strategy is, by definition, risky. Yet a company can manage the risk, primarily by experimenting in a limited way or limited area before flilly adopting the new strategy 5. Coming up with new ideas does not guarantee success. It's one thing to think of a new idea but another to make it work. The whole organization must be managed appropriately to give the new strategy a chance. Who is going to be our customer? What products or services should we offer the chosen customer? How should we offer these products or services cost efficiendy?'

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October 12, 2020

(1) new, emerging ctistomer segments or existing customer segments that other competitors have neglected; (2) new, emerging customer needs or existing customer needs not served well by other competitors; and (3) new ways of producing, delivering, or distributing existing or new products or services to existing or new customer segments. 1. Redefine the business. 2. Redefine the who. Who is otir customer? A company should think of new ctistomers or new customer segments and develop a game plan that serves them better. 3. Redefine the what What products or services are we offering these customers? A company should think of new customer needs or wants and develop a game plan that bener satisfies these needs. 4. Redefine the how. Companies shotild leverage existing core competencies to build new prodticts or a better way of doing business and then find the right customers. 5. Start the thinking process at different points. Perhaps a company's most dominant mental model is its perception of what business it is in My research su^ests that successful strategic innovators all follow very different tactics from those of every other competitor in the industry

Chapter: Strategic innovation

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If a company starts playing the game in a totally different way from everyone else, the reason may be that it is playing a different game altogether. Redefine the how; share core competencies, reuse competencies, expand competencies,

The business model concept offers strategists a fresh way to consider their options in uncertain, fast-moving and unpredictable environments. In contrast to conventional assumptions, recognizing that more new business models are both feasible and actionable than ever before is creating unprecedented opportunities for today's organizations. However, unlike conventional strategies that emphasize analysis, strategies that aim to discover and exploit new models must engage in significant experimentation and learning – a ‘discovery driven,’ rather than analytical approach.

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October 12, 2020

Chapter: Strategic innovation

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