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1 eStrategy October 2000 [email protected] eStrategy -- Day 1 Inventing Marketspace for Internet Success Two Day Workshop October 2000 Stuart Henshall
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1
eStrategy October 2000
eStrategy -- Day 1
Inventing Marketspace for Internet Success
Two Day Workshop
October 2000
Stuart Henshall
4
eStrategy October 2000
Why eStrategy to invent the future?
• “No matter how good your product you are only 18 months away from failure.”
• “You can’t shrink yourself to greatness!”• “Good Strategy is always subversive.”• “Best Practice destroys companies and industries but still have
to do it.” • “Strategy as a Process of Discovery (rather than positioning)”• “It is no good sticking to your knitting if there is no demand for
sweaters.” • “Strategy is where to you want to go and how to get there.”• “Maximise knowledge creation / minimise risk.”
Gates, Peters, Hamel, Porter, Prahalad, Nalebuff
5
eStrategy October 2000
Discussion:Exploring Our Perspectives
How has your organization responded to the Internet?
Where are your current web initiatives concentrated? E.g. B2B, B2C, C2B, or C2C?
What new business model or net initiative do you find most interesting?
What is your core business in 5 years time?
6
eStrategy October 2000
Outline:Day One - Inventing New Marketspace
• Orient & Explore the Driving Forces• Changing Strategy Tools and Assessment• Assess New Models• Develop New Functionalities / Internet DNA
Day Two - New Opportunities for Wealth Creation
• New Roles for COMsumers• Synthesizing Emerging Business Issues• Scanning Agenda• Engaging the Organization
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eStrategy October 2000
“When new technologies disrupt entire industries, the worst thing you can do is stay close to your customers”
Clayton Christensen
“In the network economy, producing and consuming fuse into a single verb: prosuming”
Kevin Kelly
Not just technology but the power of:
disruptive ideas
9
eStrategy October 2000
Are common references more than just talk?
• Globalization• Intangibles • Netification • Atoms to Bits• Speed - Real-time - 24/7/365• Mass Customization
10
eStrategy October 2000
Discussion:Yes or No?
• Will the web reshape your marketplace?• Are new players most likely to re-shape your
competitive landscape?• Are your web initiatives a core business
function?• Will your organizational structure change
significantly?• Are you waiting for a web team to figure it out?
11
eStrategy October 2000
Evidence of real economic productivity in new processes?
Typical Bank Transaction - 60 times!
• Teller $1.25• Phone $.54• Atm $.24• Internet $.02Job application Health Care Co.
• Traditional $128.00• Internet $.06
Truly efficient companies, particularly in the first couple of waves of change, will be able to drive (overall) productivity at 20% - 40% per year.”
John Chambers - CiscoSept. 2000
12
eStrategy October 2000
Discussion:Amazon or E-bay?
• Where would you place money for the long term? Amazon or E-bay? Why?
• Will Amazon ever make a profit?
• What assets justify Amazon’s valuation?
13
eStrategy October 2000
Discussion: Driving Forces / Emerging Models
Driving Forces Emerging Models
14
eStrategy October 2000
Where is yourattention?
Evolution in eMarkets
• Markets• Industry• Business Models• Organizations• Individuals
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eStrategy October 2000
Starting points:
How quickly are new Internet models proliferating that expand the scope, scale and markets for information assets?
With exchange costs near zero how large is the opportunity for real-time information aggregation?
If Consumer data and knowledge become the most important resource in the knowledge economy, who will control it?
16
eStrategy October 2000
Many to OneC2B
Many to ManyC2C
One to Many B2C
End to EndB2B
Supply DrivenOld World
Customer - Led New World
2000 2010?
How will markets and approaches evolve? What will prevail?
17
eStrategy October 2000
What drivers are at work on Industry Structure?
Integration driven by:• Best practice in firm• Avoidance of intermediate
stage competition• Economies of co-ordination
Dis-integration driven by:• Best practice outside the firm• Rise of new entrants or new
technologies and business models.
• Falling costs of co-ordination
Where is the tipping point where all businesses become web-businesses?
18
eStrategy October 2000
How will knowledge types impact new economy business models?
• Knowledge that has been articulated and codified in words or numbers
• Can be retrieved from the tacit knowledge grid and transmitted relatively easily.
Explicit Knowledge
Tacit Knowledge
• Intuitions, perspectives, beliefs and values that result from experience
• Can best be communicated interpersonally through dialogue with use of metaphors
• The mindsets (or mental models of individuals and the collective mindsets of the organizational culture.
19
eStrategy October 2000
So many new ways to capture attention?
Upcoming Data Explosion
• GPS systems• Wireless• SMART things, things that think, SENSORS• Voice, voice activation• Wearable always on computing• Nano, manufacturing at the molecular level• Genomics and Bio-informatics
20
eStrategy October 2000
Competing for Knowledge
Co
mp
eti
ng
fo
r A
tte
nti
on
Many to OneC2B
Many to ManyC2C
One to Many B2C
End to EndB2B
Explicit
Transpare
ncy
Tacit
Trust
Demand DrivenIdea DrivenOpen / Facilitating
Closed/ MediatingProcess DrivenSupply Driven
New marketspace fueled by knowledge / global connectivity.
Different Knowledge Markets?•How is competitive space changing? What opportunities for codification and standards?•What’s the real worth of a datamine? How might new recipes be found?•How will consumers gain leverage in data markets?•Where are new forms of idea exchanges emerging?
21
eStrategy October 2000
Will new info aggregators rule?How quickly will your business become commoditized?
• lowest price / easy to switch• direct sourcing• transparent margins• informed customers• inventory eliminated• multiple model and feature
combinations• new functionality• scope vs scale• agents see www.botspot.com
• What % before current model breaks down? 10% now, 30%?
• Old value chain deconstructed, no meaning in old context!
• Profit a function of Innovation• Recombinant models?• New Alliances?
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eStrategy October 2000
Efficiencies& Standards
E-commerce changing traditional strategy approaches
EfficienciesConnectivityProcesses
Recipes
AggregationAgents / Bots
NavigatorsInfo-mediaries
Competing for Knowledge
Co
mp
eti
ng
fo
r A
tte
nti
on
Many to ManyC2C
One to Many B2C
Idea DrivenOpen / Facilitating
Explicit
Transpare
ncy
Tacit
Trust
Closed/ MediatingProcess Driven
Value
Optimization
Data Markets
Operatio
nal
Efficie
ncy
23
eStrategy October 2000
Changing Rules for Consumer Attention
• Open source movement • Competing for permission• 1 to 1 marketing - personalization • From killer website to web business• Markets are conversations
24
eStrategy October 2000
Emerging knowledge markets driven by new interactions
ConversationsFacilitated
Co-creation
CustomizationDatamines
CollaborativeFilters
Competing for Knowledge
Co
mp
eti
ng
fo
r A
tte
nti
on
Many to OneC2B
End to EndB2B
Idea DrivenOpen / Facilitating
Explicit
Transpare
ncy
Tacit
Trust
Closed/ MediatingProcess Driven
Real-tim
e
Functi
ons
Privacy /
Permission
Efficiencies& Standards
Data Markets
Datamines
Idea Exchanges
25
eStrategy October 2000
Competing for Knowledge
Co
mp
eti
ng
fo
r A
tte
nti
on
Many to OneC2B
Many to ManyC2C
One to Many B2C
End to EndB2B
Explicit
Transpare
ncy
Tacit
Trust
Demand DrivenIdea DrivenOpen / Facilitating
Closed/ MediatingProcess DrivenSupply Driven
Tomorrow’s attention?Are new
functionalities
coming from
here?
26
eStrategy October 2000
Changing approaches to market
• C2C / P2P• Real-time• Privacy / Permission• Value Optimization• Operational Efficiency
Customers
Product
Operational
Community
Market
Connectivity
27
eStrategy October 2000
Current Models and Tools
Learning Objectives:• How do you model your business? • Describe your planning system.• What’s in your strategy toolkit?• Overturning strategic assumptions!
28
eStrategy October 2000
Discussion: Starting Point Modeling the Business
• As a group select a business, either one you all use or one someone can represent.
• Using post-its, how would you model it? How and where is the value created? How are the components defined?
29
eStrategy October 2000
Traditional Strategy Assumptions and Themes• Industry Structure is a given• Differentiation within a
structure possible• Limited number of Strategic
Options• Stability of Industry
Structures• Barriers to Entry
70’s How do you Integrate?80’s How do you explain profits?90’s How do you root in competencies?00’s ? Create wealth in a Knowledge Economy?10’s ? Facilitate migration in ecological systems???? Did we see the underlying
patterns and assumptions?
30
eStrategy October 2000
Old Views of Strategy are dead!
• Industry Structure:• View tries to predict winners, using a
static view that if the structure is A then the profit is B. Helps to explain why winners are winners. (Porter)
• Guru Think: • Adapted from current excellent
companies and written into management books. (Hamel & Prahalad)
31
eStrategy October 2000
RealizedStrategy
IntendedStrategy
UnrealizedStrategy
Deliberate Strategy
Emergent Stra
tegy
Mintzberg thinking
32
eStrategy October 2000
Getting a flavor for eStrategy?
CK Prahalad-1999 • Theory of innovation and
discovery• Create a social architecture and
get individuals at the heart of the process
• Values give energy and enthusiasm to us all
• We need to develop communities of interest Continued searching for new sources of advantage
• Being unique. Creating wealth, reducing risk in new investments and use of manager’s time.
• Inventing new rules and new games.
• Inventing new market space
• Providing new functionality
• Creating new networks
• Stimulating new wealth creation
33
eStrategy October 2000
Why is e redefining strategy?
• Ecological• Emerging• Endless• Energetic• Engaging• Entertaining • Enveloping• Environmental
Discuss:• How does your
planning process work?
• Who? Participants?• Time? Frequency?• Resource allocations• Play?
34
eStrategy October 2000
Three challenges for the eStrategist
• Strategic opportunities are created by the spontaneous creation of new business models. (Strategies are solutions that deal with problems)
• Opportunities are created by industry transitions, but to understand transitions need to turn industries upside down.
• Stimulating growth that generates further learning by the network or whole system.
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eStrategy October 2000
Plus…. Most companies wreck their own strategies
• Sustaining a unique position requires trade-offs. Trade-offs are incompatibilities between positions that create the need for choice. – Providing more of A necessitates less of B– Serving Customer X well means not serving customer Y.
• Tradeoffs increase the cost of imitation and thwart competitors
Michael Porter
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eStrategy October 2000
And…..Change can be difficult.
• Beware of simple singular changes
• Activities are complementary when changes that increase the effectiveness of some activities in the group influence change to take place in others.
• Only a small % (<5%) of co’s do all three simultaneoulsly
Boundaries
Structures Processes
ImportanceUncertainty
ChangeRenewal
38
eStrategy October 2000
• Why do your customers buy from you, why don’t they go to a competitor, or make it (do it) themselves?
• Which competitor do you admire most? Why?• In what respects are you different? What is unique about you?• How do you justify your superiority claim?• How do you sustain your uniqueness? Why can’t competitors
not do the same thing and in that way compete away your competitive advantage?
• Where do you make your strategic investments, that allow you to maintain your distinctiveness?
Yesterday’s strategy questions:asked about a business
39
eStrategy October 2000
Changing concepts
• new economic networks• non-linear growth• more gives more • make virtuous circles• follow the free• anticipate the cheap• feed the web first• knowledge resources• the net wins• chaordic organisations• shifting boundaries of
loyalty and affiliation
40
eStrategy October 2000
Network Economics
• Exploit the “Network Effect
• Differentiate your information product
• Don’t overprotect your property.
• Lock-in Users (& Employees)
• Cooperate on Standards
• Five Key Rules• Shapiro & Varian
Data
Information
Knowledge
Wisdom
41
eStrategy October 2000
Changing Forms of Value Creation
Integrator (linear to market) P&G, Nestle, NZDB
Layer Player (horizontal resources) Temporary Employment Agency
Market Manager (e.g. portal) Sabre, Autobytel, Marshall Industries
Orchestrater (Knowledge Strategies) Nike, Sara Lee
42
eStrategy October 2000
Linking the Chain
Figure 1: Inter-enterprise Business Processes Enabled by E-Commerce Applications
http://www.firstmonday.org/issues/issue4_12/fingar/index.html
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eStrategy October 2000
Figure 7: Key Application Drivers for I-Marketshttp://www.firstmonday.org/issues/issue4_12/fingar/index.html
Integrating applications
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eStrategy October 2000
Source: www.actnet.com
Cisco Model: good/services, knowledge and intangibles
Flows &Influence
48
eStrategy October 2000
Discussion: Modeling II
• Reviewing your model, the Cisco and Swahney examples. Could new ways emerge to model your example?
• Reviewing your model what are the four or five functions that are most important? Why?
• Underlying structure? Influence?• What issues are emerging for how we should
begin to model our organizations?
49
eStrategy October 2000
New Models!
Learning Objectives• new models• functionalities• web taxonomies• client is server• swarms!• pricing / strategies / usability
52
eStrategy October 2000
How will I network?
New methods to share and distribute!
53
eStrategy October 2000
Species versus species
Fast Company August 2000
• New competitive landscape
• Genetic structure
• Idea genes new DNA of value
• Viruses infect the network
54
eStrategy October 2000
Web Taxonomy and Functionalities
• Where is the gene pool?• How do you categorize them?• Can you identify new functionalities?• Are new hives emerging?
Best of web searches+
55
eStrategy October 2000
“Functionalities” the DNA for tomorrow’s strategist!
• Functionalities are the DNA which enable the business to interact with its customers
• Just as the different genomes contribute to success or failure of an animal species so it is with these business models – only life and death is faster!
56
eStrategy October 2000
Functionalities around ebay Auctions
Categor-ization
Feedback
BrowsingReporting
RealtimeAuctions
Forums
Search
Regis-tration
Pass-words
SafeHarbor
Person-alization
PrivacyPolicy
www.ebay.com
• ebay pioneers the market.
• Position circa mid 1999
57
eStrategy October 2000
Functionalities for emerging marketspace
• Deconstruct any internet business into its component functionalities and show how the “genes” combine to create the business and thus its value.
• Competitors with more of the right genes will ultimately destroy businesses with inferior DNA. Possible clues for the investor and manager.
58
eStrategy October 2000
Functionalities around the online auction market
Categor-ization
Feedback
BrowsingReporting
RealtimeAuctions
Forums
Search
Regis-tration
Pass-words
SafeHarbor
Person-alization
PrivacyPolicy
Appraisals
AuctionNews
Linksall
Auctions
Counters
RatesCompar-
isons
AnywhereMail
Contact
E-Post-cards
www.auctionwatch.com
www.ebay.com
• Ebay pioneers the market.
• Massive number of new entrants
• Auctionwatch links auctions
• Simplifies search and find function
PaymentSystems
59
eStrategy October 2000
Discussion: Creating Corporate DNA!
• Functionality: How might changing Internet functionality re-define your model? Reorganize as the customers value star?
• Intermediation: Identify intermediaries that change the proposition behind your business or industry. Using the additional functionalities identified in the list identify new possible combinations.
• What value added benefits are provided by this proposition? Who’s who in the food chain? Are new possible species emerging?
61
eStrategy October 2000
Explore new marketspace
• Metrics for knowledge and attention• Evolving web functionalities• Developing the value star around cognitive
space?
63
eStrategy October 2000
Cautions for Revolutionaries Consider some metrics to identify: • Where are there scaling bottlenecks? Similarly where will new points of friction
arise? Will everything scale? We need to also look for those things that won’t scale. E.g. customer support is having difficulty scaling. How do you handle flash point crowds?
What is your web site coefficient? Where are you in the food chain? How many other web sites rely on you and vice versa? Of those you rely on what are their web site coefficients? In a community and cooperative world is your web site the coefficient king?
Are you measuring inflows and outflows? Is your COMsumer community knowledge base and power increasing or decreasing? Are you actively connecting new markets, intermediating or facilitating? What metrics are you using to define the above?
Are you measuring your adaptation and change. What level of transparency exists on your site? What happens if every one you ever did business with pooled their information? Simply everything is on the net.
64
eStrategy October 2000
Possible trajectory for COMsumer empowerment• Information aggregation• Customized personalized Interactions• Empowered COMsumers participate in
personal information markets
Tipping Point
Significance
COMsumer, the word coined to describe new empowered communities comes from the Latin com plus sumere meaning - to take together.
65
eStrategy October 2000
Richness
Rea
ch
Traditional marketing trade-off
• Direct
• Scope / Scale
• Transparent values / prices
• 24/7 -- Real-time
• Search / Finding
• Multipliers
• Info-mediaries
• Rich Info
Changing role of information from a suppliers point of view
E- marketing enabled
66
eStrategy October 2000
Framing aggregation power from a consumer point of view
Richness
Val
ue
of
con
nec
tivi
ty
Traditional marketing trade-off
E- marketing enabled
• Aggregation power driven by increasing computing power and declining cost of connectivity.
• From singular to community aggregation.
67
eStrategy October 2000
Who will obtain value from mass customization?
Quality of Relationships
Val
ue
of
con
nec
tivi
ty
How is this space
expanding?
• Internet communications fueling massive new data sources.
• Think consumer information accounts and info-markets
Traditional marketing trade-off
E- marketing enabled
68
eStrategy October 2000
Empowering communities of consumers
Quality of Relationships
Val
ue
of
con
nec
tivi
ty
How is this space
expanding?
COMsumer Empowerment
COMsumingCommunities
• Real-time information aggregation of consumer owned data records.
• Records reside with individuals and communities
E- marketing enabled
Traditional marketing trade-off
69
eStrategy October 2000
COMsumer forces at play
• How quickly will your business be commoditized?
• How long before real dot-com enabled communities of consumers emerge / are empowered?
• What is the role of transparency and trust?• At what point is data collection an invasion of
privacy and permission withdrawn?• What is the impact of “real-time” on developing
new consumer functionalities?
70
eStrategy October 2000
Broad trend implications
• The customers are in charge; a clear shift in the balance of power to customers (1to1 marketing)
• Shifting the base of profits from data to information to knowledge to insights!
• Shifting basis for Market influence from vertical integration to horizontal relationships, rise of alliances
• From “proprietary-to-vendor” to open systems• Market share to competency share to share of mind• From quality to cycle time to real-time
72
eStrategy October 2000
COMsumers a new stage of e-commerce• The future will be shaped by new exchanges between
communities of consumers empowered by the further evolution of the Internet.
• The premise is that information belonging to communities of consumers will be the most important resource in the new knowledge economy.
• COMsumer, the word coined to describe these communities comes from the Latin com plus sumere meaning - to take together.
75
eStrategy October 2000
Two Day Workshop
October 2000
Stuart Henshall
eStrategy -- Day 2
The COMsumer Manifesto
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eStrategy October 2000
New roles for consumers
• Consumer Power• Communities evolution and examples• www.realcommunities.com• www.electric minds.com• www.away.com• www.epinions.com• www.amazon.com• www.arsdigita.com
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eStrategy October 2000
Personal information markets
• What’s left if your consuming community takes charge?
• COMsumer hives• Demand driven• Highly efficient and responsive information
markets• Info-portfolios• We own so we care
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eStrategy October 2000
COMsumer challenges to organizations
• Internet courtesy means seamlessly providing your customers with electronic copies of all transactions into their info-accounts
• Standards and formats for seamless data exchanges will grow in importance.
• Real-time aggregation will enable the info records to be held by the individual consumers
• Invest in creating new data-markets, rather than exploiting existing data mines, turn over your corporate databases about your customers to them!
80
eStrategy October 2000
Info-Markets
Blind PacketsNegotiation
without name
My DataPrivate
my eyes only
Our InfoCommunityLeverage
Data for SaleMy info for
paymentPrivate
PublicPrivate
Public
If the COMsumers own their own data, is this how they think about it?
Info-A
ccoun
ts
82
eStrategy October 2000
Privacy and security
• As data becomes more contested, competition for information will intensify.
• Consumer privacy will be more frequently violated.
• Rich, nameless, but highly distributed and encrypted data records are possible.
• Consumers will soon recognize that they do not have to share their info or data,
• By negotiating for their data they can either save money, or simply make dollars by selling their information or time.
• How much is known about you?
• How accurate is it?• How is the data
exchanged, and do you have any control of the standard or format?
83
eStrategy October 2000
Possible models: How might they be brought together?
• Go Fetch - Changing the couriers paradigm. My purchase, my collection system.
• Anti-port - Who should own customer feedback? It’s our feedback!
• Nutrinomics - sensors, nutritional information and genomics combine
• Car purchase to meta-market; associated leverage.
87
eStrategy October 2000
Emerging Business Issues
• Empowering consumers• Money making in a Napster world?• Networks• Intangibles etc.
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eStrategy October 2000
Will COMsumers emerge by traditional means? Even now, COMsumers are
• Accumulating transaction information
• Changing their behavior by searching the web for new functionalities
• Listing their preferences for future purchases
• The age of community owned information assets and info-exchanges for info-funds is just around the corner
• Will information strategies change? • Will product and services strategies change?• Could other possible systems approaches
emerge?
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eStrategy October 2000
Redirect information resources to responding!
Facilitate new markets don’t mediate a fixed space Provide transparent information and docking
(interconnect) systems. No record --- no business. Adopt new adaptive approaches to information
architecture and standards. Turn over your corporate database to your
customers. Consider measuring the rate with which your
COMsuming communities are learning.
90
eStrategy October 2000
Plentiful information; COMsumer Product and Service Strategies
Look to other scarcities that help to develop the value of their products and sustain their position.
Focus on design. Add tactile and personal touches Generally the trend to transparency will make products and
services delivery more functional, descriptive, factual, guaranteed, purpose driven.
Focus on integration, interconnectedness, and longevity or upgradablilty.
Re-evaluate your media position and communication mix. Recognize your developers and personalize their
contributions.
93
eStrategy October 2000
A different form of paradigm
"I realized that this wasn't about swapping MP3s [music files] but a cool new technology." It was the basis of a New Age search engine--one that wouldn't just search for music on people's computers but would hunt down anything anyone wanted to anonymously share with the outside world,”
Gene Kan 23
"The idea of file sharing is the most important development on the Web since the browser……. One of the problems with the recent evolution of the Internet is that it has become too centralized……. It's all up to something in the middle to determine what you see. Gnutella's technology blows that up. It mirrors the original architecture of the Internet.”
Marc Andreesen - Netscape Founder
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eStrategy October 2000
(1) The user logs on to the database, adding his music catalogs to a master database.(2) A song search is initiated through the Napster database. (3) Database finds the song on computer C.(4) User downloads song in MP3 format directly from computer C.
How far can the Napster community go?
Brokering new relationships!
97
eStrategy October 2000
Swarms: A bottom-up phenomena
Fish in schools, birds in flocks, bees and ants in swarms, coordinated masses of individual “agents”. ------Boids ----- Craig Reynolds
• As a Boid maintain a minimum distance from other objects and Boids in the environment
• Try to match velocities with boids in its neighborhood• Try to move towards the perceived center of mass of
Boids in its neighborhood
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eStrategy October 2000
Swarms: Evidence
• Cybiko• Xenote• Graviton• Indranet• DSL networks
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eStrategy October 2000
Not everything can swarm
• Tangible goods and process delivery
– facilitated by banks
– more transparent - more involving
• What kind of organization rewards individuals for knowledge,
– best leverages the co-creation activity?
– rise of the incubator?
• Is there any difference between employees and customers?
• What are the implications for the firm?
101
eStrategy October 2000
Scanning from the future
• What is the risk / opportunity for implementing eStrategy approaches?
• e-zines• intranets• discussion groups etc
103
eStrategy October 2000
Discussion: eStrategy challenges
• What key challenges are eStrategy concepts presenting to the future of your business? And how will you address?
• Brainstorm a list!• Agree on three key questions we must ask as
estrategists?
104
eStrategy October 2000
New strategy questions? - asked about community
• What is your community network proposition for value creation? What holds it together?
• Which new start-up or functionality do you admire the most? Why?
• What is the unique combinatorial that makes you different? What is unique about this market?
• How do you facilitate learning and knowledge creation?• How do you build alliances and further partnerships? Why
would others prefer to join rather than compete?• Where is the personal time invested, that enables the
community to expand its connectivity?
105
eStrategy October 2000
• new voices• new conversations• new perspectives• new passions• experimentation
• experimentation vs. risk management
Gary Hamel
Emergent strategies/ hidden rules - strategic conversations
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eStrategy October 2000
Users guide to holding a strategic conversation• Create a hospitable climate
• Establish an initial group, including key decision makers and outsiders
• Include outside information and outside people
• Look ahead far in advance of decisions
• Begin by looking at the present and past
• Conduct preliminary scenario Work in smaller groups
• Play out the conversation
• Live in a permanent strategic conversation
• The question of identity: evading the “Official Future”
• Strategic conversations on a small scale
Peter Schwartz “The Art of the Long View”
107
eStrategy October 2000
IntellectualLeverage
CapabilityCompetence
The issue now for strategists and market makers?
108
eStrategy October 2000
The emerging “involve me” worldT
rust
Transparency
High
Low
HighLow
“Trust me”
“Tell me”
“Show me”
“Involve me
As trust diminishes, the demand for transparency in the form of assurance mechanisms increases
Shell International SDG
109
eStrategy October 2000
Knowledge turns
• Idea derived from Inventory turns indicator of the industrial era
• Knowledge Turns = Ability to build upon Other’s Capabilities *Level of Distrust
• OC’s can be Individuals, Suppliers, Customers, Alliances, LOB’s etc
Finding Faults Finding Strengths
0.1 0.5 1 510
TRUST DISTRUST
• Multiplier scale runs from 0.01 to 100 a very sensitive indicator; see “The Network Multiplier” at www.kcindex.com
111
eStrategy October 2000
Discussion starters: Developing the scanning agenda
• Scanning for trust• Scanning to resolve whether information
really wants to be free• How will you empower your customers?• How will money be made in a Napster style
world? • Think upstream
112
eStrategy October 2000
Old Assumptions
New Beliefs
ResearchScan Monitor
Implicationsfor Strategy
Discussion: Developing the scanning agenda
114
eStrategy October 2000
Knowledge processes for Top Team, Working Leaders, Front Line Staff
• Leadership (competency acquisition) TT– stretch capabilities / develop future scenarios,
stakeholder network / knowledge goals (Hamel),
• Learning (knowledge development) WL– deepen understanding of what is / past history,
community of practice network (Senge)
• Leverage (capability enhancement) FLS– harness speed, scale, scope of present activities,
employees network of contacts (Kaplan)
All Build Links to the Future
115
eStrategy October 2000
Inventing the Future
Learning Leverage
Leverage advantages by extending
scope and scale
Maintain vitalityand deepen the understanding
Stretch capabilities for continuous improvement
Innovate or Evaporate !
FLSWL
TT
116
eStrategy October 2000
Networking integrates the basis for eStrategy
KnowledgeStrategies
117
eStrategy October 2000
eStrategy: Summary of concepts
• Innovative concepts rule - short life cycles - the Internet is a revolutionary medium for positive economic feedback loops
• Intangible assets are very much more valued at last! If possible rent -- don’t own -- your needed tangible assets
• Complexity theory shows promise to help create tomorrow’s “community of influence”- driven organizations
• Navigating the scenarios of the landscape for maximum reach and richness with minimum risk for consumers will see the development of community-owned networking portals whose leaders will invent the future
• Consumers will claim the market capital represented by their personal information for themselves -- by becoming COMsumers!!
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Communication process
• Investigate & Follow-up• Building the Flight Simulator for my Network• Giving the “Elevator Speech!”
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eStrategy October 2000
New E-Strategy Essentials
• Conversations between a community of stakeholders about their con-joint future
• A future navigating process for the agreed direction -strategic intent - which can learn from uncertainty
• The community delivers the value network desired for all stakeholders and has the capability for ongoing self-renewal
• From Value Appropriation to Value Creation for the Community is the new moral contract for delivering value to the wider society and growing their organization
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eStrategy October 2000
Future of eStrategy
• Strategy must be rooted in the language the community uses and the meaning of these individualised (intellectual / mental) concepts exploited through scenarios - so creating strategic options for the community.
• Thus defining the new or augmented knowledge turns needs of the community is the prime output of the generation of strategic options.
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eStrategy October 2000
Discussion:Communicating eStrategy
• Investigate & Follow-up• Building the Flight Simulator for my Network• Giving the “Elevator Speech!”
• What will we tell the people back home?
• Role play your first meetings with your colleagues
• In groups prepare a 5 min “event” for presentation to: – your subordinates, your peers, your boss, respectively.
• Everyone should have a role in these attempts at “theatre-sports”!
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eStrategy October 2000
Are you prepared to?
• Radically change the way you think about work and your roles in organizations (especially large ones)
• Make your organization a web-business• Expand your ‘community’ networks by a factor of 10+• Scan for uncertainties and new functionalities • Extend your strategic conversation to cultivate new
forms of involvement and feedback.• Seek to participate in world benchmarks and standard
setting• Proactively manage your information assets
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eStrategy October 2000
Become a COMsumer
• Activist on data• Demanding on transparency• Understanding of consuming communities• Facilitate innovation and empower
markets
• Go and encourage your organization to embrace the COMsumer movement.
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eStrategy October 2000
eStrategy --
Inventing Marketspace for Internet Success
