Business Strategy — surviving the Turning Point
“Doing Both” a book by @Inder Sidhu provides a simple but highly effective view on how to monetize in the deployment period of @Carlota Perez technology revolution cycle and also plan for the Next big bang without the collapse.
A brief summary of Carlota Perez cycle should help in grasping the meat of the book. Though the cycle talks about technology revolution but it could be applied to growth of products/businesses in general as we are in a digital age.
The Carlota Perez Framework — AVC
Now, let’s get to the strategies mentioned in the book which can help any business optimize the Deployment period and be ready for the Installation period avoiding the collapse in the Turning point.
- Sustaining and Disruptive Innovation
Sustaining disruption refers to build on Core competency. To Invest enough in cash cows so that revenue can be used to invest in disruptive innovation. It refers to be ahead of competition in the existing market by regularly providing Vow! moments to the users/customers.
Disruptive Innovation helps the organizations to be ready for next big bang, be a leader either a new market or a new product. Organizations need to have a plan and strategy to invest in new ideas, encourage early testing and failures to help keep the organization remain in growth path and build new cash cows.
- Existing and New Business Models
Inder gives an example of Disney where they moved from the core business model of Theme parks to new business models with ventures into cruise ships and now in content streaming.
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Organizations need to be prepared and plan for pivoting into vertical or horizontal business models, because someone who is more agile will come from behind with a innovative idea and cause Carlota’s creative destruction.
- Optimization and Reinvention
It is important for organizations to not only apply Kaizen to their existing processed on a regular basis but also take a higher level view and apply systems thinking to reinvent the implementation of processes.
IKEA is a good example of Optimization, it ships products in pieces so as to pack the most in the boxes and uses components which can be used across multiple products.
BMW is a good example of reinventing the process, instead of keeping a running inventory of their cars, they build customized cars based on the demand of the customer just in time.
- Doing Things Right and Doing What matters
Inder describes this as Excellence and Relevance. Build products which serves the need of the user/customer and supports business objectives using proper frameworks and let feel users feel awesome about it.
Jim Kalbach descibes one of this framework in his excellent book -
There are many management books which describe what is strategy and what should be done and not done. This book describes the tested strategy which if you read through feels like common sense but requires the buy in and commitment of senior management and trust in people who execute it.
Highly recommend both books.
