Corporate Strategy →
- 25 Jul 2007
- Lessons from the Classroom
The Evolution of Apple
Apple's continuing development from computer maker to consumer electronics pioneer is rich material in a number of Harvard Business School classrooms. Professor David Yoffie discusses his latest case study of Apple, the 5th update in 14 years, which challenges students to think strategically about Apple's successes and failures in the past, and opportunities and challenges in the future. Key concepts include: Apple has an undeniable hit with the iPod, yet faces the question of whether the growth of that business and Apple overall can be sustained. Looking at Apple through the lens of the company's previous chief executives gives students insights into why Apple lost its way after Steve Jobs left the company. Student opinion of Apple tends to be excessively positive or excessively negative, depending on the company's current fortunes. Closed for comment; 0 Comments.
- 10 Jul 2007
- Working Paper Summaries
Platform Envelopment
Established platform providers can be difficult to displace. This paper explores a path to platform leadership change that does not rely on breakthrough innovation or Schumpeterian creative destruction: a phenomenon the authors call "platform envelopment." In practical terms, envelopment entails one platform provider adding another platform's functionality to its own, and then offering a multiplatform bundle. Eisenmann and his colleagues describe a variety of envelopment attacks based on the relationship between the attacker's platform and its target's, and then discuss the economic and strategic motivations for each attack type. Key concepts include: Envelopment is a powerful force shaping platform evolution. Well-established incumbents that otherwise are sheltered from entry by standalone rivals, due to strong network effects and high switching costs, may be vulnerable to envelopment. A conglomeration attack means that platforms are functionally unrelated but may share common users and components. In such an attack, bundling can yield significant economies of scope. Example: Apple iPhone bundling smart phone with iPod. With an intermodal attack, the platforms are weak substitutes, and the attacker may neutralize an emerging competitive threat. Example: Blockbuster bundling DVD-by-mail service with store rentals. With a foreclosure attack, the platforms are complements. If envelopment reduces the appeal of a standalone provider's crucial complement, the attacker may strengthen its position vis-à-vis rivals in its core market. Example: Microsoft bundling Media Player with its Windows operating system. Closed for comment; 0 Comments.
- 21 Jun 2007
- Working Paper Summaries
Multi-Sided Platforms: From Microfoundations to Design and Expansion Strategies
The term "platform" is increasingly popular among executives today. Platforms, and multi-sided platforms (MSPs) in particular, serve the needs of interdependent constituents. Although MSPs have existed for centuries in the form of matchmakers and village markets, information technology has increased tremendously the opportunities for building larger, more powerful, and more valuable platforms. At the same time, by expanding the potential scope of platforms, information technology has also increased the number and complexity of factors, both economic and technical, that drive the strategic design of MSPs. Surprisingly, few companies rigorously analyze the underlying drivers of their MSPs, and the emerging business and economics literature on two-sided markets has not been very helpful in this direction, either. This article provides a general framework to help organize managerial thinking about MSPs. Key concepts include: This framework is useful because it induces systematic analysis of MSP strategic opportunities and the critical tradeoffs involved, based on fundamental economic functions that cut across any specific industry setting. Strategic design defines the relevant space in which the MSP operates, its multiple constituents, and its competitors, both actual and potential. Designing and expanding MSPs is a complex, daunting, and, most importantly, dynamic process. The most successful MSPs are constantly evolving. While this dynamism is especially true in high-tech markets, even traditional businesses can unlock powerful sources of indirect network effects with a little technological help and a good amount of creativity. The devil is in the details. Closed for comment; 0 Comments.
- 20 Dec 2006
- Working Paper Summaries
The Demise of Cost and Profit Centers
The Balanced Scorecard has proven to be a general and powerful performance management framework for units previously treated as profit and investment centers. The management control literature, however, identifies other organizational forms for decentralized units, including standard cost centers, revenue centers, and support units treated as discretionary expense centers. Starting from the example of a classic teaching case, Empire Glass Company, Kaplan explains how strategy maps and the Balanced Scorecard transform cost, revenue, and discretionary expense centers into strategic business units in their own right. Key concepts include: The foundation of management control systems has been enhanced by applying strategy maps and Balanced Scorecards to motivate, align, and evaluate the performance of diverse organizational units. The leading paradigm of organizational structure and control of just a generation ago—based on cost, profit, investment, revenue, and discretionary expense centers—is replaced by a framework in which every organizational unit can be considered a strategic business unit. Closed for comment; 0 Comments.
- 05 Jul 2006
- Working Paper Summaries
Improving Corporate Governance with the Balanced Scorecard
The authors review the key roles of corporate boards and recommend a Balanced Scorecard approach to help boards work smarter, not harder. Kaplan and Nagel recommend a three-part Balanced Scorecard program: Part 1: An Enterprise Scorecard that includes enterprise-wide strategic objectives, performance measures, targets, and initiatives; Part 2: A Board Scorecard that defines and clarifies the strategic contributions and requirements of the board, and provides a tool to manage the board's performance; Part 3: Executive Scorecards, which define strategic contributions of top management and are used to select, evaluate, and reward senior executives. Key concepts include: Reforms such as Sarbanes-Oxley have increased the amount of work that boards need to do. A Balanced Scorecard approach can help boards use their limited time effectively. An enterprise strategy map and enterprise Balanced Scorecard should be the primary documents distributed to the board in advance of meetings. Closed for comment; 0 Comments.
- 05 Jul 2006
- Working Paper Summaries
Wintel: Cooperation or Conflict
Industries are becoming more horizontal. Products that used to be designed and manufactured by a single firm are now produced by different companies that must coordinate activities. Here, the authors detail the relationship between Intel and Microsoft (both integral to PCs) and, using a mixed-duopoly model, analyze the dynamics of cooperation verses competition. They find that costs associated with complementary R&D, conflicts of interest in pricing, and the possibility of competitors all factor in the decision of when to cooperate or compete. Key concepts include: Complementary companies tend to compete on issues of price. For example, if one sells high (Intel's microprocessors) then another must sell low (Microsoft's software) in order for a product (a PC) to be able to sell at a profit. Complementors should weigh the costs and benefits of encouraging competition in each others' spaces. Closed for comment; 0 Comments.
- 05 Jul 2006
- Working Paper Summaries
Creating the Office of Strategy Management
Organizations often fail to execute their strategy—failure rates may range as high as 60 to 90 percent. Successful companies align their key management processes for effective strategy execution. Creating a new corporate-unit level, the Office of Strategy Management (OSM), may help align management processes to strategy. The authors explain, among other topics, OSM core processes, desirable OSM processes, integrative processes, and positioning the OSM. Key concepts include: Strategy management is an emerging profession. Each organization must ask itself: What are we doing to make strategy management a core competency of our organization? Create an Office of Strategy Management, position it at the level of other senior corporate staff offices, and give it responsibility and authority for the nine key strategy management processes. Closed for comment; 0 Comments.
- 05 Jul 2006
- Working Paper Summaries
Bringing History into International Business
International Business scholars often talk about history, but rarely take it seriously. The first generation of International Business scholars placed a high priority on evolutionary and historical perspectives and methodology, but little work these days grapples with the history of International Business or uses historical data to explore an issue. Jones and Khanna discuss new avenues for researching business groups in history and in contemporary emerging markets, resource-based and path-dependent theories of the firm, and foreign direct investment and development over time. Key concepts include: Move beyond assertions that "history matters" and explore how it matters. Longitudinal analysis is important. History can be treated as rigorously as conventional statistical analysis, and should be. Closed for comment; 0 Comments.
- 26 Mar 2006
- Research & Ideas
The Office of Strategy Management
Many organizations suffer a disconnect between strategy formulation and its execution. The answer? HBS professor Robert S. Kaplan and colleague Andrew Pateman argue for the creation of a new corporate office. Closed for comment; 0 Comments.
- 09 Jan 2006
- Research & Ideas
What Really Drives Your Strategy?
For better or worse, why do so many companies veer off their strategic plan? Look for a disconnect between strategy and how resources are allocated, say Harvard Business School’s Joseph L. Bower and Clark G. Gilbert. Closed for comment; 0 Comments.
- 18 Jul 2005
- Research & Ideas
Identify Emerging Market Opportunities
Yes, you understand your company needs to compete in emerging markets. But which country is the best fit for you? A Harvard Business Review excerpt by Tarun Khanna, Krishna G. Palepu, and Jayant Sinha. Closed for comment; 0 Comments.
- 06 Sep 2004
- Research & Ideas
The Innovator’s Battle Plan
Great firms can be undone by disruptors who analyze and exploit an incumbent’s skills and motivations. From Clayton Christensen’s new book Seeing What’s Next. Closed for comment; 0 Comments.
- 23 Aug 2004
- Research & Ideas
Strategy for Small Fish
Microsoft, Wal-Mart, and eBay provide ecosystems in which other companies thrive or fail. But what are effective strategies for a small fish in a big pond? An excerpt from The Keystone Advantage by HBS professor Marco Iansiti and Roy Levien. Closed for comment; 0 Comments.
- 09 Aug 2004
- Research & Ideas
A Diagnostic for Disruptive Innovation
You have three potential innovations, but resources to develop just one. Here are diagnostics to help you make the best decision. From Strategy & Innovation newsletter. Closed for comment; 0 Comments.
- 28 Jun 2004
- Research & Ideas
How to Avoid a Price Increase
Consumers hate price increases, but what is a company to do when material costs skyrocket? One answer: Think small. Professor John Gourville considers the alternative in this Q&A. Closed for comment; 0 Comments.
- 10 May 2004
- Research & Ideas
Rethink the Value of Joint Ventures
Why are joint ventures losing favor with transnational companies? Professor Mihir A. Desai discusses research that suggests globalization makes go-it-alone strategies pay off. Closed for comment; 0 Comments.
- 12 Apr 2004
- Research & Ideas
Operations and the Competitive Edge
Many managers expect operations organizations to fulfill only a support role. But an effective operations strategy can give you a competitive advantage. An interview with professor Robert Hayes. Closed for comment; 0 Comments.
- 08 Mar 2004
- Research & Ideas
Creating Value in Your Business Ecosystem
The metaphors of keystones and ecology help you think about your business environment, say professor Marco Iansiti and consultant Roy Levien. A Harvard Business Review excerpt. Closed for comment; 0 Comments.
- 09 Feb 2004
- Research & Ideas
Got a New Strategy? Now Make it Happen
Many strategies never take off for lack of honest discussion, say Harvard Business School's Michael Beer and co-author Russell A. Eisenstat. A Harvard Business Review excerpt. Closed for comment; 0 Comments.
The Dark Side of Trust
It has been well documented that strong trust between a buyer and supplier provides many advantages, such as increased productivity. But according to new research coauthored by HBS professor Felix Oberholzer-Gee, trusting relationships can also have a negative side that managers must take into account. Key concepts include: Many scholars agree that trust between suppliers and buyers generates significant benefits including motivating better performance and reducing negotiation time. Breaking apart a trusted buyer-supplier relationship can be a significant barrier to entry for competitors. The negative side of trust is that it can blind you to opportunities that arise outside established relationships. Closed for comment; 0 Comments.