~hat tip -Business Insider
08/05/2012
The best strategy is a balance between having a deliberate one, and a flexible or emergent strategy.
Honda accidently took over America with the Super Cub. The company's strategy was to sell big motorcycles, but Honda employees had more fun riding the small motorcycles around Los Angeles. A Sears buyer happened to come across the motorcycles, and the rest is history. Honda was successful because it had a flexible strategy. It was willing to change its business plan and its priorities.
In life, we need to have a deliberate strategy, but also have enough resources and flexibility to change course, and make way for an even better, emergent strategy.
Friday, August 10, 2012
ModularFinance* trumps The chuken kigyo
From The Economist November 7, 2009
A warning to the chuken kigyo is the experience of two big firms, Cannon and Nikon, against ASML, a Dutch company in the market for steppers, the tools used to make computer chips. In 1990 ASML had less than 10% of the market, while the two Japanese firms dominated it, Yet today ASML controls 65%. Japanese executives raise the matter to decry Corporate complacency. How did ASML win?
( It's the culture Stupid! )
"We were too small to compete with Nikon and Cannon directly, explains Willem Maris, who devised the strategy as the boss of ASML from 1991 - 2000. The Japanese had far more resources and did everything in-house. So ASML redesigned the product to make it modular which let it farm out work to specialists. For instance, Carl Zeiss, a German company made precision lenses. This ultimately enabled ASML to innovate faster and surpass the Japanese, says Mr. Maris.
ASML's openess took a more literal form. too."When a machine at Samsung broke down, 20 Japanese would come over and put a tent over it, so no one could see exactly exactly what they did," he says. ASML took the opposite approach, and showed customers the problem and how it would be fixed. Today, Nikon and Canon remain as closed as ever-and separate, even though merging their stepper business would make sense.
Old skills, modern times
Japan's technical success has its roots in old strengths. Its excellence in fine ceramics harks back to its expertise in pottery. Its brilliance in steel forgings are a vestige of ancient swordmaking. Japan will say this reflects their culture of monozukuri (making things) and kaizen (continuous improvement) But not all of Japan's customs serve it well. Its tradition of resisting outsiders-be they foreigners or other companies-today risks undermining it.
To help overcome the reluctance among companies to share technologies or join forces, in July METI established the Innovation Network Corporation of Japan. Packed with people from business, it acts as a sort of national private equity fund, with assets and credit guarantees totalling $9 billion. It aims to invest in promising intellectual property, with the idea of creating spin-out companies or encouraging consolidation.
A warning to the chuken kigyo is the experience of two big firms, Cannon and Nikon, against ASML, a Dutch company in the market for steppers, the tools used to make computer chips. In 1990 ASML had less than 10% of the market, while the two Japanese firms dominated it, Yet today ASML controls 65%. Japanese executives raise the matter to decry Corporate complacency. How did ASML win?
( It's the culture Stupid! )
"We were too small to compete with Nikon and Cannon directly, explains Willem Maris, who devised the strategy as the boss of ASML from 1991 - 2000. The Japanese had far more resources and did everything in-house. So ASML redesigned the product to make it modular which let it farm out work to specialists. For instance, Carl Zeiss, a German company made precision lenses. This ultimately enabled ASML to innovate faster and surpass the Japanese, says Mr. Maris.
ASML's openess took a more literal form. too."When a machine at Samsung broke down, 20 Japanese would come over and put a tent over it, so no one could see exactly exactly what they did," he says. ASML took the opposite approach, and showed customers the problem and how it would be fixed. Today, Nikon and Canon remain as closed as ever-and separate, even though merging their stepper business would make sense.
Old skills, modern times
Japan's technical success has its roots in old strengths. Its excellence in fine ceramics harks back to its expertise in pottery. Its brilliance in steel forgings are a vestige of ancient swordmaking. Japan will say this reflects their culture of monozukuri (making things) and kaizen (continuous improvement) But not all of Japan's customs serve it well. Its tradition of resisting outsiders-be they foreigners or other companies-today risks undermining it.
To help overcome the reluctance among companies to share technologies or join forces, in July METI established the Innovation Network Corporation of Japan. Packed with people from business, it acts as a sort of national private equity fund, with assets and credit guarantees totalling $9 billion. It aims to invest in promising intellectual property, with the idea of creating spin-out companies or encouraging consolidation.
Monday, July 9, 2012
From Modern to Modular - A Short History -
From The Last Man and The End of History to It's The Culture Stupid.......
The Modern World began on 29 May 1919, when photographs of a solar eclipse taken on the island of Principe off the coast of West Africa and at Sobral in Brazil confirmed the truth of a new theory of the universe. It had been apparent for half a century that the Newtonian cosmology, based upon straight lines of Euclidean geometry and Galileos' notions of absolute time, was in need of serious modification. It had stood for more than two hundred years. It was the framework within which the European Enlightenment, The Industrial Revolution and the vast expansion of human knowledge, freedom and prosperity that characterized the nineteenth century, had taken place. But increasingly powerful telescopes were revealing anomalies. In particular, the motions of the planet Mercury had deviated forty-three seconds of an arc from its predictable behavior under Newtonian laws of physics.Why? In 1905, a twenty-six year old German Jew, Albert Einstein, then working in the Swiss patent office in Berne, had published a paper on "the electrodynamics of moving bodies" which became known as the Special Theory of Relativity. Einsteins' observations on the way in which, in certain circumstances, lengths appeared to contract and clocks slow down, are analagous to the effects of perspective in painting. In fact, the discovery that space and time are relative rather than absolute terms of measurement is comparable in its effect on our perception of the world to the first use of perspective in art, which occurred in Greece in the two decades 500-480 BC.
The Modern World began on 29 May 1919, when photographs of a solar eclipse taken on the island of Principe off the coast of West Africa and at Sobral in Brazil confirmed the truth of a new theory of the universe. It had been apparent for half a century that the Newtonian cosmology, based upon straight lines of Euclidean geometry and Galileos' notions of absolute time, was in need of serious modification. It had stood for more than two hundred years. It was the framework within which the European Enlightenment, The Industrial Revolution and the vast expansion of human knowledge, freedom and prosperity that characterized the nineteenth century, had taken place. But increasingly powerful telescopes were revealing anomalies. In particular, the motions of the planet Mercury had deviated forty-three seconds of an arc from its predictable behavior under Newtonian laws of physics.Why? In 1905, a twenty-six year old German Jew, Albert Einstein, then working in the Swiss patent office in Berne, had published a paper on "the electrodynamics of moving bodies" which became known as the Special Theory of Relativity. Einsteins' observations on the way in which, in certain circumstances, lengths appeared to contract and clocks slow down, are analagous to the effects of perspective in painting. In fact, the discovery that space and time are relative rather than absolute terms of measurement is comparable in its effect on our perception of the world to the first use of perspective in art, which occurred in Greece in the two decades 500-480 BC.
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