C. Engdahl reporting from FEI2010
Moving Beyond the 'Core', New Business Model Creation
Presented by Vijay Govindarajan, Professor of International Business and Founding Director, Tuck's Center for Global Leadership
'The Future is Now!' says FEI2010 keynote speaker Vijay Govindarajan, Professor of International Business at Dartmouth. 'The Future is not about what we do in the future. It's about what we do now.' In a presentation dedicated to the seemingly basic yet often times difficult to implement concept of Strategy, Professor Govindarajan suggests that Strategy = Business Model Innovation. Strategy is not about 'managing the present', but rather about 'selectively forgetting the past' and 'creating the future'. The best way, in fact only way, to do this is to capitalize on non-linear, disruptive changes in market conditions and technology to create fundamentally different business models. Organizations manage the present by responding to linear changes in the environment. Organizations compete for the future by responding to 'call it what you will - non-linear changes, disruptive changes, step changes, or discontinuous changes.
The three basic principles set forth by Mr. Govindarajan for Business Model Innovation include:
1. Have a Big Dream. Set 'unrealistic' goals. More often than not, organizations tend to create processes and goals that 'shrink ambition.' Don't do this. Stretch imaginations. Make your organization reach farther.
2. Think about 'Next Practices' rather than 'Best Practices'. Benchmarking is not strategy.
3. Amplify Weak Signals. Take advantage and exploit seemingly innocuous and ignored opportunities in the market.
Is your strategy a dead horse?
I thought this rather amusing, so I'll share it in its entirety. According to Professor Govindarajan, here are the Top 11 Things Organizations Often Do With A Dead Horse:
11. Whip the horse a little harder
10. Change the rider
9. Harness several dead horses together for increased speed
8. Emulate the best practices of companies riding dead horses
7. Proclaim that it's cheaper to feed a dead horse
6. Shorten the track
5. Affirm that 'This is the way we have always ridden this horse'
4. Declare that 'This horse is not dead
3. Have the lawyers bring suit against the horse manufacturer
2. Engage a consultant to study the dead horse
1. Promote the dead horse to a senior management