I just spent 10 minutes thinking unkind things about Eddie Bauer. I even shouted an anguished swear word, piercing the silence of my otherwise quiet home. My husband Nick had an overnight guest – our toddler grandson – while I was away and had forgotten to fold up the Eddie Bauer portable crib. Trying to be serious in my home office with a baby crib in my eye’s sight was not working for me, so I decided to take on Nick’s assigned chore and put the crib away. The task should be straightforward I thought. (It’s not IKEA furniture after all with one page of instruction containing no words.) It seemed like I should have been able to unlock the crib’s sides by squeezing plastic handles to collapse the unit, and then put the far-more-compact unit into its zippered case. But as I…
Is your scope too narrow or broad?
All too often, companies take the scope of their offerings as a given, delaying changes that make the organization ripe for disruption. Kodak stuck with “film” as its core business while competitor FugiFilm Holdings, Inc. accepted the inevitability of digital replacing film. Fugi transformed its business by leveraging its chemical and processing capabilities into liquid crystal displays and beauty products. The change was traumatic -– thousands lost their jobs -– but, unlike Kodak, Fugi company exists and is growing. The WSJ is full of change-in-scope decisions. HP is splitting into two parts, enterprise solutions on one side, printers and PCs on the other. Unless HP can make a go of 3-D printing, I expect Lenovo or Dell will acquire the printing/PC unit as computing shifts to mobile devices. IBM is harvesting its more commodity-like businesses to double down on mobile, software and the…
Big pharma faces big business model questions
To pick the best vacation spot for hiking in February, I look at climate patterns. In the world of business, external trends help suggest the most attractive market spaces. Arrive before the crowds, and you’ll have the best experience, a principle as true for industry convergence as it is for hiking. Nevertheless, leaders too often stay stuck in current market spaces by failing to challenge historic answers to the vital business model strategy question, “What business are we in?” They get left behind as their industry converges with others, with pharmaceutical companies the latest example. As scientists’ understanding of cellular and molecular mechanisms deepened, pharmaceutical manufacturers added biologics to their offerings by evolving their internal R&D approaches and acquiring or partnering with biotech drug discovery start-ups. But with a few exceptions, drug companies’ core business remains developing and selling drugs that treat specific…