The Hunger Games of Strategy

Deadly competition in an era of openess, sustainability and play

Jean-Michel Viola, PhD

What is Strategy?

Deadly coopetition

• Hypercompetition (cost + differentiation)• Blue ocean is hard to find• Competitive advantages can rarely be sustained• H index are decreasing

• The case of Mobile in France (64M active sim cards in 2012)

Disruptive ?

Is Strategizing still relevant?

Three Schools

Formal strategy Realized strategy

Emerging strategy

Key success factors

Core Competenc

e

Activities

A B

C

Products

How strategy is changing?

• Business models • Big data analytics• Sustainability • Gamification• Managerial implications

The classical strategic model

Competitive rivalry within the industry

Threat of new entrants

Bargaining power of

Buyers

Threat of Substitutes

Bargaining power of suppliers

Primary activiti

esInbound logistics

Operations

Outbound logistics

Marketing and sales

Service

Support

activitiesFirm

infrastructure

Human resource

management

Reserach and Development

Procurement

Margin

The case of Amazon

What is a business model?

• Describes how an organization creates, delivers and captures value (Chesborough & Rosenbloom, 2002)

Technicalinputs

Economicoutputs

Value proposition

Target segments Product or service offering Revenue model

Operating model

OrganizationCost modelValue chain

Business Models

• The case of Amazon– R-D and The Kindle– Building warehouse in NJ and will start collect sales tax

• The case of Technicolor– Commoditization of its historic core business (electronic

appliances)– Refocus on image technologies– Difficulties to adjust the organization to a shrinking sales

base

Three trends that are changing the rules of the

game

The age of big data

• Storage and data have grown exponentially

• Kryder’s law• Open data trend in both the public

and private sphere• How to make sense of this for

insights and profits?

The new data ecosystemIndividuals

•Data type•Crowdsourced information, data exhaust

•Sharing incentives•Pricing offers, Improved services

•Requirements•Privacy standards, Opt out ability

Public sector•Data type•Census data, health indicators, tax and expenditure

information, facility data•Sharing incentives• Improved service provision, increased efficiency in

expenditures•Requirements•Privacy standards, Opt out ability

Private sector•Data type•Transaction data, spending and use data

•Sharing incentives• Improved consumer knowledge and ability to predict

trends•Requirements•Business models, ownership of sensitive data

Faster Outbreak, Tracking and response

Improved understanding of crisis behavior change

Accurate mapping of service needs

Ability to predict Demand & Supply changes

Data Mining & Analysis

The age of algorithms

• Algorithm to choose a bra over 50 points @ True&Co https://trueandco.com/

• API application and dynamic display http://www.nytimes.com/interactive/2012/02/13/us/politics/2013-budget-proposal-graphic.html

• Geolocalization to mine for technological growth, partners and competitors

Big data Analytics in practice

The age of algorithmsTrue&Co has built an algorithm aver 50 points of data for women to choose a brahttp://www.nytimes.com/interactive/2012/02/13/us/politics/2013-budget-proposal-graphic.html The case of the USPTO

Technicolor patents base

Mapping asthma for insights

Identify key technological leaders

Spot alternativeTechnological

options

Identify emerging technological

options

A recent snapshot on asthma

% of respondants, n=1469, McKinsey Report , 2012

Functional areas where companies do, and should, focus on using big data and analytics to improve overall performance

Ideally

Currently

Implications for strategy

• Competition, Customers, Competitive advantage

• A switch from getting information to making sense of information

• New organization and new skills• From monopolistic rent to knowledge

rents

Gamification• The use of game design, game thinking

and game mechanics to enhance non-game contexts

• To encourage people to adopt applications and processes, influence how they are used

• To help solving problems• Taking advantage of human psychological

predispositions to engage in gaming• Augmented reality trend• Smart cities trend

YOUTUBE VIDEO CAN YOU GUESS WHAT IT IS ALL ABOUT?

http://www.youtube.com/watch?v=lGYJyur4FUA

Gamification in practice

• These are online gamers that are unlocking the structure of an enzyme active in aids transmission (Foldit)

• http://lemonopoly.org/

Implications for strategy

• Available data from gamified websites, applications, and processes indicate potential improvements in areas like user engagement, ROI, data quality, timeliness, or learning

http://www.tagxedo.com/artful/af99b29f29da41ee

Sustainability (CSR)

• A stakeholders approach• Very different flavors • Growing commitment (business case,

competitivity issue, on the permanent agenda)

Sustainability in practice

• Reindustrialization in Europe and in the US

• Fortune at the bottom of the pyramid– Mobile ICT in India– Mobile phone markets: smart and dumb

• Diversity

Implications for strategy

• Ability to map, assess and address key stakeholders… way beyond clients

• Delicately assess the CSR business model… if there is any!

• Or assess the “good citizen tax” of doing not too bad

So…

• Big data creates new opportunities for customization but asks for new skills

• Gamification improves attention and involvement from customers and allows for a better knowledge of useage

• CSR is about image and norms, creates a lot of noise in terms of mixes signals

• Strategy is about designing and assessing the relation between an organization and its environment

• Saying that the environment has a growing complexity is still too soft

• Strategy is still about designing and assessing the relation but there are much more data to filter and much more bricks to put together for a shorter life frame

Managerial implications

• Critical thinking in the age of questioning

• The need for situational adaptability• Life long learning , short live

knowledge

Multumesc