New web site technology - will be a definite strategic competitive advantage for many. Taken from biz times daily. www.daily@biztimes.com Prepare for the next generation of Web sites

Originally published 2005-12-28 00:00:00

Progressive businesses staying ahead of the curve are preparing to adopt new Rich Internet Applications for their Web sites, according to a new "Best Practice Report" by the University of Wisconsin E-Business Institute (UWEBI). "Using a browser, end users can book airline tickets, bid on auctions, check e-mail, buy and sell stocks, submit tax forms, or listen to music from any networked computer. If this was the first wave of Web applications, the second big wave is yet to come in the form of Rich Internet Applications (RIAs)," the report states. "The Internet was originally designed for simply transporting documents and information. The technology it was built upon lacked the interactivity of desktop applications. That's changed in the past decade as innovators have developed a richer user experience, despite huge challenges … Thanks to this breakthrough discovery, we can now deliver very sophisticated, responsive, interactive and graphically rich applications over the Web. RIA technologies are not only enriching user experiences, but also empowering businesses to reduce development time and costs, taking web development to a whole new level. The second wave of Web applications is now starting to roll in. The questions companies need to ask internally is when to get on board, and how best to ride the tide." As a case study, the report cites the interactive and experiential differences between Yahoo! Maps and Google Maps. Yahoo! Maps is a two dimensional, traditional, plotted mapping system. Using RIA technologies, Google Maps enables users to navigate global satellite images of locations. Some of the emerging RIA programs include the AJAX, Macromedia Flash and Java platforms. The UWEBI is Wisconsin's leading center for multidisciplinary research collaboration, technology innovation and industry outreach on e-business. The full report about the impact of RIA technologies is available at www.uwebi.org.

It would appear that Google has taken sides, and the "Switzerland of Search" is no longer an unbiased player.
What does this do for Google? Have they backed themselves into a corner, or are they making associations that can grow their business? I think it is an interesting strategic move that is worth watching the outcome.

The textbook, in Chapter 4, covers the segmentation of markets into "increasingly specialized niches of customers with unique needs and interests." (p.109) The article that I found, The Business of Life: Cell Phone Niche by Bruce Meyerson, discusses the increase segmentation occurring in the cell phone market by virtual cell phone companies. Cell phone companies such as Mobile ESPN and TuYo Mobile have been launched to cater to a very specific market segment, such as sports fanatics or Spanish-speaking individuals.

Interesting article regarding competitive advantage.

THE GUERRILLA WITH THE 100% CLOSE RATE

My wife had a birthday coming up and I was thinking about a topaz ring for her when I met Wink Jones, an Idaho jeweler who runs Winfield's in Boise at 800-524-7904. His email is wink@primenet.com and his website at www.diamondsandgems.com. I tell you this because Wink said he was a guerrilla deep inside, then proceeded to prove it. I'm so delighted with my experience I hope you can have the same kind of pleasurable transaction and get to know truly customized guerrilla marketing. After speaking with me in person and with my wife by phone, Wink sent us a selection of unset topazes so my wife could make her selection. That he trusted total strangers with such beautiful stones was a revelation to me.

Next, he made a few rough designs and emailed them to us. We were impressed but still not enough to make a decision to purchase. Wink said he'd send something else to make our decision a lot easier. A week later, Fedex delivered a package. Inside was a videotape and a package of microwave popcorn, along with a suggestion to enjoy the popcorn as we viewed the tape. The tape began with music and my wife's name in the opening title. It continued with dramatic footage of three settings of the stone selected, each one shot from all sides, above, and below -- so she could inspect the designs from all angles.

She found one she loved and we ordered it, commenting that we deeply appreciated the videotape just for us. Wink told us he does that for all his customers and has closed 100% of the sales he has made using a video. Hardly a surprise, but definitely a great example of customized guerrilla marketing.

Jay Levinson and Amy Levinson

I found this interesting article at BusinessWeek online.
"How 3form is Bending the Rules of Design." by Andrew Blum.
http://www.businessweek.com/print/innovate/content/dec2005/id20051219_540958.htm

This company is utilizing plastics in a new creative building material. While their product has almost unlimited potential, they have been having a difficult time getting architects to invision the possibilities.

Also, in referencing back to EM 670 last quarter, I remembered a classmate noting how difficult and expensive is has been to get plastic, new and recycled, at his company. It seems like while the resultant product is innovative and eco-friendly, it seems it may have too many prohibitive factors to make it a staple in the construction industry.

This article discusses ford motor Companys' efforts to become innovative, and some of the strategies they are using to open new markets in the automobile industry. It seems that the company has learned a valuable lesson form the competition. Pushing new products off the showroom floor might be the new focus.
http://www.fastcompany.com/magazine/87/ford.html

There was an interesting article on Ford motor Co. and their efforts to become an innovative automobile maker, some of their strategies and the investment they are making in their R&D at the company.

In reference to understanding the external environment, I thought this was interesting. It talks about the Baby-boomers and their retirement plans.

Since Google was a discussion topic, I found this article about Google's Big Brother image.
USA today Dec 7th article: www.usatoday.com/tech/news/2005-12-07-google-phobia_x.htm

Apple, iPod, and the Music Business

In article in Business Week, December 19, 2005, titled "Apple May Be Holding Back the Music Biz"
the authors, Lowry and Grover, talk about how Apple may be withholding the capability for its music players to work with other music services (other than iTunes) because of the way it sells rights versus renting through subscriptions.

From a business model standpoint, and a business strategy, what could this mean fro Apple?

"The concept of a jukebox in the sky is not something consumers intuititively get." said an executive from REAL.

"iTunes is still the most margin-rich source of sales for record labels."

Downloads. Music. TV, Movies?

Think about it.

Gene A. Wright

I came across this article on Bloomberg.com that discusses 3M's hiring of Brunswick's George Buckley as its Chairman and CEO. I thought it strengthened the books discussion on the importance in selecting strategic leaders and how it carries over to a firm's success (reference Chapter 1, pg. 27).

Unfortunately, it does not give any insight as to why 3M choose to bring someone from the outside as it did for its previous chairman and CEO, James McNerney. Before McNerney, 3M always had someone from within running its operations. Is this an attempt to shake up the company in terms of production and profitability, or has hiring outside the organization to fill the high ranking positions become a trend?

Analog Thinking in a Digital World

Joe Mandese, Editor-in-Chief of Media Magazine
writing in his column in the November Issue made the statement, "Business Models are breaking down because we're faking them. We're still using analog thinking in a digital media world." I think this a statement worth thinking about. He uses the example of a VCR tape and how we fast-forward to get to a point we want to see. A DVR manufacturer used a "fast-forward" feature because we think in analog terms. In a digital world, we simply "go to" the point in time we want.

Interesting that he makes this illustration as it relates to business models. How many of us "think" about strategy in an analog mode? How many actually are able to think about business models in a digital mode?

Gene A. Wright

Here's an article on blogging from University Business magazine. Hope you find it interesting.

http://www.universitybusiness.com/page.cfm?p=1084

This article is cool. The company discussed was formed and run by Martin Puris who created the tagline for BMW 30 years ago, The Ultimate Driving Machine. This new company is looking at the most unique approaches to market any and all products with any form of media.

http://www.forbes.com/home_europe/free_forbes/2005/0919/077.html

This is an article from Forbes that explains a rush to build distribution centers in China. Companies like FedEX, DHL, etc are building DC's in China because of the low costs that are involved. It shines a new light for myself on how they distribute across the world.

http://www.forbes.com/logistics/2005/11/28/china-distribution-centers-cx_rm_1129china.html

I found a article explaining Sprint Nextel's release of a video phone similar to a video ipod. LINK In a class last term we discussed how Sprint's commercials seemed to more focused at business customers. This product should be well suited to the business traveler, as long as they don't already have a video ipod.

An interesting and well written short description of the Web 2.0, the "next" generation of the internet, appears as part of a Harvard Business School Newsletter, Working Knowledge.


The article, What Is Web 2.0: Design Patterns and Business Models for the Next Generation of Software which is a review and description of a website page introduces Web 2.0 and invites a click-thru.

A worthwhile read.


Gene A. Wright

Here we are Blogging as a class, and HBR publishes an article entitled "Does Your Company in the Blogosphere?" I think it does.

The Working Knowledge Newsletter article discusses How Bloggers Connect, How to Take the Lead in a Conversation, How to Boost Credibility and Get Closer to Your Customers. The article gives links to a couple "corporate" Blogs and offers suggestions on how to get the most from your blog. One specially interesting case mentioned discusses how a company is using Blogs related to Product Development.

Gene A. Wright

Here is the Wal-Mart site for the Garth Brooks box set. There is a "news and appearances" section that is interesting.

This article shows that Garth and Wal-Mart are suceeding with over 1 million units sold.

Here is an article on the Wal-Mart box set at Billboard.com.

Interesting site: follows our discussion of "outsourcing" services last night (12/7/05). This HR consulting firm has created a "blog site" for exchange of information, and likely a potential source of new clients.

see: http://thehsgroup.blogspot.com/

Article by Norman Augustine - he received an Honorary Doctorate from MSOE. He has written several articles and books on various industry topics. Here's an article he wrote recently.

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Learning to Lose?
Our Education System Isn't Ready for a World of Competition

By Norman R. Augustine
Tuesday, December 6, 2005; A29

In the five decades since I began working in the aerospace industry, I have never seen American business and academic leaders as concerned about this nation's future prosperity as they are today.

On the surface, these concerns may seem unwarranted. Two million jobs were created in the United States in the past year. Citizens of other nations continue to invest their savings in this country at a remarkable rate. Our nation still has the strongest scientific and technological enterprise -- and the best research universities -- in the world.

But deeper trends in this country and abroad are signs of a gathering storm. After the Cold War, nearly 3 billion potential new capitalists entered the job market. A substantial portion of our workforce now finds itself in direct competition for jobs with highly motivated and often well-educated people from around the world. Workers in virtually every economic sector now face competitors who live just a mouse click away in Ireland, Finland, India, China, Australia and dozens of other nations.

Soon the only jobs that will not be open to worldwide competition are those that require near physical contact between the parties to a transaction. Visitors to an office not far from the White House are greeted by a receptionist on a flat-screen display that controls access to the building and arranges contacts; she is in Pakistan. U.S. companies each morning receive software that was written in India overnight in time to be tested in the United States and returned to India for further refinement that same evening. Drawings for American architectural firms are produced in Brazil. Call-center employees in India are being taught to speak with a Midwestern accent.

This movement of U.S. jobs to other countries has few natural limits. Manufacturing jobs were the first to go, but jobs developing software and conducting various design activities soon followed. Administrative and support jobs are starting to move overseas, and even "high-end" jobs such as professional services, research and management are threatened.

Other nations will continue to have the advantage of lower wages, so the United States must compete on the basis of its strengths. Throughout the 20th century, one of these strengths was our knowledge-based resources -- particularly science and technology. But the scientific and technological foundations of our economic leadership are eroding at a time when many other nations are building their innovative capacity.

This nation's trade balance in high-technology goods swung from a positive flow of $33 billion in 1990 to a negative flow of $24 billion in 2003. Two years from now, for the first time ever, the most capable high-energy particle accelerator in the world will be outside the United States. Low-wage employers in this country, such as McDonald's and Wal-Mart, create many more jobs than do high-wage employers. In 2001 U.S. industry spent more on tort litigation and related costs than on research and development.

Today, high-technology firms have to be on the leading edge of scientific and technological progress to survive. Intel Corp. Chairman Craig Barrett has said that 90 percent of the products his company delivers on the final day of each year did not exist on the first day of the same year. To succeed in that kind of marketplace, U.S. firms need employees who are flexible, knowledgeable, and scientifically and mathematically literate.

But the U.S. educational system is failing in precisely those areas that underpin our competitiveness: science, engineering and mathematics. In a recent international test involving mathematical understanding, U.S. students finished 27th among the participating nations. In China and Japan, 59 percent and 66 percent, respectively, of undergraduates receive their degrees in science and engineering, compared with 32 percent in the United States.

I've recently had an opportunity to review these trends as chairman of a 20-member committee created by the National Academy of Sciences, the National Academy of Engineering and the Institute of Medicine. Congress asked the committee to examine the threats to America's future prosperity. The panel was a diverse group that included university presidents, Nobel laureates, heads of companies and former government officials. We agreed unanimously that the United States faces a serious and intensifying economic challenge from abroad -- and that we appear to be on a losing path.

Our committee emphasized that the United States needs to focus on fundamentals. We recommended the recruitment of 10,000 new science and math teachers each year through the awarding of competitive scholarships. The skills of a quarter-million current teachers should be improved through enhanced training and education. We recommended establishing 25,000 competitive science, mathematics, engineering and technology undergraduate scholarships and 5,000 graduate fellowships.

To boost scientific and technological innovation, we recommended that the U.S. government increase research funding by 10 percent annually over the next several years, with primary attention devoted to the physical sciences, engineering, mathematics and information sciences. We urged the federal government to create an Advanced Research Projects Agency-Energy (ARPA-E), modeled after the Defense Advanced Research Projects Agency, which would support out-of-the-box, transformative research aimed at ending our crippling dependence on foreign sources of energy. We asked the government to provide permanent tax incentives for U.S.-based innovation.

The United States wants other nations to do well economically. Broadly based prosperity can make the world more stable and safer for all. What worries business leaders is that the United States could easily fall behind as the rest of the world prospers.

The writer is the retired chairman and chief executive of Lockheed Martin Corp.

© 2005 The Washington Post Company

Interesting article about "start-up" businesses in college towns.
frank

http://abcnews.go.com/Business/print?id=1373820

I found an interesting article in Fortune, December edition. A company called Intuit (software firm) emphasizes that innovation is the acceptance of failure. The company from top down expects to hear the stupidst ideas and discusses them to determine if there is potential for innovation.

http://www.fortune.com/fortune/ceo/articles/0,15114,1135320-1,00.html

Continuing on the GOOGLE theme......

In November, 2005, Business 2.0 published an article called "Building the Next GOOGLE" that talked about a number of things an entrepreneur might do to create a GOOGLE-like business.

Among them,

1. Start Small
2. Use off-the-shelf equipment
3. Launch early, Launch often
4. Embrace Open-Source.

There a number additional tips, each with a short description.

Gene A. Wright

GOOGLE represents a great study in strategy with the question being "what is GOOGLE's business strategy?".

Certianly, they dominate the search market. However, their additional products and services, many offered at no cost to the user represents a unique apporach to the market and their growth.

An article in Business Week, December 5, Googling for Gold
talks about GOOGLE, with its market cap and its storehouse of cash, and its long awaited "spending spree". Who will they buy? Why will they buy them? What is their long term acquisition strategy?

Thought provoking isn't it?

Gene A. Wright

Looking at strategy, an excellent company to follow is APPLE. Their stream of products in the iPod family are a study in innovation, design, and business and market strategy.

An article in Business Week, talked about the Video iPod. The article, Video iPod I Love You, talks about the product as well as the deal with Disney that could "mark a new era for digital media".

Following the link will also bring the reader to another link for a Podcast interview with the author.

Gene A. Wright

Dell makes a great company to study because of their fantastic performance, their constant innovation and re-invention and their often written about business strategy.

An interesting article recently appeared in FORTUNE Magazine called "Dell's Midlife Crisis".

Hello Class.

Each week we will share some ideas about strategic management using this blog.

Each of you will become "bloggers". To do this, you must send me an email with your preferred Email address it it. I will send you an invitation to this Email address which will give you instructions on how to begin blogging. Only class members may post to this blog.

Snipettes can be anything that you have read somewhere that you think is related to Strategic Management as is worthy of discussion. Remember, this is a blog that is available to anyone on the web. You should honor copyright laws and post only YOUR ideas. If you would like class members to be able to review the article or site you are discussing ADD a LINK to the blog post.

We will most likely develop a pattern of companies and subjects we discuss.

If you have questions, submit via WebCT, call me or lets discuss in class.

Best Regards,

Gene A. Wright