Business (Strategy) Books Lack Creativity...

Today I did some research for my upcoming book with Prof Yves Pigneur: I went to a Border's bookstore in New York and browsed the business (strategy) literature for their visuals and design. Basic conclusion: except for the cover there are no to little visuals, even for the most innovative book contents.

The most visual strategy illustration I found was in Kim & Mauborgne's blue ocean strategy book. It is part of their concept to allow for a visual comparison of the differentiation strategy of a company. Though I do like their book, I believe it lacks the same visual creativity than all other strategy books.

As to their form & usability my conclusion is that the large majority of business (strategy) books are totally un-inspirational. So I moved on to architecture books, where I expected some great visual presentations. Of course architecture is more tangible than business (strategy). Yet, I don't accept that excuse...


My nicest surprise during this little research was the discovery of a domain that makes great use of visuals: personal style. Look at the following photo & text. Wouldn't that be a nice illustration when talking about customer strategies and "personas"?


The most notable exception in the field of business books was the one I bought. It's called The Art of Engagement - Bridging the Gap between People and Possibilities. The author, Jim Haudan, uses illustrations extensively in his book and uses them as a tool for engagement... not surprising.

Though this lack of using visuals in business (strategy) books seems like a detail, I think it is essential when we are talking about strategy today. Strategies have to be communicated clearly. In today's complex world this is only possible through visuals that simplify the complex and make it clear.

Visualization is also a technique that uses one of our most important senses - the ability to see. While it was difficult to include images in the early days of books, this is now different. Why are strategy gurus still not making use of today's technology?

I hope I can change all this and bring in a fresh breeze... However, I'm still looking for the right designer, who can help us with our book ;-)

Applying Business Model Thinking

The last 2 weeks I had a couple of interesting meetings in Amsterdam and Zurich with business people who apply business model thinking in very different domains. These meetings are part of my quest to understand how people use the concept of business models (BM). It was also a pleasure to see how three of the five use my business model canvas (9 building block approach) to fit their professional needs.

What I take away from these meetings is that business model thinking in general is continuing to gain pace and will soon play a more dominant role in business thinking. Here some brief insights into how business model thinking was applied by the persons I met:

Gert Steens (Oblonski): spotting differentiators among BMs

Gert is an experienced investment professional with his own firm who uses the business model canvas to spot differences among companies in the same industry. He uses our structured approach to describing business models as a tool for comparison.

Here is roughly how it works: Gert first sketches out the business model of a company he potentially wants to invest in. Then he sketches out its competitors to compare if there are similarities or differences. It allows him to search for distinct strategic differentiators that give a company a competitive advantage.

I’m sure we will have the pleasure to hear more about Gert’s approach personally in the near future.

Bas van Oosterhout (Capgemini): aligning project porfolios with BMs

Bas
is an innovation consultant Capgemini, who applies the business model canvas within an overall approach at his firm. He applies it to help companies align and strengthen their portfolio of projects with their overall business model.

Marcel Jaeggi (BCG): scanning the competitive landscape of BMs

Marcel is a strategy consultant at the Boston Consulting Group (BCG) who is starting to look at business models in private banking for his PhD dissertation. He is aiming at describing the business models of a large number of private banks in order to classify them among groups. This will give Bas a small number of private banking business model types, which he will then assess based on a number of industry trends.

Edward Giesen (IBM): types of BM innovation

Edward is one of the business model thought leaders at IBM. The company emphasizes business model innovation since their 2006 and 2008 Global CEO Study showed how high the topic is on CEOs’ agendas. IBM distinguishes between three types of business model innovations, which are innovation in industry models, in revenue models and in enterprise models. Unfortunately, IBM’s business model innovation process does not seem publicly accessible.

Patrick Stähler: the BM change process

Patrick is an entrepreneur who already wrote about business models 10 years ago when he worked on his PhD dissertation on the topic. Just like myself, Patrick is currently working on a book on business models, which I am sure he will present on this blog. Patrick’s focus will very much be on the change process. In this regard Patrick made a very interesting comment. In our discussion he pointed out that business model innovation is very much about “un-learning”. In order to do things in new ways, we have to be able to forget the old ways of doing things. This applies for the customer side just as much as for the company side.

Podcast with John Hagel, Co-Chairman of the Deloitte Center for Edge Innovation

In the context of my company, Arvetica, I recently recorded a podcast with one my favorite thinkers, John Hagel, who is Co-Chairman of the Deloitte Center for Edge Innovation, based in Silicon Valley. I am cross-posting the podcast on this blog because it would be a waste to miss John's interesting thoughts.

The podcast is about three distinct topics John has worked on: first, his approach to strategy, second, a concept he developed called "unbundling the corporation", and third, "IT as a tool for strategic differentiation". Enjoy the listening:

speaker-image

Strategy approach: John emphasizes that all organizations should reassess their approach to strategy. He outlines an approach that departs from the traditional view of strategic planning which has a time horizon of 1-5 years. John proposes a strategy approach that operates in parallel on a long term time horizon of 5-10 years and on a short term time horizon of 6-12 months, with continuous iterations between them. He notes that this is the only way to avoid risks in high uncertainty environments.

Unbundling the corporation: This concept highlights that most companies today are an unnatural bundle of three very different types of businesses: infrastructure management businesses, customer relationship businesses, product innovation and commercialization. Each of theses businesses has very different economics, skill-sets and cultures. Hence, companies should unbundle them.

IT as a differentiator: John points out that IT is today becoming even more strategically important as a foundation for rapid incremental business innovation than previously. He explains this through new and flexible architectures which allow companies to continuously achieve IT innovation and keep a constant head start. This contrasts with the past, when companies made heavy punctual investments in IT innovations every few years, but were then copied. Finally, John also refers to the innovation potential of newer technologies that help people come together, collaborate and create value rather than just create savings through automation.

If you are interested in John Hagel's work and thinking, you should imperatively consult his blog where he writes on various topics related to business and technology. You may also want to consult his latest book "The Only Sustainable Edge", which he wrote together with John Seely Brown.

Conference Talk: Innovating the Business Model (Dublin, Ireland)

I will be speaking at the "Innovating the Business Model" conference organized by Enterprise Ireland, tomorrow, Wednesday 24th of October.

I'm quite excited to be the closing speaker of the conference, since the opening speaker is Professor Henry Chesbrough, author of the books "Open Business Models" and "Open Innovation". I had a chance to meet Henry this evening and he is a really great guy. It's wonderful to meet one of the mentors of the open enterprise concept which we apply day after day at our consulting firm Arvetica.

So in the spirit of open knowledge, please find below the set of slides that I will be presenting tomorrow:

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Workshop Outcome in Mexico

Last week I was in Mexico for Arvetica to facilitate two workshops on Business Model Design and Innovation. The first one was with a group of executives and the second one was with the faculty of the Tecnologica de Monterrey (ITESM). Both were organized by the well known ITESM.

In the first workshop (5 hours) I focused on the utility of the business model concept and a process to achieve business model innovation. In break-out sessions I got the executives to design parts of a business model of a soccer club, which worked out quite well. Here the slides:

In the second workshop (2 days) I emphasized the value of design thinking in business and how it applies to business model design and innovation. The work with the group of about 30 faculty members was quite fun and I made them design an entire (roughly shaped) business model during the two days. Besides that I outlined some of the underlying concepts to business model design and design thinking. Here the slides:

Throughout this first visit to Mexico I had the opportunity to meet some great people. I was very impressed by the strategic thinking and conceptual knowledge of industrialist, Jorge Valdes, of the Valsi and Evans brands and the quality of the people at the Tecnologico, such as Daniel Pandza and Maria Elena Vazquez.

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Draft Presentation: Competitive Advantage through Business Model Design and Innovation

I just finished a draft presentation for a workshop on the topic "Competitive Advantage through Business Model Design and Innovation". I'm facilitating the workshop next June with about 100 executives in Guadalajara, Mexico. The workshop is hosted by the Tecnologico de Monterrey (ITESM). Your input regarding the slides is most welcome:

At the end I'm going to add some slides on the blue ocean strategy concept by Kim & Mauborgne, as an example of value proposition design...

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XPLANE founder and CEO Dave Gray

At the LIFT'07 conference I had the great pleasure to talk to XPLANE founder and CEO Dave Gray. He has built a wonderful company over the years and he follows the same mantra as we do at Arvetica: visual language can help communicate complex issues such as, for example, business strategy or change management.

I very much admire Dave for being able to write a blog, educate interested people on visualization (here, here and here) and still stay an artist... I very much look forward to doing some joint work with Dave and his company.

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Nintendo's Blue Ocean Strategy: Wii

As many of you know, the video gaming market is a multi-billion dollar business. Video consoles, which is a big chunk of that market, are currently dominated by two giants: Sony with its Playstation (PS1&2 and soon PS3) and Microsoft with its Xbox (Xbox and Xbox360). Nintendo, however, a distant third actor is raising eyebrows with its recent introduction of the Wii. This is particularly interesting from a strategy point of view because it's a wonderful example of a so-called blue ocean strategy (a concept introduced by Kim & Mauborgne which I mentioned here and here). The graphic below (done with the following Blue Ocean Excel template) illustrates Nintendo's Wii strategy and is almost self-explanatory...

The graphic illustrates the attributes of Sony's, Microsoft's and Nintendo's latest consoles. What does it show? Jeremy Fain from the Tech IT Easy blog puts it nicely:

Wii doesn’t intend to be a best-of-breed videogame console. Nintendo is trying to bring non core gamers back to gaming [..] with the Wii. Wii won’t equal video game but Wii aims at meaning fun. Nintendo focuses on the consumer’s feeling rather than its product. (-> read post...)

The attributes in the graphic show that Nintendo is competing on completely different terms than Sony and Microsoft. The Wii is cheap, has no Hard Disk, no DVD, no Dolby 5.1, weak connectivity, comparatively low processor speed, but blows minds away with its innovative motion control stick (check out the demo video below). The stick integrates the movements of a player directly into the video game (think tennis, golf, sword fights, ...). With this feature Nintendo opens up the console world to a completely new public of untapped non-gamers...

All of the above describes nothing else than the characteristics of a blue ocean strategy:

  • A strong value innovation for (many new) customers (i.e. motion stick)
  • Cost reduction by eliminating features (i.e. no HD, no DVD, no Dolby 5.1, low processor speed)

These two characteristics defy the conventional wisdom that you should either go for cost leadership or differentiation but not for both (remember Michael Porter...). In Kim & Mauborgne's terms this means that while Microsoft's Xbox and Sony's PS3 are fighting each other fiercly in a red ocean (i.e. the existing market), Nintendo's Wii is calmly sailing in the blue ocean it created for itself (i.e. a new market)... By the way, Switzerland is not innocent as to the creation of this blue ocean: An Italy-based division of STMicroelectronics, which is headquartered in Geneva, Switzerland, has put forward to Nintendo the integration of motion sensors into their consoles.

Finally, if your unfamiliar with Nintendo Wii's (amazing) motion control, check out this video:

Disclosure: I haven't thoroughly assessed the detailed product specs of the three consoles. Gamers might want to correct my graphic ;-)

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