Lecture 6 Market Dynamics Flashcards
Dual transformation terminology
Core
A company continues doing what it was already doing
Dual transformation terminology
adjacent
The company changes what customer needs/problems they fulfill/solve
however, the product stays the same
Dual transformation technology
Transformation A
The company changes the way it does business, but does not change what it sells
Dual transformation technology
Transformation B
Both the company does and how the company does it, change
Leading dual transformation
4 lessons
Lesson 1: Have the courage to choose before the sealevel starts to rise
Lesson 2: select a few moonshots with clear focus/vision
Lesson 3: have the curiosity to explore even if the probable outcome is failure
Lesson 4: have the conviction to persevere in the face of crises
Lessoin 4: have the conviciton to presevere in the fases of crisis
Hurdle A: Crisis of commitment
Hurdle B: Crisis of conflict
Hurdle C: Crisis of identity when amidst
Mckinsey Three horizons model
Horizon 1:
activities that chiefly contribute to the companies current revenue generation are classified under the first horizon. they exploit the existing business model and cire capabilities in the short-term
Horizon 2: next generation products and services, they extend a companies existing business
Horizon 3: new ideas that dont exist in the business today
The Innovation Ambition Matrix
is a framework for setting up an innovation strategy or portfolio, built up from the perspective of the current products, capabilities and resources a company has and the market it can operate in.
Three horizons model
provides a useful taxonomy for mapping growth in business over time (horizons). The model uses time as defining factor, making is suitable to link it with product or technology lifecycles. T
The frameworks overlap in
establishing a balanced portfolio
exploring or mapping an innovation ecosystem
similar in terms of framework characteristics
The frameworks differ in
the innovation ambition matrix → where and how
the three horizons model of growth → when
Incumbents incentives to innovate or not
sunk cost effect: cost inccured to commit to a particular technology
Replacement effect: the opportunity to innovate is assumed to be available to either an incumbent monopolist or a potential entrant
effiency effect: if the monopolist anticipates that the entrant may get an opportunity to innovate, its incentives to innovate will become stronger
Advantages of monopolists
- sheer amount of resources
- uniqueness of resources
- eyes on upcoming disruptions
- diverse portfolio of resources
- masters at balancing exploration and exploitation
- difficult to directly outcompete
