The Biz School Chronicles :: The Five Competitive Forces That Shape Strategy

It's exam time again and I'm feeling the pressure. Stacks of books to read, notes to make. And then there are those Financial Management and Operations Research formulas. As usual the Internet is a major source of reference. Studying becomes that much easier when everything is stored in a searchable index on line. The best part is that in most cases, instead of just reading a quote in a text book, you can directly hear it from the one who said it in the first place.

I came across Porter's Five Forces quite a few times while studying (It's mentioned everywhere from Marketing to MIS) and thought, why not hear it straight from the source? Let me tell you, it's one thing to read quotes and excerpts in text books and a completely different experience when you hear the original thinker explain it. In case you are wondering here's what you would see in a text book (more like a copy paste of Wikipedia).

"Porter's five forces analysis is a framework for the industry analysis and business strategy development developed by Michael E. Porter of Harvard Business School in 1979. It uses concepts developed in Industrial Organization (IO) economics to derive five forces which determine the competitive intensity and therefore attractiveness of a market. Attractiveness in this context refers to the overall industry profitability. An "unattractive" industry is one where the combination of forces acts to drive down overall profitability. A very unattractive industry would be one approaching "pure competition"."

Boring as watching paint dry right? Well, it was for me. And memorizing theory direct off the text book never works for me. But I like images though. Charts and graphs seem to get imprinted in my head better than any other form of data representation.



But my brain still wasn't giving me the right signals. It's giving me the "You have read!" stimuli but not "You have learnt!", which is what I want at this particular instance. There's a huge difference between those two individual signals. If you are simply satisfied with the first, you will get burnt at some point. So I finally turned to Google and came across this next video, where Michale Porter himself explains one of his most cited works.

Social Media and its challenges to businesses

Those who read my posts know that I'm interested in Social Media. Not only just the (obvious) social benefits, but also the potential for their usage in business. But of late, it's clear that most view social media as just another form of marketing than properly integrating it to their business. When I went through a sample of my Twitter followers, it was clear that quite a few are affiliate marketers. There's nothing wrong with this, mind you. But I think from a Business perspective, this is just one way of looking at social media.

As I highlighted a few weeks ago, just like any other strategy your social media strategy needs design too. As usual, I added some of my thoughts while quoting the original author, David Armano. Today I came across a nice follow-up post from the same author, identifying 5 key challenges to overcome while adopting social media in a business. This is clearly better structured than my random comment :) The following 5 challenges are explained in detail.

1. Integration
2. Governance
3. Culture
   
4. Human Resources
   
5. Measurement of ROI

Good read ...

HBR :: On Bad Decision Makers

Why Jerks Are Bad Decision-Makers - Tom Davenport - HarvardBusiness.org

So what are the mechanisms that translate being a jerk into being a poor decision-maker? Jerks tend to think their own perspectives are the only ones worth considering, but good decisions require serious consideration of alternatives. Jerks think they're never wrong, but good decisions require acknowledging and learning from mistakes. Jerks are consumed with petty resentments and grievances, but good decisions require clear-headed, objective thinking. Jerks alienate other people, but good decisions require collaboration across a social network (as a recent MIT Sloan Management Review article by Rob Cross and Bob Thomas suggests.) This falls short of a complete description of either jerkdom or decision excellence, but you get the picture.

Jerks often seem to get ahead in firms and advance through the ranks, but that's a dangerous phenomenon. If you want good decisions in your organization, don't hire, promote, or retain jerks.

Well.. I can't add anything more without turning this post into a rant. So just read the post above. My view is that you really can't control what type of individual becomes successful in a given organization's culture. I've seen decent and capable people who thrived in one organization not lasting more than a year or two in another. I've also seen those in limbo. The fighters who refuse to give up. I admire the latter. Because living is learning and you learn something new everyday.

HBR :: Microsoft and Yahoo: Too Little, Too Late, Too Hyped

Microsoft and Yahoo: Too Little, Too Late, Too Hyped - Now, New, Next - HarvardBusiness.org

So what is the new couple to do? First, admit that neither of them has all the answers. Second, look outside for best thinking on how to manage their new relationship (even if this means Microsoft learning from IBM, which needed a near-death experience to bring it to its senses in the 1990s). Finally, remember that for 1 plus 1 to equal 3, the partners must first act as 1 — any daylight between them will be room enough for Google's wedge.

Shareholders can only hope that no near-death experience will be needed to make them see this new reality.