Monday, September 27, 2010

Why I.B.M. Took a Different Path in Storage

I thought this article offers insight into how to fully deploy your internal R&D organization:

"The high-stakes sumo match between Hewlett-Packard and Dell ended on Thursday, with H.P. paying about $2.3 billion for 3Par.

I.B.M. has said it looked at 3Par and other companies more than two years ago, when it was building up in the field of clustered storage, an important technology in handling data remotely for so-called cloud computing systems. Instead of 3Par, it bought an Israeli clustered-storage specialist, XIV.

I.B.M. did not report the price tag on XIV. But analysts estimate it probably paid less than $200 million for a business that now generates more sales than 3Par’s revenue of $194 million last year.

I.B.M. will not comment on those estimates, but it does point to the XIV deal as an example of how its research labs are used to inform the company’s merger, acquisition and divestiture strategy.
In fact, Big Blue’s storage business has been bolstered by a series of early-stage purchases in the sector over the last couple of years, including Arsenal Digital, Storwize and Diligent. I.B.M. has not gotten in the middle of pricey bidding wars like the one over 3Par or over Data Domain, which EMC bought last year for $2.4 billion, after beating out NetApp.

The labs, explains Robert Morris, a vice president of I.B.M. Research, provide strategic “headlights” for the company as a whole. At the end of each year, the lab researchers prepare a global technology outlook, which presents senior management with an assessment and predictions about key technologies over the coming several years.

As a senior research manager, Mr. Morris also meets with members of I.B.M.’s M.&A. teams four times a year. “
It’s not enough to see in the future, you have to act,” he said. “If you’re ahead of the game, you can go in and get companies at a good price, before others recognize the value.

The researchers, Mr. Morris adds, learn things from the I.B.M. acquisition teams as well. “They’ll say, ‘Have you seen this little company?’ ” he said.
“They’re like sensors in the marketplace. We develop a lot inside I.B.M., but most innovation is going on outside any single company.

Monday, September 20, 2010

Innovation and commercialization, 2010: McKinsey Global Survey results

This is an important article to read to bench mark your company to their findings. Most of the major barriers to growth are internal and under management control. Excerpts are:

"As companies begin to refocus on growth, innovation has once again become a priority: in a recent McKinsey Global Survey,1 84 percent of executives say innovation is extremely or very important to their companies’ growth strategy

Growth and innovation
Almost all companies are actively seeking growth again. For the largest group of respondents, 41 percent, the focus is on their existing core businesses (Exhibit 1). Only respondents in the high-tech industry differ. In addition, more executives say their companies are seeking organic growth through new products or services or new customers in existing markets (68 percent and 63 percent, respectively) than are pursuing growth through new markets or M&A

Managing innovation
Just over half of all respondents, 55 percent, say their companies are better than their peers at innovation, a figure that hasn’t budged since 2008…..Fundamentally, the biggest challenge is organization
(internal issues)

Going to market
Only 39 percent of respondents say their companies are good at commercializing new products or services….A big part of the problem may be the absence of a formal decision-making process"
(internal issues)

Monday, September 13, 2010

Five Reasons You Don’t Have the Time to Delay Innovation

I think this is an interesting article. I prefer you think of “managing” risk at the early innovation stages vs. eliminating it.
Eat your own lunch before someone else does it for you.
The pace of innovation is getting faster in every industry. Product teams that were stretching to meet 7 year delivery cycles are now being asked to compress the cycle to 3 years.
Eliminate (manage) business risks
Much of business success is about managing risks….. Sustainable innovation practice is not about taking on greater risk, it’s about eliminating (managing) risks… pre-validating conceptual designs before moving them into downstream processes (this is a managing concept)
Saving time
If you are not integrating innovation best practices into you value creation and delivery processes, you are wasting time.
Saving money
The net result of making the right choices, eliminating (managing) risks, and saving time through innovation is that you will be driving a more efficient and effective organization
Making money
While there are cost saving benefits that companies derive from innovation, it is in the dimension of revenue, market share, and profits that innovation delivers its greatest benefits.

Tuesday, September 07, 2010

Don't Rule Out Apple Ruling Your Living Room
The new Apple TV fits into Steve Jobs' entertainment vision

By Peter Burrows

What I love about this article is Job’s concept of “owning the living room”. It is so powerful and it forces Apple to think about all the parts that must fit together—technology platform; deals with content providers; pricing; etc. More and more companies have to think about their growth domains in this “above the tree line” way to fully capture the available consumer/customer dollar that is potentially available.

"Apple's (AAPL) decade-long run of iPod-, iPhone-, and iPad-fueled prosperity has featured only one notable dud. Introduced in 2006, Apple TV is a set-top box used to play movies and other digital fare on a TV via iTunes on a Mac or PC. Apple has sold fewer than 3 million of them, estimates Kaufman Bros. analyst Shaw Wu. The company sold that many iPads in three months.

And yet, at a Sept. 1 event in San Francisco, Steve Jobs announced that Apple is bringing out a less-than-revolutionary upgrade.

So why bother? Even Jobs concedes the device (a cheaper Apple TV device) is mainly for tech hobbyists, and most of the Sept. 1 event was dedicated to the revelation of a new line of iPods and a social networking feature that works within iTunes. What Jobs didn't say is that Apple wants to become king of the living room. He tells Bloomberg Businessweek that when the time is right, Apple could open an App Store for the TV that could do for television sets what all those apps have done for the iPhone. Asked if the iPad could evolve into the TV of tomorrow, Jobs shrugs and says, "That's how I do most of my TV watching today."