The business world is being disrupted by the combined effects of growing emerging economies, shifts in global demographics, ubiquity of technology and accountability regulation. Infosys believes that to compete in the flat world, businesses must shift their operational priorities.

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February 22, 2007

Satellite radio: Waiting for innovation

The announced merger of the two US satellite radio services, Sirius and XM, has resulted in much ink about the likelihood (or not) of US FCC approval of the merger and the merger's impact on service prices for consumers.

Much of this coverage misses the point: In an era where many businesses are succeeding in what would previously be considered niche or unprofitable markets, why has the emerging satellite radio industry remained, well, still emerging?

To recover the high cost of customer acquisition, companies must retain customers for some time.  And to retain these customers, they must offer something new of value.  Customers who signed up for these services may have originally done so out of curiousity and 'cool' technology factor.  However, at some point, unless the companies offer newer services that are better than the original, they risk losing customers to substitutes such as MP3 players and radio. 

I've considered subscribing to a satellite radio service in India to be able to listen to, say, NPR or a good jazz station.  But what I would really like is to have a single platform on which I can listen to music or programming from a selection sources, perhaps 3-4 radio stations from the US, 3-4 radio stations from Bangalore, combined with what's on my iPod.  And, I want to be able to listen to this whether I am in Bangalore, San Francisco, or London.  Whether I'm in my home or in the car.

Now, that, would a service I wouldn't mind paying for and keeping: a combination of device and service that makes my personal favorites available to me whereve I am.  Sort of a 'radio-berry' for my personal broadcast and owned music.

Unless the satellite radio (and digital music-player) industry innovates to offer new better services, customers are bound to figure out that all they are paying for is yet another silo-ed cool technology.  That may have been enough a few years ago.  But not in today's flattening world.

February 16, 2007

The Myth of Market Share

Professor J. Scott Armstrong of Wharton says that obsessing about market share may cause companies to lose focus on what matters most -- profitability.

"We're not saying companies shouldn't pay attention to their competitors; they might be doing reasonable things that you may also want to do," Armstrong says. "What we're saying is that the objective should not be to try to beat your competitor. The objective should be profitability. In view of all the damage that occurs by focusing on market share, companies would be better off not measuring it." 

Read more.

February 5, 2007

Puzzle versus Mystery

Recently I met Sharad Elhence who leads the Product Operations practice at Infosys Consulting.  He shared some interesting thoughts on information usage (or lack of it) by corporations.

He says:

"Malcolm Gladwell’s article “Open Secrets” in the January 8, 2007 issue of The New Yorker made an interesting read on my long flight from Frankfurt to Bangalore last week.  It provided a different perspective on the Enron scandal and Jeff Skilling’s prosecution.  Did Jeff Skilling and other Enron executives withhold critical information from investors?  Or did they share as much information as they could but nobody fully analyzed and interpreted that information?  In other words, was the core of the Enron scandal a puzzle or a mystery?  Malcolm cites the distinction between a puzzle (situation where we don’t have enough information available to us) and a mystery (where we have all the information available but the interpretation of the information requires analysis and judgment) from the work done by Gregory Treverton, a national security expert.

"What does this have to do with the Flat World ideas?  I believe that the fundamental shift of making money from information is all about understanding the difference between a puzzle and a mystery.  In the business world, there are a many more mysteries than puzzles.  Collecting more information may help solve a puzzle or two but monetizing information will come from having the mindset of solving a mystery.  Analyzing the data that companies already have collected to gain insights about their markets, competitors, customers, channels, products and operations is essential to delivering ROI (return on information).  So let’s unravel the big mysteries in ours and our customers’ businesses and if we find a puzzle along the way, let’s gather the missing information to solve that puzzle and then get back to the bigger mysteries and the associated big payoffs."

Sharad Elhence leads the Product Operations Practice at Infosys Consulting, helping clients in strategy, process and technology issues related to improving end-to-end supply chain performance.  He has more than 18 years of consulting and leadership experience.  Most recently, he was the Chief Operating Officer for an early stage provider of enterprise performance and knowledge management solutions.  Prior to that he was Vice President of Strategy at i2 Technologies and a management consultant with McKinsey & Company.