Winning in Networks


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Discussion slides used at the Insights 2010 @ Boston University.

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Winning in Networks

  1. 1. Winning in Networks<br />Professor N. VenkatVenkatramanDavid J. McGrath Jr. Professor of Management<br />Boston University School of Management<br /><br />Twitter: NVenkatraman<br />October 9, 2010<br />Insights 2010<br />
  2. 2. Overview<br />(c) N. Venkatraman [2010]<br />2<br />
  3. 3. Imagine life without……<br />(c) N. Venkatraman [2010]<br />3<br />
  4. 4. Towards Networked Era:A Brief History<br />(c) N. Venkatraman [2010]<br />4<br />1,920,000,000<br />4,900,000,000<br />*July 31, 2010<br />
  5. 5. A brief history… (continued):YouTube and Hulu generate 2X traffic than the entire Internet in 2000<br />(c) N. Venkatraman [2010]<br />5<br />Source: Cisco<br />
  6. 6. And Facebook….<br />(c) N. Venkatraman [2010]<br />6<br />500+ million<br />
  7. 7. And.. there are tweets…<br />(c) N. Venkatraman [2010]<br />7<br />*April 8, 2010<br />*October 8, 2010<br />
  8. 8. From 1995 till today..<br />Developments in information technology have been dramatic and significant<br />Shifts in management practices have been incremental and slow<br />A new generation of people (employees, citizens, consumers) growing up with technology<br />(c) N. Venkatraman [2010]<br />8<br />
  9. 9. Yet.. there is an alignment problem<br />(c) N. Venkatraman [2010]<br />9<br />Business Strategy<br />ITStrategy<br />
  10. 10. Towards Global Digital Network Era….<br />(c) N. Venkatraman [2010]<br />10<br />
  11. 11. Information technology is impacting products..<br />(c) N. Venkatraman [2010]<br />11<br />
  12. 12. Products linked on all-IP infrastructure<br />Towards40-50 billiondevices<br />12<br />(c) N. Venkatraman [2010]<br />
  13. 13. IT’s impacting next generation business processes..<br />(c) N. Venkatraman [2010]<br />13<br />video<br />
  14. 14. Processes designed for the global All-IP infrastructure<br />Next-generationprocesses<br />14<br />(c) N. Venkatraman [2010]<br />
  15. 15. ….and service delivery…<br />(c) N. Venkatraman [2010]<br />15<br />
  16. 16. Services delivered on the All-IP infrastructure<br />Next-generationservices<br />16<br />(c) N. Venkatraman [2010]<br />
  17. 17. And.. It is accelerating compared to other technologies in the past….<br />(c) N. Venkatraman [2010]<br />17<br />Source: IBM (2005)<br />
  18. 18. Mobile internet is accelerating even faster..<br />(c) N. Venkatraman [2010]<br />18<br />Source: Morgan Stanley<br />
  19. 19. … beyond phones<br />(c) N. Venkatraman [2010]<br />19<br />Source: Morgan Stanley<br />
  20. 20. …unleashing ‘apps’ at an unprecedented rate<br />(c) N. Venkatraman [2010]<br />20<br />Source: Morgan Stanley<br />
  21. 21. …With iPad setting a record..<br />(c) N. Venkatraman [2010]<br />21<br />Source: Morgan Stanley<br />
  22. 22. …Pervasiveness of IT.. (everywhere)<br />(c) N. Venkatraman [2010]<br />22<br />Source: Morgan Stanley<br />
  23. 23. The new global digital business infrastructure….<br />(c) N. Venkatraman [2010]<br />23<br />Transact<br />Innovate<br />Live<br />Learn<br />Play<br />Work<br />Connect<br />Consume<br />
  24. 24. The World is ‘Flat’ but Connected…<br />(c) N. Venkatraman [2010]<br />24<br />And…connected<br />
  25. 25. Let us introduce three technology laws<br />(c) N. Venkatraman [2010]<br />25<br />
  26. 26. And take them together..<br />(c) N. Venkatraman [2010]<br />“Computer”<br />“Connectivity”<br />“Cloud”<br />26<br />
  27. 27. A working framework to understand how IT impacts business…<br />(c) N. Venkatraman [2010]<br />BandwidthLaw<br />Metcalfe’sLaw<br />Technology<br />Domain<br />Moore’sLaw<br />Process<br />Product<br />Service<br />Business<br />Domain<br />27<br />
  28. 28. Overview<br />(c) N. Venkatraman [2010]<br />28<br />
  29. 29. Computer industry [circa 1980]<br />Source: Bill Gates Testimony <br />Source: Bill Gates Testimony<br />29<br />(c) N. Venkatraman [2010]<br />
  30. 30. Computer industry [circa 2002]<br />Source: Bill Gates Testimony <br />30<br />(c) N. Venkatraman [2010]<br />
  31. 31. Two Key ideas…<br />Vertical integration giving way to horizontal layers of specialized capabilities<br />When and how do new layers emerge?<br />When do layers disappear or morph?<br />Can you disrupt an industry by introducing a new layer where you hold an advantage?<br />Can new entrants disrupt by introducing a new layer? <br />31<br />(c) N. Venkatraman [2010]<br />1<br />
  32. 32. Two Key ideas…<br />Winning requires dominating one layer but linking across other layers<br />What’s your pattern of connection across layers? <br />How does your competition connect across layers? <br />Who has the advantage now? <br />Is this advantage defensible? <br />32<br />(c) N. Venkatraman [2010]<br />2<br />
  33. 33. Setting 2: Automotive<br />(c) N. Venkatraman [2010]<br />33<br />
  34. 34. Automobile– “computers on wheels”<br />(c) N. Venkatraman [2010]<br />34<br />‘Black Box’<br />Lines of Software Code<br />
  35. 35. OnStar by GM  OnStar<br />(c) N. Venkatraman [2010]<br />35<br />
  36. 36. Ford (and Microsoft): Sync<br />(c) N. Venkatraman [2010]<br />36<br />In-Car WiFi<br />(2010)<br />
  37. 37. MyFord Touch<br />(c) N. Venkatraman [2010]<br />37<br />
  38. 38. Apps in the Automobile<br />(c) N. Venkatraman [2010]<br />38<br />
  39. 39. Future competition linked to IT architecture<br />(c) N. Venkatraman [2010]<br />39<br />
  40. 40. Transformations underway in the auto sector<br />(c) N. Venkatraman [2010]<br />40<br />
  41. 41. Setting 3: Music  Mobile Phones & ?<br />(c) N. Venkatraman [2010]<br />41<br />
  42. 42. Music in the analog era….<br />(c) N. Venkatraman [2010]<br />42<br />
  43. 43. Key layers of capabilities in music (analog era) <br />CustomerNetwork<br />Albums and tapes borrowed withinfriends communities.<br />Channel<br />Sold in Physical outlets (general and specialty) & Mail-order Catalogs <br />Content(music)<br />Albums offered by record labelsin standard formats (33-45-78 rpm; & cassette tapes)<br />Hardware<br />Turntables, cassette players, tape decks, Sony Walkman etc.<br />(c) N. Venkatraman [2010]<br />43<br />
  44. 44. Precursor to today’s social network?<br />CustomerNetwork<br />P2P file sharing; personal CD burning and sharing with friends <br />Channel<br />Sold in stores (CDs); Rise of Onlinedownloads<br />Digital Rights Management<br />Apple Fairplay; Windows Play For Sure<br />Content(music)<br />Major lables plus rise of independent labels posting music online <br />Software<br />MP3; itunes; Windows Media; Quicktime; Realone etc.<br />Hardware<br />Digital audio players<br />(c) N. Venkatraman [2010]<br />44<br />Key layers of capabilities in music (digital era) <br />
  45. 45. Music in the network era……<br />CustomerNetwork<br />P2P file sharing; personal CD burning; social and automated recommendations <br />Channel<br />Sold in stores (CDs); Online downloads;downloaded to phones; Networked streaming<br />MobileOperators<br />Mobile network for accessing music<br />Content(music)<br />CDS offered by major labels; rise of independent labels; <br />Digital Rights Management<br />Apple Fairplay; Windows Play For Sure:Open Mobile Alliance (OMA)<br />Software<br />MP3; Apple itunes; Windows Media; Quicktime; Realone etc.<br />Hardware<br />Multiple network-enabled devices<br />45<br />(c) N. Venkatraman [2010]<br />
  46. 46. Network of linkages in music<br />(c) N. Venkatraman [2010]<br />46<br />Customer Network<br />Mobile Operators<br />Channel<br />Content<br />Applications<br />Operating System<br />Hardware<br />
  47. 47. Apple App Store: Extension of iTunes Store<br />(c) N. Venkatraman [2010]<br />47<br />
  48. 48. From iPod to iPhone<br />(c) N. Venkatraman [2010]<br />48<br />
  49. 49. From iPhone to iPad<br />(c) N. Venkatraman [2010]<br />49<br />Cross-network disruption @scale<br />IT-enabled business advantage<br />
  50. 50. From iPadto iad<br />(c) N. Venkatraman [2010]<br />50<br />
  51. 51. Then there’s the TV Space… with apps<br />(c) N. Venkatraman [2010]<br />51<br />
  52. 52. Overview<br />(c) N. Venkatraman [2010]<br />52<br />
  53. 53. Opportunities & Challenges<br />53<br />(c) N. Venkatraman [2010]<br />Pervasiveness of IT (beyond processes)<br />Disruption @ Scale <br />Power of data and insights<br />Dynamic co-creation and innovation<br />Shifts in creation and capture of value<br />Strategy@<br />Nexus of Networks<br />
  54. 54. In closing……<br />(c) N. Venkatraman [2010]<br />54<br />“The difficulty lies not so much in developing new ideas as in escaping from old ones.”<br />John M. Keynes<br />
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