1. Update: 03/03/14
1Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Achieving Escape Velocity
Note â first 29 slides are the âannotatedâ
version from March 3, 2014 â slides
30-57 are the âcleanâ version
Video: 10-Minute Video Clip of Michael Eckhardt's
Executive Overview for Silicon Valley tech companies:
âStrategic Marketing of Breakthrough Products + Servicesâ
Chasm Institute Palo Alto, CA
Also â a 10-min. YouTube video clip of Michael Eckhardt:
Update: 03/03/14
2Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
2014
Edition
Escape Velocity Keynote
Free Your Companyâs Future From The Pull Of The Past
... a focused session for SBODN, by Chasm Instituteâs Managing Director, Michael Eckhardt, who will
provide OD consultants (internal or external) -- with strategy tools + frameworks from his companyâs newest
book, Escape Velocity -- to help executives and other stakeholders drive disruptive market innovation in
new breakthrough areas during 2014-2016, while also continuing to succeed in their existing mature markets.
For: South Bay
Organizational
Development Network
March 3, 2014
Keynote Speaker:
Michael Eckhardt
Managing Director
2. Update: 03/03/14
3Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Update: 03/03/14
4Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Many technology-based companies have enjoyed success in their
mature mainstream markets for 5 or 10 or even 20+ years â these
include Microsoft, IBM, Oracle, Nokia, as well as HP and Intel.
To remain competitive, however, these companies must accomplish
two challenging objectives simultaneously:
ď¨ maintain + protect their mature mainstream businesses
ď¨ while achieving âEscape Velocityâ with breakthrough market initiatives
fueled by new customer expectations / new business models / new innovations
---------------
The âEscape Velocityâ session provides OD leaders + experts with:
ď¨ a briefing on the specific strategies and tactics needed to achieve a sustainable +
profitable entry with new market innovations, while remaining competitive in their
mature business. As the March 3rd session will describe, this requires dramatically
different executive coaching / skills / mindset / metrics / actions.
Escape Velocity examples:
Successes â IBM (from hardware to software + services); Apple (from desktops to mobile ecosystem)
Failures â Nokia (from basic mobile phones to smart phones); Kodak (from analog to digital)
Currently in Process â Oracle (from on-premise to cloud); Adobe (from installed s/w to online s/w)
âEscape Velocityâ Is Only Important If You
Want to Remain Competitive in the Future
3. Update: 03/03/14
5Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Professional Background of Program Leader
Michael Eckhardt â Managing Director at Chasm Institute, is a
veteran of Hewlett-Packard, Pepsico, and Price Waterhouse.
An MBA graduate of Harvard Business School and Wall Street Journal
Award winner, Michael Eckhardt is a recognized expert in both strategic
innovation & high-tech market success. He provides clients:
ď¨ in Silicon Valley, the US, and Europe / Asia-Pacific
ď¨ with strategy workshops & practical market-centric innovation tools
ď¨ for gaining (+ sustaining) leadership positions in highly-competitive markets
Michael Eckhardt has worked with over 90 technology-based businesses in
19 countries. Founded in 1993, our clients include: Intel, Cisco, Adobe, HP,
AT&T Wireless, SAP, Agilent Technologies, Micron, LMC Data Systems,
NetApp, Autodesk, Plantronics, Mentor Graphics, and other high-tech leaders.
His 3 primary areas of focus are: accelerating market success, predicting customer reaction
to new product introâs, and achieving âEscape Velocityâ / driving profitable innovation.
Michael Eckhardt and his Chasm Institute senior team have worked on market strategy
for winning products, services and solutions in North America and worldwide. Geoffrey
Moore is Chairman Emeritus of Chasm Institute, and Eckhardt has edited + contributed
to several of Mooreâs best selling high-tech strategy books, including the newest book
entitled Escape Velocity â Free Your Companyâs Future From The Pull Of The Past.
Chasm Institute provides these advanced workshops to executives + teams:
âGo-to-Market Successâ âAccelerating Sales thru Marketingâ
âAchieving Escape Velocityâ âWinning in Mature Marketsâ
... for more information please visit Michael Eckhardtâs LinkedIn site or click on: www.chasminstitute.com
Global Thought Leadership.
Proven Impact.
Update: 03/03/14
6Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
September 2013: Outgoing CEO Steve Ballmer was
brutally honest at Microsoftâs financial analysts meeting
Thursday, admitting that the software giant has allowed
the booming mobile market to pass it by.
âMobile devices, we have almost no share,â Ballmer said
during the speech. âI donât know whether to say that with
enthusiasm or kind of uncomfortable tension, but Iâm an
optimistic guy.â
Despite his buoyant attitude, Ballmer did say during a Q&A session that he regretted decisions
made early in his reign as CEO.
âIf thereâs one thing I guess you would say I regret, I regret that there was a period in the early
2000s when we were so focused on what to do around Windows (our mature product line), that
we werenât able to redeploy talent / resources to the new category called smart phones,â he said.
âThat would probably be the thing I would tell you I regret the most, because the time we missed
was during the period we were working on what became Vista, and I wish weâd had our resources
differently deployed, let me say, during the early 2000s. It would have been better for Windows
and better for our success in other (newer) mobile categories, like smart phones and tablets.â
Is Achieving âEscape Velocityâ Important ?
Note: article edited for clarity + brevity
4. Update: 03/03/14
7Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Many technology-based companies have enjoyed success in their
mature mainstream markets for 5 or 10 or even 20+ years â these
include Microsoft, IBM, Oracle, Nokia, as well as HP and Intel.
To remain competitive, however, these companies must accomplish
two challenging objectives simultaneously:
ď¨ maintain + protect their mature mainstream businesses
ď¨ while achieving âEscape Velocityâ with breakthrough market initiatives
fueled by new customer expectations / new business models / new innovations
---------------
The âEscape Velocityâ session provides OD leaders + experts with:
ď¨ a briefing on the specific strategies and tactics needed to achieve a sustainable +
profitable entry with new market innovations, while remaining competitive in their
mature business. As the March 3rd session will describe, this requires dramatically
different executive coaching / skills / mindset / metrics / actions.
Escape Velocity examples:
Successes â IBM (from hardware to software + services); Apple (from desktops to mobile ecosystem)
Failures â Nokia (from basic mobile phones to smart phones); Kodak (from analog to digital)
Currently in Process â Oracle (from on-premise to cloud); Adobe (from installed s/w to online s/w)
âEscape Velocityâ Is Only Important If You
Want to Remain Competitive in the Future
Our newest book
1990
1995
2001
2006
Chasm Institute âEscape Velocityâ expertise is based on:
⢠our 500+ engagements with Silicon Valley clients
⢠our 5 best-selling strategy books for tech companies
⢠our global Thought Leadership on driving profitable innovation
5. Update: 03/03/14
9Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
The Hierarchy of Powers
... these 5 powers are the engines for driving Escape Velocity
Category Power
Company Power
Market Power
Offer Power
Execution Power
Chasm Institute has analyzed Escape Velocity examples
and âBest & Worstâ practices from many of these companies:
6. Update: 03/03/14
11Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
The Hierarchy of Powers
Category Power
Company Power
Market Power
Offer Power
Execution Power
Growth rates of your major categories
Status relative to your reference competitors
Market share in strategic target segments
Net differentiation of your flagship offers
Ability to drive changes to tipping points
Align these 5 to achieve escape velocity
Update: 03/03/14
12Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
The Hierarchy of Powers
... Which of these 5 powers does Gxxxxx PLS have today?
Category Power
Company Power
Market Power
Offer Power
Execution Power
7. Update: 03/03/14
13Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
The Hierarchy of Powers
How much power does Gxxxxx PLS have today?
Category Power
Company Power
Market Power
Offer Power
Execution Power
Are we in hot high-growth categories, or do we have
category envy?
Are we leveraging our crown jewels and allocating our
resources to create sustainable competitive
advantage?
Are we winning in key target markets and are we
winning them fast enough?
Do our core offers set the bar, or are we playing a lot of
catch-up?
Can we make stuff happen and make it stick, or are we
continually pushing the reset button?
Update: 03/03/14
14Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Where are key parts of our PLS portfolio competing on the Tech Market Model ?
Once weâve gained accurate answers to the above question, we can
then move forward in 2014-2015 with greater certainty + less risk:
(1) about what we should and should not do in the market
(2) based on the specific market stage we are competing in.
?
?
?
? ?
?
?
?
Category Power
... will change across the Tech Market Model
8. Update: 03/03/14
15Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Competitor 2
*
Competitor 1
*
Competitor 3*
YOU*
*
Competitive Set
Create unmatchable
capability via your core
vector of innovation
Redefine pecking order for
the category by setting a
new standard
Over-invest to the point
that competitors cannot or
will not follow
Leverage your crown jewels
to amplify your power
Company Power
The Escape Velocity Model
Core
Update: 03/03/14
16Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
1 Target Customer
2
Compelling Reason
to Buy
3 Whole Product
4 Partners & Allies
5 Sales Strategy
6 Pricing Strategy
7 Competition
8 Positioning / Messaging
9 Next Target
Target Customer Definition / Size & Growth Forecast
Customer Motivation Analysis
Whole Product Completeness
Partner Alignment
Sales Channel Readiness (direct sales force and / or indirect)
Customer ROI / Partner Financials / PLS Financial Goals
âMost Dangerous Competitor â Prioritization
Viral Power â into Adjacent Targets
Fit -to -TMM + 7-C âs Scoring
Market Power, Offer Power, Execution Power
The 9-Point Market Strategy Framework
9. Update: 03/03/14
17Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
The Hierarchy of Powers
... Different Responsibilities for Different Management Levels
Category Power
Company Power
Market Power
Offer Power
Execution Power
Key Business Teams
+ Marketing Teams
C-Level Execs +
Board of Directors
VPâs +
Group Directors
Update: 03/03/14
18Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Three Investment Horizons
Where Category Power Initiatives Gets Stuck
Horizon 1
ROI in 0 to 12 mos
Horizon 2
ROI in 12 to 36 mos
Horizon 3
ROI in 36 to 72 mos
Current
Categories
Meet
Performance
Commitments
Break-Out
Categories
On-board next
generation for
future growth
Future Category
Options
Develop options
for future
growth
Do well here
Do well here too
Sticking point
10. Update: 03/03/14
19Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Innovation Incubation Model
Itâs Not a Funnel. Itâs an Hourglass!
Horizon 3
Horizon 2
Horizon 1
Update: 03/03/14
20Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
The Race to Material Revenues
Rules of Thumb for Publicly Held Enterprises
⢠5% - 10% of Total Revenue = Revenue Materiality
⢠This is the exit threshold from H2 to H1
⢠0.5% - 1% of Total Revenue = On the Expense Radar
⢠This is the entry threshold from H3 to H2
⢠Horizon 2 Journey
⢠Grow one order of magnitude in 12 quarters
⢠Be more than half way after 8 quarters
⢠Else fold back into the base business and move on
Horizon 2 is not a stable state
Must race to get through, or die
11. Update: 03/03/14
21Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Meeting the Horizon 2 Challenge
New Prescriptions in Five Key Areas
⢠Number of H2 Initiatives
⢠Planning & Budgeting
⢠Organizational Structure
⢠Metrics
⢠Talent & Compensation
Based on venture capital ideas
Adapted to enterprise realities
Very sensitive issues
OUR 9-POINT PLAN
FOR Achieving ESCAPE VELOCITY
PLS Executive Overview
1 Target Customer
2
Compelling Reason
to Buy (the category)
3 Whole Product
4 Partners & Allies
5 Sales Strategy
6 Pricing Strategy
7 Competition
8 Positioning / Messaging
9 Next Target
Business Objective for this Gxxxxx PLS 9-Point Plan:
22
ďź
Key PLS Initiative or Solution:
TMM Stage: [ ] Early [ ] Mid [ ] Late
Time Period for this Plan: from to
Update: 03/03/14Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
ď
ď
ď
ď
12. Update: 10/24/13
23Š 2013 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Achieving Escape Velocity
... how can we gain momentum + minimize friction ?
ď´ Do we have the right team of people -- with the right skills and motivation
to complete this Escape Velocity initiative ?
ď´ Does this team have available to them the product, services, partnerships,
and other resources needed for success ?
ď´ Is the timeline realistic for bringing this product / solution / initiative to
market, in order to meet the window of customer opportunity ?
ď´ Are there any âspeed bumpsâ or barriers that we need to address immediately ?
ď´ Can we bring our product or solution to market at a price which will make it
competitive in the eyes of our target customers ?
ď´ Will the forecast Return On Investment (ROI) make this a successful
project based on internal metrics ?
ď´ Is the organization aligned and focused with a âWill to Winâ with this
initiative ?
Bottom Line -- Are there any steps we can take now to increase
the probability of success as we go to market ?
8 Key Criteria for Driving Successful Escape Velocity Results
Update: 03/03/14
24Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Initial excitement by
visionary customers
1
Disparate pilot
projects yielding
weak traction
2
Highly focused
demand ... only
15% of sales reps
can sell here
3
The winners from
Tornado will dominate
profits + margin share
game here
5-a
Industry + category
consolidation
accelerates
5-c
45% growth rate for
the category â crucial
market share war begins
4
Steady market:
70% to 90% of
sales = repurchase by
existing customers
5-b
5-d
Displacement by
newer category
The Tech Market Model 2.0
What are 8 Key Patterns in high-tech ?
13. 1 Target Customer
2
Compelling Reason
to Buy (the category)
3 Whole Product
4 Partners & Allies
5 Sales Strategy
6 Pricing Strategy
7 Competition
8 Positioning / Messaging
9 Next Target
Business Objective for this Plan:
Major Escape Velocity challenges to overcome:
25Update: 03/03/14
Key PLS Initiative or Solution:
â Needs Major Attention
â Caution: Still Needs More Focus
â On Plan
Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
ď
ď
Due Date ď¨ 02 / 28 / 2014 03 / 31 / 2014 04 / 30 / 2014
9-Point Dashboard
2014 Performance-to-Plan
Action:
Owner:
Action:
Owner:
Action:
Owner:
Action:
Owner:
Action:
Owner:
Action:
Owner:
Action:
Owner:
Action:
Owner:
Action:
Owner:
Action:
Owner:
Action:
Owner:
ď
Update: 03/03/14
26Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Chasm Institute provides:
... tech-based companies with workshops,
tools + consulting to drive product line
success by leveraging --
âş our best-selling books, authored by
Chasm Institute Chairman Geoffrey Moore
âş and our 15+ years of work in Silicon Valley
Chasm Institute helps:
ď§ tech companies drive profitable growth
ď§ key managers operationalize their strategy
ď§ teams in product management, R&D,
marketing + sales achieve market success
14. Update: 03/03/14
27Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Here are 5 ways to engage with Chasm Institute:
1.5 days
3 to 4 months
Ideal for
helping CEOâs and
senior managers
accelerate results
in their strategic
growth initiatives
Ideal for
o product+business
teams seeking
to gain new
tools / methods
o management
retreats or off-site
planning meetings
Books
+
Blogs
Keynote
Speeches
Executive
Briefing
Sessions
Action
Workshops
Break-Out
Growth
Projects
60 mins
4 hrs
Ideal for
key conferences +
trade show events
Ideal for
senior leadership
planning meetings
Update: 03/03/14
28Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
ď´Chasm Institute provides
workshops + tools for
helping tech-based companies
achieve product and service
success in tough, highly
competitive markets
ď´Workshops are based on these
best-selling business books by
Chasm Instituteâs Chairman
Emeritus, Geoffrey Moore:
Chasm Institute LLC
Palo Alto, California
Tel: 650-537-6742
Fax: 650-599-9338
Angela Martinez
Programs Manager
amartinez@chasminstitute.com
Michael Eckhardt
Managing Director
meckhardt@chasminstitute.com
For More Information on Chasm Institute
Workshops For Your Business Team:
15. Update: 03/03/14
29Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Chasm Institute Copyright Notice
⢠Copyright Š2014, Chasm Institute LLC. All rights reserved.
⢠This presentation is provided to you solely for informational
purposes and does not constitute conveyance of any intellectual
property rights.
⢠Chasm Institute LLC has created materials, methodologies and
practices that are proprietary. All intellectual property associated
with these works and any derivative works that come as a result
of any Client engagement shall remain the property of Chasm
Institute LLC.
⢠This presentation may not be reproduced or redistributed, in
whole or in part, without the prior consent of Chasm Institute LLC.
Update: 03/03/14
30Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
2014
Edition
Escape Velocity Keynote
Free Your Companyâs Future From The Pull Of The Past
... a focused session for SBODN, by Chasm Instituteâs Managing Director, Michael Eckhardt, who will
provide OD consultants (internal or external) -- with strategy tools + frameworks from his companyâs newest
book, Escape Velocity -- to help executives and other stakeholders drive disruptive market innovation in
new breakthrough areas during 2014-2016, while also continuing to succeed in their existing mature markets.
For: South Bay
Organizational
Development Network
March 3, 2014
Keynote Speaker:
Michael Eckhardt
Managing Director
16. Update: 03/03/14
31Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Update: 03/03/14
32Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Many technology-based companies have enjoyed success in their
mature mainstream markets for 5 or 10 or even 20+ years â these
include Microsoft, IBM, Oracle, Nokia, as well as HP and Intel.
To remain competitive, however, these companies must accomplish
two challenging objectives simultaneously:
ď¨ maintain + protect their mature mainstream businesses
ď¨ while achieving âEscape Velocityâ with breakthrough market initiatives
fueled by new customer expectations / new business models / new innovations
---------------
The âEscape Velocityâ session provides OD leaders + experts with:
ď¨ a briefing on the specific strategies and tactics needed to achieve a sustainable +
profitable entry with new market innovations, while remaining competitive in their
mature business. As the March 3rd session will describe, this requires dramatically
different executive coaching / skills / mindset / metrics / actions.
Escape Velocity examples:
Successes â IBM (from hardware to software + services); Apple (from desktops to mobile ecosystem)
Failures â Nokia (from basic mobile phones to smart phones); Kodak (from analog to digital)
Currently in Process â Oracle (from on-premise to cloud); Adobe (from installed s/w to online s/w)
âEscape Velocityâ Is Only Important If You
Want to Remain Competitive in the Future
17. Update: 03/03/14
33Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Professional Background of Program Leader
Michael Eckhardt â Managing Director at Chasm Institute, is a
veteran of Hewlett-Packard, Pepsico, and Price Waterhouse.
An MBA graduate of Harvard Business School and Wall Street Journal
Award winner, Michael Eckhardt is a recognized expert in both strategic
innovation & high-tech market success. He provides clients:
ď¨ in Silicon Valley, the US, and Europe / Asia-Pacific
ď¨ with strategy workshops & practical market-centric innovation tools
ď¨ for gaining (+ sustaining) leadership positions in highly-competitive markets
Michael Eckhardt has worked with over 90 technology-based businesses in
19 countries. Founded in 1993, our clients include: Intel, Cisco, Adobe, HP,
AT&T Wireless, SAP, Agilent Technologies, Micron, LMC Data Systems,
NetApp, Autodesk, Plantronics, Mentor Graphics, and other high-tech leaders.
His 3 primary areas of focus are: accelerating market success, predicting customer reaction
to new product introâs, and achieving âEscape Velocityâ / driving profitable innovation.
Michael Eckhardt and his Chasm Institute senior team have worked on market strategy
for winning products, services and solutions in North America and worldwide. Geoffrey
Moore is Chairman Emeritus of Chasm Institute, and Eckhardt has edited + contributed
to several of Mooreâs best selling high-tech strategy books, including the newest book
entitled Escape Velocity â Free Your Companyâs Future From The Pull Of The Past.
Chasm Institute provides these advanced workshops to executives + teams:
âGo-to-Market Successâ âAccelerating Sales thru Marketingâ
âAchieving Escape Velocityâ âWinning in Mature Marketsâ
... for more information please visit Michael Eckhardtâs LinkedIn site or click on: www.chasminstitute.com
Global Thought Leadership.
Proven Impact.
Update: 03/03/14
34Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
September 2013: Outgoing CEO Steve Ballmer was
brutally honest at Microsoftâs financial analysts meeting
Thursday, admitting that the software giant has allowed
the booming mobile market to pass it by.
âMobile devices, we have almost no share,â Ballmer said
during the speech. âI donât know whether to say that with
enthusiasm or kind of uncomfortable tension, but Iâm an
optimistic guy.â
Despite his buoyant attitude, Ballmer did say during a Q&A session that he regretted decisions
made early in his reign as CEO.
âIf thereâs one thing I guess you would say I regret, I regret that there was a period in the early
2000s when we were so focused on what to do around Windows (our mature product line), that
we werenât able to redeploy talent / resources to the new category called smart phones,â he said.
âThat would probably be the thing I would tell you I regret the most, because the time we missed
was during the period we were working on what became Vista, and I wish weâd had our resources
differently deployed, let me say, during the early 2000s. It would have been better for Windows
and better for our success in other (newer) mobile categories, like smart phones and tablets.â
Is Achieving âEscape Velocityâ Important ?
Note: article edited for clarity + brevity
18. Update: 03/03/14
35Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Many technology-based companies have enjoyed success in their
mature mainstream markets for 5 or 10 or even 20+ years â these
include Microsoft, IBM, Oracle, Nokia, as well as HP and Intel.
To remain competitive, however, these companies must accomplish
two challenging objectives simultaneously:
ď¨ maintain + protect their mature mainstream businesses
ď¨ while achieving âEscape Velocityâ with breakthrough market initiatives
fueled by new customer expectations / new business models / new innovations
---------------
The âEscape Velocityâ session provides OD leaders + experts with:
ď¨ a briefing on the specific strategies and tactics needed to achieve a sustainable +
profitable entry with new market innovations, while remaining competitive in their
mature business. As the March 3rd session will describe, this requires dramatically
different executive coaching / skills / mindset / metrics / actions.
Escape Velocity examples:
Successes â IBM (from hardware to software + services); Apple (from desktops to mobile ecosystem)
Failures â Nokia (from basic mobile phones to smart phones); Kodak (from analog to digital)
Currently in Process â Oracle (from on-premise to cloud); Adobe (from installed s/w to online s/w)
âEscape Velocityâ Is Only Important If You
Want to Remain Competitive in the Future
Our newest book
1990
1995
2001
2006
Chasm Institute âEscape Velocityâ expertise is based on:
⢠our 500+ engagements with Silicon Valley clients
⢠our 5 best-selling strategy books for tech companies
⢠our global Thought Leadership on driving profitable innovation
19. Update: 03/03/14
37Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
The Hierarchy of Powers
... these 5 powers are the engines for driving Escape Velocity
Category Power
Company Power
Market Power
Offer Power
Execution Power
Chasm Institute has analyzed Escape Velocity examples
and âBest & Worstâ practices from many of these companies:
20. Update: 03/03/14
39Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
The Hierarchy of Powers
Category Power
Company Power
Market Power
Offer Power
Execution Power
Growth rates of your major categories
Status relative to your reference competitors
Market share in strategic target segments
Net differentiation of your flagship offers
Ability to drive changes to tipping points
Align these 5 to achieve escape velocity
Update: 03/03/14
40Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
The Hierarchy of Powers
... Which of these 5 powers does Gxxxxx PLS have today?
Category Power
Company Power
Market Power
Offer Power
Execution Power
21. Update: 03/03/14
41Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
The Hierarchy of Powers
How much power does Gxxxxx PLS have today?
Category Power
Company Power
Market Power
Offer Power
Execution Power
Are we in hot high-growth categories, or do we have
category envy?
Are we leveraging our crown jewels and allocating our
resources to create sustainable competitive
advantage?
Are we winning in key target markets and are we
winning them fast enough?
Do our core offers set the bar, or are we playing a lot of
catch-up?
Can we make stuff happen and make it stick, or are we
continually pushing the reset button?
Update: 03/03/14
42Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Where are key parts of our PLS portfolio competing on the Tech Market Model ?
Once weâve gained accurate answers to the above question, we can
then move forward in 2014-2015 with greater certainty + less risk:
(1) about what we should and should not do in the market
(2) based on the specific market stage we are competing in.
?
?
?
? ?
?
?
?
Category Power
... will change across the Tech Market Model
22. Update: 03/03/14
43Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Competitor 2
*
Competitor 1
*
Competitor 3*
YOU*
*
Competitive Set
Create unmatchable
capability via your core
vector of innovation
Redefine pecking order for
the category by setting a
new standard
Over-invest to the point
that competitors cannot or
will not follow
Leverage your crown jewels
to amplify your power
Company Power
The Escape Velocity Model
Core
Update: 03/03/14
44Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
1 Target Customer
2
Compelling Reason
to Buy
3 Whole Product
4 Partners & Allies
5 Sales Strategy
6 Pricing Strategy
7 Competition
8 Positioning / Messaging
9 Next Target
Target Customer Definition / Size & Growth Forecast
Customer Motivation Analysis
Whole Product Completeness
Partner Alignment
Sales Channel Readiness (direct sales force and / or indirect)
Customer ROI / Partner Financials / PLS Financial Goals
âMost Dangerous Competitor â Prioritization
Viral Power â into Adjacent Targets
Fit -to -TMM + 7-C âs Scoring
Market Power, Offer Power, Execution Power
The 9-Point Market Strategy Framework
23. Update: 03/03/14
45Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
The Hierarchy of Powers
... Different Responsibilities for Different Management Levels
Category Power
Company Power
Market Power
Offer Power
Execution Power
Key Business Teams
+ Marketing Teams
C-Level Execs +
Board of Directors
VPâs +
Group Directors
Update: 03/03/14
46Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Three Investment Horizons
Where Category Power Initiatives Gets Stuck
Horizon 1
ROI in 0 to 12 mos
Horizon 2
ROI in 12 to 36 mos
Horizon 3
ROI in 36 to 72 mos
Current
Categories
Meet
Performance
Commitments
Break-Out
Categories
On-board next
generation for
future growth
Future Category
Options
Develop options
for future
growth
Do well here
Do well here too
Sticking point
24. Update: 03/03/14
47Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Innovation Incubation Model
Itâs Not a Funnel. Itâs an Hourglass!
Horizon 3
Horizon 2
Horizon 1
Update: 03/03/14
48Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
The Race to Material Revenues
Rules of Thumb for Publicly Held Enterprises
⢠5% - 10% of Total Revenue = Revenue Materiality
⢠This is the exit threshold from H2 to H1
⢠0.5% - 1% of Total Revenue = On the Expense Radar
⢠This is the entry threshold from H3 to H2
⢠Horizon 2 Journey
⢠Grow one order of magnitude in 12 quarters
⢠Be more than half way after 8 quarters
⢠Else fold back into the base business and move on
Horizon 2 is not a stable state
Must race to get through, or die
25. Update: 03/03/14
49Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Meeting the Horizon 2 Challenge
New Prescriptions in Five Key Areas
⢠Number of H2 Initiatives
⢠Planning & Budgeting
⢠Organizational Structure
⢠Metrics
⢠Talent & Compensation
Based on venture capital ideas
Adapted to enterprise realities
Very sensitive issues
OUR 9-POINT PLAN
FOR Achieving ESCAPE VELOCITY
PLS Executive Overview
1 Target Customer
2
Compelling Reason
to Buy (the category)
3 Whole Product
4 Partners & Allies
5 Sales Strategy
6 Pricing Strategy
7 Competition
8 Positioning / Messaging
9 Next Target
Business Objective for this Gxxxxx PLS 9-Point Plan:
50
ďź
Key PLS Initiative or Solution:
TMM Stage: [ ] Early [ ] Mid [ ] Late
Time Period for this Plan: from to
Update: 03/03/14Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
ď
ď
ď
ď
26. Update: 10/24/13
51Š 2013 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Achieving Escape Velocity
... how can we gain momentum + minimize friction ?
ď´ Do we have the right team of people -- with the right skills and motivation
to complete this Escape Velocity initiative ?
ď´ Does this team have available to them the product, services, partnerships,
and other resources needed for success ?
ď´ Is the timeline realistic for bringing this product / solution / initiative to
market, in order to meet the window of customer opportunity ?
ď´ Are there any âspeed bumpsâ or barriers that we need to address immediately ?
ď´ Can we bring our product or solution to market at a price which will make it
competitive in the eyes of our target customers ?
ď´ Will the forecast Return On Investment (ROI) make this a successful
project based on internal metrics ?
ď´ Is the organization aligned and focused with a âWill to Winâ with this
initiative ?
Bottom Line -- Are there any steps we can take now to increase
the probability of success as we go to market ?
8 Key Criteria for Driving Successful Escape Velocity Results
Update: 03/03/14
52Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Initial excitement by
visionary customers
1
Disparate pilot
projects yielding
weak traction
2
Highly focused
demand ... only
15% of sales reps
can sell here
3
The winners from
Tornado will dominate
profits + margin share
game here
5-a
Industry + category
consolidation
accelerates
5-c
45% growth rate for
the category â crucial
market share war begins
4
Steady market:
70% to 90% of
sales = repurchase by
existing customers
5-b
5-d
Displacement by
newer category
The Tech Market Model 2.0
What are 8 Key Patterns in high-tech ?
27. 1 Target Customer
2
Compelling Reason
to Buy (the category)
3 Whole Product
4 Partners & Allies
5 Sales Strategy
6 Pricing Strategy
7 Competition
8 Positioning / Messaging
9 Next Target
Business Objective for this Plan:
Major Escape Velocity challenges to overcome:
53Update: 03/03/14
Key PLS Initiative or Solution:
â Needs Major Attention
â Caution: Still Needs More Focus
â On Plan
Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
ď
ď
Due Date ď¨ 02 / 28 / 2014 03 / 31 / 2014 04 / 30 / 2014
9-Point Dashboard
2014 Performance-to-Plan
Action:
Owner:
Action:
Owner:
Action:
Owner:
Action:
Owner:
Action:
Owner:
Action:
Owner:
Action:
Owner:
Action:
Owner:
Action:
Owner:
Action:
Owner:
Action:
Owner:
ď
Update: 03/03/14
54Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Chasm Institute provides:
... tech-based companies with workshops,
tools + consulting to drive product line
success by leveraging --
âş our best-selling books, authored by
Chasm Institute Chairman Geoffrey Moore
âş and our 15+ years of work in Silicon Valley
Chasm Institute helps:
ď§ tech companies drive profitable growth
ď§ key managers operationalize their strategy
ď§ teams in product management, R&D,
marketing + sales achieve market success
28. Update: 03/03/14
55Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Here are 5 ways to engage with Chasm Institute:
1.5 days
3 to 4 months
Ideal for
helping CEOâs and
senior managers
accelerate results
in their strategic
growth initiatives
Ideal for
o product+business
teams seeking
to gain new
tools / methods
o management
retreats or off-site
planning meetings
Books
+
Blogs
Keynote
Speeches
Executive
Briefing
Sessions
Action
Workshops
Break-Out
Growth
Projects
60 mins
4 hrs
Ideal for
key conferences +
trade show events
Ideal for
senior leadership
planning meetings
Update: 03/03/14
56Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
ď´Chasm Institute provides
workshops + tools for
helping tech-based companies
achieve product and service
success in tough, highly
competitive markets
ď´Workshops are based on these
best-selling business books by
Chasm Instituteâs Chairman
Emeritus, Geoffrey Moore:
Chasm Institute LLC
Palo Alto, California
Tel: 650-537-6742
Fax: 650-599-9338
Angela Martinez
Programs Manager
amartinez@chasminstitute.com
Michael Eckhardt
Managing Director
meckhardt@chasminstitute.com
For More Information on Chasm Institute
Workshops For Your Business Team:
29. Update: 03/03/14
57Š 2014 Chasm Institute Contact: Angela Martinez amartinez@chasminstitute.com
All rights reserved. Contents may not be reproduced in any form without prior written permission.
Chasm Institute Copyright Notice
⢠Copyright Š2014, Chasm Institute LLC. All rights reserved.
⢠This presentation is provided to you solely for informational
purposes and does not constitute conveyance of any intellectual
property rights.
⢠Chasm Institute LLC has created materials, methodologies and
practices that are proprietary. All intellectual property associated
with these works and any derivative works that come as a result
of any Client engagement shall remain the property of Chasm
Institute LLC.
⢠This presentation may not be reproduced or redistributed, in
whole or in part, without the prior consent of Chasm Institute LLC.