Michael Porter’s influence on strategic management can hardly be overemphasized. While his work has come under increasing criticism, it remains vitally relevant. Porter has been able to answer much of the criticism, but the critics have also been able to spot some holes in Porter’s frameworks.
In this post, I will examine Porter’s main frameworks for strategic analysis, the five forces analysis (industry analysis) and value chain analysis (relative analysis), and point a way towards a “Porter plus” approach that uses Porter’s frameworks as a basis, but adjusts and augments them with crucial insights from others, notably on dynamic capabilities.
For a comprehensive view on Porter’s strategic thinking that spans a large number of books and articles, I recommend Joan Magretta’s Understanding Michael Porter: The Essential Guide to Competition and Strategy, which collects and updates Porter’s thinking up to 2011. It also points at some of the criticism directed at Porter, although perhaps not to the most important pieces.
Continue reading “A Porter plus approach to strategic analysis”
Massively open online courses (MOOC) are changing the field of education. As most courses are offered for free, the big question is what is the motivation for the course providers to go through all the work of creating the materials for such a course.
In this post, I will take a deep dive inside a successful implementation of a MOOC: The Foundations of Business Strategy course offered by the University of Virginia’s Darden School of Business. I will explore the business model of this course as well as summarize and review its contents.
Continue reading “Foundations of Business Strategy and Strategist’s Toolkit”
The battle between Amazon and Hachette, one of the big five book publishers in the USA, has been going on for months now. The most visible effect of the battle so far has been Amazon’s delays in shipping and removal of pre-order buttons for some Hachette titles.
Originally, the battle was portrayed as being fought over ebook prices for the most part, but recently more information has surfaced on Amazon demanding payment for various services, such as pre-order buttons, personalized recommendations, and a dedicated employee at Amazon for Hachette books.
What is going on? In order to grasp the situation, it is useful to look at what has happened in the publishing industry in the past few years, and a useful lens for exploring this is Michael Porter’s five competitive forces.
Continue reading “Why is Amazon battling Hachette? It’s deeper than you think”
Lego has been subject to significant criticism for perpetuating gender stereotypes since its introduction of the Lego Friends series in 2011. Furthermore, while the recent Lego Movie has received almost universal praise, most articles that examine it from a gender point of view remain critical.
In this post, I will examine how Lego Friends and Lego Movie both act as crucial parts of fulfilling Lego’s mission, to “inspire and develop the builders of tomorrow,” and how the criticism aimed against them lacks a big-picture view of how they carry out Lego’s mission.
Continue reading “Lego Movie, Friends, and the struggle to nurture creativity”
How important are various forms of innovation to a company? Gary Pisano, a professor at the Harvard Business School, recently wrote an article called In Defense of Routine Innovation on Harvard Business Review, in which he argues that the vast majority of profits come from sustaining innovation, not disruptive innovation. His examples include Intel and Microsoft, giants who have been making the majority of their profits from sustaining innovations for the past two decades.
While Pisano does point out that disruptive innovation is also needed, none of his examples really serve to bring this point home. To get a better perspective on this, it is useful to take a look at a company with a slightly longer history. The case I have in mind is Lego.
Continue reading “Sustaining innovation and disruptive innovation – case Lego”
While still taking fledgling steps, reshoring seems to be bringing manufacturing and related jobs back to the USA. However, the phenomenon does not seem to be taking place in the rest of the developed world. This raises the question, why does it happen in the US? What is the difference? In this post, I will seek answers to these questions.
Continue reading “Why is reshoring happening in the USA, but not elsewhere?”