Livewire

I have been exploring the concept of co-dependent strategies for awhile and thought I'll throw it up for some discussion here.

Co-dependent strategies explore the intrinsic integration of organizations with their supply chain and business partners. The communications service provider world has two distinct camps :

(a) the older incumbents leveraging a unilateral approach with linear control over their supply chain, and a model that excludes partners from direct consumer interaction (CSP is the sole consumer aggregator) and

(b) some of the newer providers that are more nimble in market reaction - because they rely on content and device partners to independently touch the end consumer, while building mechanisms to integrate the partner's functions such as marketing, sales, operations and revenue generation into their own.

The linear, command-and-control structures work well when there is a strong requirement to drive costs out of operations or take proven, new initiatives into the mainstream. To handle the ambiguous challenges posed by current innovation/reaction cycles, do-it-alone approaches are infeasible - and require a degree of "organied chaos" (ala Google). 

Flexible co-dependent strategies are built around global value chains - to offer increased responsiveness to customer needs, tackle fluctuating human capital needs and increase competitive aggression. It also brings increased, multi-dimensional market intelligence to the table from several partners that interact with the consumer base. Focus shifts from consumer aggregation to complexity aggregation.

It requires for the service provider to introduce increased modularity and reusability in its business processes so they can be linked across organization boundaries.

Thoughts and comments welcome...

Posted by Deepak Padaki at 11:33 PM | Permalink | Comments (2) | TrackBacks (0)

I was reading an interview with Keith Pardy, SVP for Nokia's strategic marketing, published in a recent issue of the Mc.Kinsey Quarterly. Commenting on the fast paced nature of the mobile handset market, Mr.Pardy talks about how Nokia researches consumer behavior and segments their consumer base into 12 groups - each with its unique characteristic of what they would expect from a Nokia phone. He goes on to say that at any time, Nokia deals with releasing 50 products a year worldwide, each with a lifespan of 12-24 months.

The complexity of managing such a dynamic product line in the high-tech industry can be mindboggling...the backward and forward integration with supply-chains, the preciseness and simplification of marketing campaigns and the keen balancing of development and sustenance efforts.

Imagine my surprise then, when I read this article announcing Comcast's intention to begin selling cordless phone sets with enhanced features. The cable industry has been aggressive in their market statements of late - taking on the ILECs and their plans to enter the entertainment world (See this article from the 2007 Cable Show).

CableCos and telcos are faced with this new challenge: business models that were built around the notion of long-cycle product deployments are now obsolete. If consumer preferences change at lightning pace, will they be able to achieve time-to-market for their service innovations, like Nokia does with its product engineering? A recent survey of telco executives by Amdocs emphasizes the importance of good OSS to achieve time-to-market, but I think it goes beyond that. While automation is key,  nimbleness also requires seamless and quick information exchange across departments and partners. It requires intimate understanding of consumers - built through relationships rather than products.

Given their closeness, service providers can learn a lot from device suppliers about managing rapid product deployment.

Posted by Deepak Padaki at 07:22 PM | Permalink | Comments (0) | TrackBacks (0)