| 商家名称 |
信用等级 |
购买信息 |
订购本书 |
|
|
 |
Failsafe Strategies: Profit and Grow from Risks that Others Avoid |
 |
|
|
Failsafe Strategies: Profit and Grow from Risks that Others Avoid |
|
基本信息·出版社：Wharton School Publishing
·页码：312 页
·出版日期：2004年09月
·ISBN：0131011111
·条形码：9780131011113
·版本：第1版
·装帧：精装
·开本：16开 Pages Per Sheet
·外文书名：万全战略——从别人回避的风险中获利与成长.
内容简介 在线阅读本书
Pursue your best business opportunities—without the risk!
Today, many companies have become powerfully averse to taking the risks that are essential to long-term success. Dr. Sayan Chatterjee shows how to identify high-risk, high-return opportunities, and then systematically mitigate those risks up front, as you design your initiative. His techniques can help you safely pursue huge opportunities that others pass up—and sustain profit growth far into the future.
A complete framework for attacking high-risk, high-return opportunities
Powerful new tools for sustaining long-term growth and profitability
Clarifying and mitigating your real risks
Understanding what is visible to your customer and how that affects your risk
JetBlue vs. Southwest: More than one way to skin a cat
Identifying multiple competitive objectives, and multiple ways to achieve them
Tracking and reducing risks in real-time
Discovering mistakes in assumptions or logic while there's time to fix them
Creative ways to leverage existing resources more effectively
Reducing risk by avoiding unnecessary additional investments—and what to do when you can't
Execution: Getting your ducks in a row
Creating an organization that can deliver on your high-value, low-risk strategies
Reducing the hazards of growth and diversification strategies
Planning to grow or extend your core markets
Entering existing markets without the risk
Finding more effective ways to overcome entry barriers
Shaping new markets: products, processes, and platforms
What it takes to successfully create and dominate a new market
作者简介 Sayan Chatterjee, Ph.D. is Professor of Management Policy at the Weatherhead School of Management, Case Western Reserve University. He has been doing academic research on the sources of business risk since the early 1990s, and is now translating his breakthrough ideas into actionable information for business leaders and financial experts. In May 2003, he spoke at an invitation-only practitioner conference on risk organized by the London School of Economics. His works are used in the curriculum of the Harvard Business School and have been cited in most leading textbooks on strategy. He also consults with leading middle-market firms and global corporations.
媒体推荐 Introduction
UnderstandingRisk: The Real Key to Competitive Strategy
This book is aimed at practitioners andscholars of business strategy. Whether you are a CEO of an organization or afunctional level manager you need to understand not only how to take risks buthow to also navigate around the risks to capture the rewards that prompted therisk-taking in the first place. More importantly, you need to know your role inreducing these risks. You may argue that the responsibility of a strategy liesat the leadership suite but it is increasingly becoming apparent that thesuccess of a strategy is determined by how much the rank and file understandstheir role in the strategy. The risks in any strategy are not just in theexecution but also in the design.
The genesis of the book comes from theextensive executive education and consulting that we have been involved in overthe past 15 years. Many of our session participants have asked us to develop abook based on the concepts developed in these sessions. These concepts havebeen field tested and refined over the years through our consultingengagements. Teaching strategy to experienced executives in one or a two-daysession is an extremely different challenge than teaching strategy to MBAstudents over an entire semester. Executives are extremely intolerant aboutacademic theories that they cannot apply immediately to their day-to-dayconcerns. Our challenge therefore was to develop bite sized examples that couldhelp these executives to internalize the concepts that we were developing inthe sessions at the same time make the concepts generalizable to a wide rangeof business situations. Our solution was to write numerous short cases that abusy executive could read but still have enough detail to illustrate key concepts.You will find these short cases throughout this book. We are hoping tore-create the same experience that participants in our executive sessionstypically get from studying these cases and from the interactions
In theremainder of this Introduction, we will provide an overview of how the rest ofthe book is organized. The book has two broad sections and an appendix. Thefirst section develops concepts that will allow a firm to clearly understandthe nature of the risks in a given business. The second section expands thisframework to growth and diversification strategies. An appendix presents adetailed analysis of the rise and fall of Enron using the risk management lens.
An overview of the book
This bookdevelops a set of concepts that will allow you to design business models wherethe risks can be reduced to practical proportions. The risks in any businesscome from not knowing the demand, threat from competition and not having theappropriate capabilities1.The basic theme that will be repeated over and over again is that to reducerisk you need to have clarity regarding where the risks are and create choice,or options, in tackling the risk. We will use numerous examples of businessstrategies to illustrate the concepts. But more to the point we would like todemonstrate how the concepts developed in this book would have enabled you toquickly visualize the successful strategies as well avoid the mistakes.However, we are by no means claiming that the strategies that we use asexamples were developed using our frameworks. We are only too aware of muchacademic ?fter the fact?analysis of famous strategies that definitely do notportray the reality of how the strategies were developed. Notable examples areHonda, Wal-Mart and Southwest. Rather, we use these examples as ?xercises?hat will help you internalize our framework and methodology.
Section 1
Designing Strategies for Avoiding Risk
Businessrisks can manifest at two different stages. There will always be risks in theexecution of a strategy. However, quite often the risk is not in the executionbut in the design of the strategy that predisposes it to failure. Ouroperations colleagues tell us that 80% of the life-cycle cost of a car islocked in at the design stage. A well-designed strategy is not immune toexecution risks but very few firms consider capability risks at the designstage and thus compound the risks during execution2.A major thrust of this section is to demonstrate that quite often firms missout on strategies that can avoid or minimize capability risks while designingthe strategy. This is precisely the debate surrounding the Iraq liberation. Theproponents point to the goal of a democratic Iraq as a high return venture.Very few people can argue with this objective if it can be attained. However,critics contend that the strategy did not think through the capability risksand the objective may have been attainable at much less cost.
Chapter One
How to see gold where others see risk:Identify more choices to get the gold
In order to embraceventures that are considered to be too risky by others, you need to be moreproficient than your competitors in understanding the nature of the risksbefore you actually invest in a venture. In order to do this you need to have aframework that will allow you to understand the sources of risks at a highlevel and a methodology that will allow you to avoid, the risks that scaresyour competitors. The first step in this process is the ability toconceptualize multiple business models that can exploit the same marketopportunity. This chapter will give you a framework to identify options thatisolate your firm from key risks.
We call this framework?utcome to objective.?This framework will expose the inherent risk of relyingon core competencies and how this perspective leads to an inside-out view ofstrategy. This chapter will also demonstrate why giving lip service to customerneeds is not enough and how the concept of desired outcomes allows you to breakthe inside-out mindset. Finally, this chapter will show you how to identify multiple competitive objectives, the logic behind yourbusiness model, that can deliver the same desired outcome while capturing someof the value for your shareholders. When you begin to identify multiplecompetitive objectives you take the first step to put distance between you andyour competitors in your ability to profit from risky ventures. In summary,this framework will increase the odds of profits by enabling you to do twothings. First, it will allow you to consider opportunities that others wouldavoid because of the perceived risk and thus have the field to yourself.Second, you will be able to differentiate your firm from your competitors byreducing the likelihood of loss because you will have at your disposal manymore choices to avoid the risks than your competitors.
ChapterTwo:
Clarity in competitive objectives: threesteps to reduce risks
InChapter One you will have been exposed to techniques for visualizing multiplepossibilities for exploiting the same risky profit opportunity ?the choicedimension. Chapter Two will force you to come to grips with the constraints inexploiting these possibilities ?the clarity dimension. Chapter Two will guideyou through three steps to crystallize the constraints and the risks ofovercoming these constraints as you design the business model. At the end ofthis process you will have complete clarity as to what you need to deliver. This by no means suggests that you can deliver what you need to but at least you will nowhave better clarity about the risk that you may not be able to acquire therequired capabilities in order to deliver what you need to.
The firststep to develop this clarity is to understand the broad competitive objectiveby which a strategy will deliver value to the customer while capturing someof the value for the firm? shareholders.Hopefully, with the techniques developed in chapter one you will have many morebroad competitive objectives to choose from to profit from the same opportunitycompared to your competitors.
Afterdeciding on the initial broad competitive objectives you have to take the mostcritical next step of developing core competitive objectives. We define coreobjectives as a set of specific and measurable deliverables for the businessmodel. Using short sidebar examples, this chapter will show how to preciselydefine a strategy? core competitive objectives. This precision will give you amuch better clarity on the nature of the risks that you will be facing. Thisprecision will allow you to track the risks in real-time so that you can pullthe plug in case you made a mistake in your assumptions or logic before thestrategy completely unravels. The examples will also illustrate how companieshave overlooked the true risks of a business model when they didn't take timefor this precision. Finally, this precision is critical to clearly understandthe constraints a firm will be facing to deliver its objectives ?itscapability requirements. Basically, at this point you will have clear choicesabout what you can do. Many a strategyhas gone awry because of the lack of precision in defining the core objectives.With precise definitions you will be able to avoid the more risky options atthe design stage and not encounter the risks during execution.
Chapter Three:
Identifying multiple capabilityconfigurations
Inthis chapter, we develop techniques of how to identify alternative capabilityconfigurations that allows you to learn from a successful strategy and apply itin a different context. We demonstrate this by contrasting the strategies ofJetBlue and Southwest and how JetBlue? strategy has developed with verydifferent inner workings even though most people think it is basically similarto Southwest. This example should be helpful in understanding how twosuccessful companies in the same business can have different core objectivesand supporting capabilities. Further, we will also demonstrate that the samecore objectives can be used as the business logic in totally different industries.Clearly, the capabilities to deliver these objectives would vary across firmsin different industries, but if you can understand the common theme that isobservable across such strategies, you may be able to apply the same principleto your own business. We use five short sidebar examples to illustrate thispoint.
Chapter Four:
Designingstrategies with low capability risks
Upto this point you would have seen how to clearly understand the logic of abusiness model and how to identify many choices that can theoretically allow a firm to deliver value to its customers whilecapturing some of that value for itself. Basically, the book would havedeveloped frameworks to identify multiple options for what you need to do to beprofitable and what you can do. However, the risk becomes a reality when youselect one of these options and choose to implement it. Once you make a choicea firm has to make the necessary resource commitments to build up thecapabilities. In this chapter (and the next) you will learn how you canminimize your risk by using existing capabilities to deliver the coreobjectives that you have identified. So, if you can address the capabilityrisks efficiently your business model has a much higher probability of success.
Thischapter will also address the situations where a firm cannot leverage itsexisting capabilities. Those situations are inherently more risky because ofthe additional investments that have to be made for acquiring new capabilities.This chapter will give you some ideas as to how to identify ?hite space?nd/or ?weet spot?opportunities (we will define these terms later) where therisks of making such new investments are minimal.
Chapter Five
Lowering capability risks with visible andinvisible outputs
Acorollary to the frameworks that you will learn in this book istime-to-insight. Basically, if you can consistently identify business modelsfaster than your competitors, this by itself will allow you to stay a stepahead of competition. However, there are other things that you can do besidesdeveloping a completely new business model that will make it difficult forcompetitors to catch up with you. The framework that is developed in ChapterFive allows you to fine tune your firm? capabilities by simultaneously makingit more efficient, as well as deliver more of the outcomes desired by thecustomers. The core insight of this chapter is based around the concept thatcustomers value what you can see and touch. If you realign your firm?capabilities so that you can offer more of the things that are visible to thecustomers, you will be able to differentiate your offerings from that of thecompetition. On the other hand, the components of your capabilities that areinvisible to the customer can be reengineered for greater efficiency that addsto your profit margins. Variations of these concepts are developed in greaterdetail in chapter five and illustrated with numerous examples. This frameworkis a very low risk way of modifying capabilities to put distance between a firmand its competition.
Thischapter concludes with a section on two other sources of risks. These risks cancome in two guises -- errors in assumptions and errors in logic. In anybusiness opportunity you have to make certain assumptions about the future. Theassumptions where most firms will be surprised (negatively and positively) willbe with regards to customer preferences and market demand because no one canpredict the future with one hundred percent accuracy. However, this is a riskyou must get used to taking otherwise you will be constantly gun shy to take onany new opportunities. On the other hand, when it comes to assumptions aboutthe capabilities needed to deliver the core objectives of the strategy, a firmhas to strive for much more accuracy. Often mistakes in assumptions regardingcapabilities reflect a lack of clarity and should be easy to correct with thetechniques developed in this book.
Thenext source of errors comes from poor logic. You will have to apply logic todetermine which core objectives you will focus on and which set of capabilitiesyou will draw on to deliver the objectives depending on your risk preference.Unfortunately, even the best companies succumb to logical errors. For example,Dell computer now admits that its move into retail channels was a logical erroras its direct mail capabilities did not match the capabilities needed to dealwith retail channels. This chapter will go on to suggest why Dell might bemaking a similar error at present. And one reason why even successful companiesmake logical mistakes is hubris ?an exaggerated belief in what a company cando. In fact, success itself can lead to overconfidence that in turn might leadto a lack of discipline in applying the framework before committing to aventure. This last section of this chapter develops some ideas about how toavoid assumptions and logical errors.
Chapter Six
Creating an organization to benefit from theoutcome to objectives framework
Onereason why precisely defined core objectives can reduce the risks of failure isbecause everyone in the organization has clarity regarding what he or she needsto do to make the organization move towards its competitive goals. However,before there is a convergence around a set of core objectives by the rank andfile, the wording of the objectives has to be tested to see that those who willimplement the strategies can relate to the objectives. In this chapter, we willillustrate this step with many examples to demonstrate how successful companieshave gone about this process. If an organization disciplines itself intodefining its core objectives clearly it will find that its batting average willgo up significantly. Even when a firm makes mistakes it will be able to learnfrom its mistakes better.
Section2
Understandingthe Risks in Growth and Diversification Strategies
Inthe first section of the book you will have learned how to develop a low riskstrategy for a specific business. This section develops frameworks forunderstanding the risks in growing the core business or entering markets thatare new to a firm. In Chapters 7 and 8 the book develops frameworks tounderstand the risks of entering an existing market or adapting to a market. InChapter 9, the book considers the risks in creating a new market or shaping amarket. In Chapter 10 we take a dynamic look at how the risks in a strategyevolve over time and how this can be managed by multiple migration paths.
Chapter Seven
When and how to use differentiationentry-strategy
Thebasic risks in adapting to a market are the same as an existing business. Youneed clarity in how you want to compete (core objectives) in the new businessand the capabilities that you need to deliver the objectives with the leastrisk. However, there is a critical difference when you are entering an existingbusiness. You have to overcome entry barriers. In Chapter seven the bookdevelops frameworks to overcome the entry barriers without taking on unduerisks. Basically, as a new entrant a firm needs to attack parts of the value chainwhere the incumbents are likely to be vulnerable and/or a firm can leverage itsexisting capabilities. This chapter provides some ideas about how to carry thisout with minimal risks. This chapter also presents the argument that early inthe product life cycle of a market or in market characterized by a few players,the low-risk entry objectives for most entrants should be differentiation andin the mature stage of the life-cycle the low-risk entry objectives should below-price. This is true irrespective of the generic description of the marketthat you are entering. For example, Lexus entered the luxury segment of the carmarket in 1989 with a low-price strategy. On the other hand, in the year 2000JetBlue airlines entered the low-price segment of the point-to-point passengerair transport market with a differentiated strategy. There will be entrantsthat may attempt a different entry strategy. However, apart from a fewexceptions such as Xbox taking on PlayStation with a low-price strategy, wesuggest that even for the strongest entrants such an entry strategy mayincrease the risks.
Chapterseven also develops frameworks to understand the capabilities needed to executea differentiated or low-price entry strategy and the risks that the entrant hasto consider ex-ante. Chapter seven explores the differentiation entry strategyin depth and Chapter eight does the same with the low-price entry strategy.
Chapter Eight
When and how to use a low-price entrystrategy
Thebasic risk in a low-price entry strategy is you lack or cannot develop alow-cost capability. In chapter eight we use the example of Dell Computer todemonstrate how a firm can leverage parts of its existing capability set byattacking bloated cost structures of well-established incumbents in matureindustries. However, Dell has not always succeeded in its low-pricediversification strategy and there are some important takeaways here. The twomost important takeaways are the need to have complete clarity in the kinds ofmarkets where a low-price entry strategy, given a firm? unique capabilitysets, is likely to succeed. Deviation from the ideal market profile willincrease the risks of failure. Even for Dell, high-margin markets that we argueare not conducive to a low-price entry strategy, such as storage, have provento be problematical. Second, if a firm absolutely must enter a new segmentwhere it cannot leverage its capabilities it may be able to reduce the risksunder specific situations. We use Dell's entry into the service business as anexample to illustrate these situations.
Thischapter concludes with an analysis of Dell's and Sony's strategies fordominating the consumer electronics market. Based on the frameworks that youwill have learned up to this moment, we encourage you to make a predictionabout which of these two strategies is likely to succeed.
Chapter Nine
Strategies to shape markets: products,process and platform
Chapter 7and 8 develop frameworks to understand the kind of entry strategies that thevast majority of companies will be involved in throughout their lifetime --entry into existing businesses. However, there are a few companies that pursuemuch grander ambitions to shape or create a market from scratch. These types ofstrategies are inherently very risky because by default firms have to acquirenew capabilities to succeed in a market that does not exist. Chapter 9identifies the critical objectives that must be met to give you a chance insucceeding in market shaping and how to reduce the risks in the significant investmentsthat you must make to develop the capabilities to shape markets. This chapterconsiders three broad market shaping strategies and how to manage the risks ineach. These are using a new product, using a new process and using a newplatform. We will not only consider the risks when initiating one of thesestrategies but how to sustain it in the long run if and when competitionbecomes an issue. An example of a product based market shaping strategy is theBlackberry. An example of a process based strategy is a repeatable acquisitionprocess such as Cisco or Banc One or a technology infrastructure that enablesone firm to take risks that others are unable to handle. An example of aplatform is the Microsoft DOS or Windows.
Chapter Ten
Develop multiple migration paths
In thefinal chapter of the book, we develop a framework of avoiding risks in a moredynamic context. You need to get comfortable with embarking on a course ofaction even though you have not managed to clarify all the relevant uncertainties.The good news is that some of these uncertainties become clearer over time.This chapter provides some ideas about how a firm can navigate its way to itscompetitive objective by avoiding risks that it clearly did not anticipate inthe beginning.
The basicconcept developed in this chapter is that you do not need to close off all themultiple options that you have identified while designing a strategy using thetechniques from section one. The really good companies keep as many optionsopen as long as possible and make the decision regarding closing options basedon information that they receive in the future. Even using the frameworksdeveloped in this book, you will never have as much information as you like tohave in order to avoid all the risks in the options that you do decide topursue. However, many times the quality of information can improve over time.If you can keep some options open, you can reevaluate the options at a laterdate as more precise information becomes available in the future. This willfurther reduce the risks of undertaking an option that is beyond yourcapabilities. We call this technique managing the migration paths (to yourultimate goal). This chapter develops frameworks for managing migration pathsfor adapting to a market, shaping a market and for developing platformcapabilities.
Appendix
Case Study
Inthe concluding section of the book we present a case study on Enron. We realizethat most people have a negative impression about Enron and justifiably so.However, there are some things that you can learn even from the likes of Enron,specifically what not to do even if you are successful initially. We argue thatEnron first represents a strategy failure because the company did notunderstand the risks it was taking on and then tried to cover up its mistakesby techniques that are allegedly fraudulent. In the context of this book, Enronhas succumbed to the risks and it may be useful to dig below the headlines tounderstand why and how the concepts developed in this book can be applied tounderstand Enron? strategic failures.
Some concluding thoughts
Wethought long and hard before deciding to write one more book on strategy. Wegenuinely feel that the issue of risk has not been given as much attention asit deserves in the strategy literature. Further, thoughtful strategypractitioners and academics are waking up to this idea of focusing on businessrisks and we see an opportunity to stimulate this discussion. The basic messageof this book is that in order to avoid the risks that others may succumb to,you need to have clarity and choice. You need to clearly understand andcommunicate where the sources of risks are. You need to give yourself morechoices than your competitors in navigating your way around the risks. All theframeworks and heuristics that we develop in this book will help you with thesetwin goals of clarity and choice.
However,we do wonder if by focusing on risk instead of returns we will be perceived astaking a negative perspective on strategy -- how we can avoid loss instead ofhow we can exploit a profit opportunity. If anything, the central thrust of thebook is exactly the reverse. We urge you to look for profitable opportunities.The caveat is that most profitable opportunities are profitable because it istoo risky for most to exploit. The only way to really exploit a profitableopportunity is to retain most of the profits without succumbing to the risksthat keep competition away. Once you understand risks in profitableopportunities, then you can expand your opportunity frontier that can only leadto increased shareholder value in the long run. You can profit by keeping theprofits in risks that others will avoid.
True to thisprinciple we have taken on a risk that most other management books avoid. Mostmanagement books use examples of past successes and failure to justify theirframeworks. Of course, this is necessary and we have also done that to a largeextent. However, we have also gone out on a limb and made predictions about thestrategies of the best companies in the world. Some of these predictions arenot favorable but if we believe in our frameworks the true test will have tocome in their predictive ability and not by looking in the rearview mirror.Imagine if someone had predicted Enron? problems in 1999!
--------------------------------------------------------------------------------
Endnotes
1 Academics maysuggest that there are risks form the five forces identified by Michael Porter.Our argument is the risks are a problem only if a firm does not have theappropriate capability to position it against the forces.
2 Readersfamiliar with manufacturing techniques will no doubt relate to the concept ofFEMA (failure mode effects analysis) that tries to anticipate what can go wrongin implementing an operation. This is obviously harder at the strategic leveland precisely why this force can lead to a competitive advantage because so fewfirms do it.
编辑推荐 Pursue your best business opportunities—without the risk!
Today, many companies have become powerfully averse to taking the risks that are essential to long-term success. Dr. Sayan Chatterjee shows how to identify high-risk, high-return opportunities, and then systematically mitigate those risks up front, as you design your initiative. His techniques can help you safely pursue huge opportunities that others pass up—and sustain profit growth far into the future.
目录 Introduction xiii
Section 1 Designing Strategies for Avoiding Risk 1
Chapter 1 How to See Gold Where Others See Risk: Identify More Choices to Get the Gold 9
Chapter 2 Three Steps to Design a Low-Risk Strategy 27
Chapter 3 Identifying Multiple Capability Configurations 47
Chapter 4 Designing Strategies with Low Capability Risks 65
……
