Tech IT Easy » strategy

Gold-Fishing, an inbound view on M&As in tec-space

Georgia Psyllidou — Sun, 24 Jan 2010 08:01:20 +0000

(attention, long vehicle)

Anand’s article touched an explosive combination of decision+change management+money. It was inspiring indeed, and got me to write down two or three thoughts looking the M&A from inside a house. To write this piece, time popped-up by chance and bad luck in the same time. Nevermind why I found myself out of gas and battery in the beginning of my Friday evening, I really enjoyed my decision to go back to cocooning.

The decision

This is the thing about deciding to do an M&A or change, it’s not wise to be 100% sure about the best direction. (Ok, don’t skip the due diligence). A choice might be considered as good by more people and for a longer time, but if you search too long your competitor will do your A and no M for you. So you have to make it early. For normal people with no 6th sense, this means they have to deal with the effects of their choice both personally and in their team .

Why you take the decision? Probably for financial value creation, technical synergies, or to phase out potential competitors.

How you take it? Depends on the decision model of your company : single minded, organizational, political, garbage can. (insights from Strategor, 4th edition, Dunond 2005)

Once the change is there, I’ve observed two styles of dealing with it and getting others to deal with it.

The behaviors

One is that you explode and overwhelm everybody with excitement yourself included, partying hard on change. People are normally happy before they realize what has hit them. The happy tail is guaranteed to last, varies on the party. Life stats say that happiness from a good home party last about 3 days, from a football final for about a month, from Olympic games about a year.

Another approach is that you go Zen, as if nothing has happened, act naturally etc. This works if with adult-ish organizations because routines are very important for adults, etc.

In both cases you surf slower, either because you focus on partying or because you surf tai-chi style.

To keep surfing fast, Brazilians have thought of Kapoeira (training masked in partying).

Ok, this is people, what about the business?

The money factor

Change+money is a bit more tricky, because it involves more tension and more aggressive effects. Culture of money asks for more traditionalism, thoughtfulness, respect.

Mutual respect :) and money-related expectations makes M&As such showstoppers for internal rhythms and decision making (the case of M&A driven by financial value creation). In my view, if the motivation is pure value creation the results risk being lost in translation. And M&A is a showstopper.

other motivations

If it is value+product synergies, the organizations quickly recover and from change and get productive on the common focus. In that case, the initial slow-down, frames significantly the savoir-faire and prevents chaos. The focus is scaling on innovation and this can happen within a few months. And M&A is an investment on strategy.

Let’s not forget that innovative products carry this identity either because they target niches or if not, they are innovative for a specific period of time, on their way to bannalization. So when the Big Fish frames how you scale on innovation, the Small Fish start changing skin. Shouldn’t it? It is very difficult to see in retrospection, what part of product or service the Small Fish has fit in since identity integration is necessary.

Last, if motivation is gulping competition early the M&A is a showstopper by design.

the project

Beyond initial motivation for the M&A , the time to market and style to market of an M&A-ed innovative stg is very much bound to internal Big Fish culture but also to many external factors such as market dynamics.

My basket of examples include,

Mobile payment : has travelled from developing countries to the developed ones like a financial and regulatory Benjamin Button. (TTM : ~7y, STM: sponsored by heavy banking industry to open-up consumers)
Peer-to-peer communications : have travelled from early experimental internet to the gray napsteric zones, masked in skypish applications to land through Big Fish in the B2B space as a feature of datacenter operating systems / “branch cache” how it is called in MSFT (TTM : ~15y, STM: integration into the mosaic, identity change)
Video semantics tracking : has travelled from academia to consumers in speed-light (less than a decade to launch project Natal) (TTM : ~10y, STM: innovation transforms the product)
Biscuit-flavored yoghurt : Marketing innovation, where you test a few recipes and you build on on insghts that people love biscuits but are too guilty to consume them at the rhythm of yoghurts. Also have to buy the rights of a favorite biscuit brand. (TTM : ~6m, STM: act naturally )
With this last one I want to emphasize that if software was simpler to build, simpler to adopt, and was sold in cheaper units, end users could possibly profit from and indulge in innovation faster and more naturally. This is why social-technology + M&As are a better match.

Hey I am not pocket-Gartner, so please feel free to challenge my examples.

After aaaall this analysis, I come up with a…question: We’re pretty much involved in producing innovation so it’s normal that we’re pretty demanding on change happening fast. However, how fast can an average consumer or ITpro absorb and adopt software innovation?

In virtualization for example, a lot of which passed through M&As, MSFT carries the burden of late TTM. By the time MSFT was into virtualization, it was no longer innovative. But still adoption rates by the market were loooooow and (relatively) sloooow moving. So buzz-wise TTM was late, but adoption-wise TTM was early. Crazy? just a paradox of software and friends. The attained benefit for MSFT was catching up with the buzz rhythm and also syncing with the adoption rhythm. Isn’t this a successful strategy?

Conclusion?

Overall, even though M&As slow down and phase out a lot of good stuff, technology is still a great industry for M&As because

A lot more of fresh attitudes survive in tec- fresh towards life and change as well.
The money culture is less pronounced
Creativity and innovation need change even in dinosaur size and style.

“Don’t feed the lions!” – please do….

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Enterprise 2.0 : fostering knowledge management, innovation and productivity

ceciiil — Sun, 18 Oct 2009 17:22:39 +0000

Hi ! it’s Cecil here.

Just uploaded this Enterprise-2.0 presentation. Title : Enterprise 2.0 : leveraging collaboration platforms to foster knowledge, innovation and productivity.

Best to see full screen

Enterprise 2.0 : Leveraging collaboration platforms to foster knowledge, innovation and productivity

View more presentations from ceciiil.

Target audience is upper management.

The objective is to address key issues faced by organizations built around knowledge : management of not only knowledge but also innovation and productivity. First to see the current limitations with the tools and processes in place and then to see how collaborative platform and enterprise 2.0 approach can offer competitive advantages to the company.

I have not been really convinced by the material available on the topic. Mostly too buzzwordy and flashy, this often scares upper management out. Most of them then subsequently relate E2.0 to consultant-dollarmaking-vaporware material, hence the dedicated section in the presentation.

Besides, in my view, these presentations usually go from the existing social applications (and their many exciting features) into the enterprise. In order to convince management, they should rather go the other way round : from enterprise real problems to how they can be addressed by social software platforms.

Mostly influenced by this excellent presentation by Mr Enteprise 2.0 : Andrew McAfee at PARC (link). Also by many of the videos, books, articles, blog posts refererred to in TechItEasy and Heavy Mental.

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The truth about headquarter locations

Vincent van Wylick — Tue, 18 Nov 2008 12:55:50 +0000

One of the first thesis topics that was proposed to me, as part of my strategic management master, was to research why companies are located where they are. Turned out that this is some super-secret thing and there hardly is any data on it. Our assumption was that this must hence be strategically significant.

I abandoned the project, after making this super-complex mindmap about it. I decided, I just wasn’t interested enough in the topic and that the reason was probably a very boring thing, like taxes.

(click on pic to see full pdf in Scribd)

Yesterday, I had a pretty cool meeting with a software-company that has been running successfully for about 10 years. Only it was in the middle of nowhere, close to some Dutch village that you will never have heard of. After the meeting, I asked why on earth they had located there (no thesis-related motive at all)!? Turns out that when you start a company and start hiring locally, your loyal employees won’t be so loyal anymore if you decide to move to e.g. Amsterdam (about 2 hours away).

Sometimes the simplest answer can be hidden under a lot of complexity…

Vincent

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Microsoft blocks ads. what?

Georgia Psyllidou — Fri, 29 Aug 2008 08:57:44 +0000

Hey there, planet mainstream here, are you in for some blockbuster scenarios?

After 2 peaceful years of gardening new products and shopping (still checking if Yahoo comes in the right size) Microsoft has apparently decided to go extrovert and check out the competition. The new internet explorer, IE8, marketed as the “discrete one’ comes with features like ‘In Private Browsing’ that help you block away some aspects of commercial intrusion such as cookies, history lists, and ads.

Wait a minute, are ads angels or demons? It depends on whose side you are, ads are actually multifaceted like mood rings: their use and value are subject to the judge’s role, critical spirit, need of information.

Web ads are mostly seen as angels: they do no evil, they function more elegantly than on other media, probably that’s why people put up with them and other people have based business and state funding models on them.

Demonizing web ads is not part of the ‘InPrivate Blocking’ goals, free will rules. But with privacy on internet becoming a hot topic for regulation, InPrivateBrowsing is actually a do-no-evil, democratic timebomb.

[youtube=http://www.youtube.com/watch?v=4fMqJWoOjE4]

So, this is my scenario.

(late this summer, honey I’m home)

Microsoft is risking committing twice the same antitrust crime, expecting the ad-allergy to spread like a demon-ex-machina by means of ambient buzz (autumn leaves and dust).

(later this year, in the city)

In the same way we’ve rapidly become eco-aware, we begin paying more attention to our privacy.

(you’re just too good to be true)

As Google’s adwords becomes better and Google’s search engine becomes more personalized the results of these two tend to look alike. At some point, our contextual aesthetics react to the lack of difference in the typology of service. Allergy. (atsum)

(in the meantime, the trial)

Then, the second antitrust trial for Microsoft magnetizes ambient dynamics towards privacy awareness.

(whose side are we?)

People are mostly concerned with the direct impact of this issue on their lives rather than the health of the economic competition. This aspect works for Microsoft.

(in the spring, jingle bells blossom/ after the trial…)

As time goes by, behavioral reflexes are built on this awareness.

By highlighting that do-no-evil doesn’t equal do-good, the trial triggers the attitude of systematically using the ad-blocking features in IE or elsewhere (Firefox, Safari…)

(is the trial just a bad dream?)

Google on the other side is still our clean cut hero, our Brandon Walsh.. Fighting for free airwaves, for openness, for us, has chosen an original model of B2C partnership. Beyond a company it acts as a web NGO.

So what is the best path to protect its core business? The legal, the educational, the crowdsourcing or the self-transformational?

Will Brandon

a) complain to the highschool director ?

b) organize an ad-contest for the beach-club kids to campaign for homeless veterans ?

c) run for highschool president ?

d) or study hard to access UCLA?

…to be continued

Well, I also have some legal questions:

If InPrivateBlocking is banned, is the same feature declared non grata for other browsers as well ? What about other add-on programs-is size(impact) shaping legality?

How is the applicable legal domain chosen? Is it an issue of commercial or civil law and how is EU regulation restrictive in each case?

Piss o’ cake?

Georgia

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