Wednesday, July 26, 2006


We all write stories of our lives because we are all fond of story – telling. Each of us has three stories to tell. The first one is when we were young. We wrote our life stories, stories of what we wanted to be, of how our lives are going to be, of what the world would look like by then. It is a story filled with dreams and hopes. It is a story full of idealism and immortality. It may sound like a fantasy and could be dismissed as such but that was our road map of life, one that is steadfastly held. The last story we all write is when we are already past our prime and near our time. By then, we will write our stories. Stories of what we had done, of how it all happened, of how the world looked like back then. Probably, those stories would be full of regrets and bittersweet memories or of triumphs, and challenges that had been overcome. It would most likely be a story full of lessons and sighs about unfinished businesses and dreams. It may sound like an assessment or perhaps a complaint of life thus far and in fact, it is so but it is still the life we by then have gone through nevertheless. The second story we all write is when we are at our prime. We write the stories of our life, stories of what challenges we are facing, of how to shape our lives amidst all that is going on, of the world we are now living. This is a story full of adventure and of challenges and trials. This is a story of how we turn our dreams into reality and of turning realities into memories. It is a story of excitement and of fear, of taking risk and of dreading uncertainty. It may sound like an action adventure story, or perhaps a drama, or even a suspense and is could actually be for unlike the two other stories, this story of our prime is not yet written and it wouldn’t be written in ink but in blood and sweat.
Today, I turn 32 and I’m now in the midst of writing the story of my prime. Hopefully, I could fill many a page in this story of mine. There would be plenty of victories and parties to write about but also probably some frustrations along the way as well and perhaps a few events that could be portent of future regrets. I wish I only had a few of the latter (frustrations and regrets) and more of the former (victories and triumphs) to write but I cannot really tell. But, the one thing I could tell and that is, I’m not going to write this story of mine blindly for I had the story written during my youth to copy from and probably a future bestseller to be written in my old age to worry about.

Tuesday, July 25, 2006

A Happy Birthday

by Ted Kooser
This evening, I sat by an open window
and read till the light was gone and the book
was no more than a part of the darkness.
I could easily switch on a lamp,
but I wanted to ride this day down into night,
to sit alone and smooth the unreadable page
with the pale gray ghost of my hand.

Monday, July 24, 2006


By Robert Frost

Whose woods these are I think I know.
His house is in the village though;
He will not see me stopping here
To watch his woods fill up with snow.

My little horse must think it queer
To stop without a farmhouse near
Between the woods and frozen lake
The darkest evening of the year.

He gives his harness bells a shake
To ask if there is some mistake.
The only other sound’s the sweep
Of easy wind and downy flake.

The woods are lovely, dark and deep,
But I have promises to keep,
And miles to go before I sleep,
And miles to go before I sleep.

Saturday, July 22, 2006


This is the message that greets me every morning when I turned on my cell phone. I wrote this quote of mine a few years ago ostensibly as a reminder to myself. I want to remind myself that life doesn’t slows down or waits for me in spite of every excuse however valid or silly. I could waste my life in a merry spiral of indulgences and play and turn up one day to find out that my time is nearly up. By then, I would have most likely regretted to have done nothing worthwhile and wasted a lifetime of opportunities. Then, I would most likely say to myself, I could have invested in a more useful enterprise given a second chance. There is however, no second chance. This is not a computer game wherein one has 3 lives to spare and could reset every time one fails. We only had one shot at this and what’s gone is gone, no use crying over spilled milk. However, in the same breathe, this simple quote of mine also serves to remind me that there is more to life than the single – minded pursuit of the definition of one’s short existence. Life is not all about purpose or mission. Life is about enjoying the time given to us, of enjoying one’s stay in this transient time and space. Life is like an exotic cruise down a mystical river. It is the sight along the way that makes the trip worth taking and not what’s at the end. Be it so, at times, I find my quote funny. For how could a simple one liner have two contradictory interpretations? Perhaps, it is because life is not a race or a leisurely walk to the finish line. It is in fact both. There are times when we had to make haste to reach our goal before the sun sets for time is against us but then again, there are times when we had to make a detour from our journey especially when we chance upon an open field with its luscious green grass, the warm sunshine, the cool breeze, the beautiful birds’ chirpings, and the inviting shades under the tree. It is “forgivable” to postpone the chase for another day or two perhaps and take a rest and cherish the moment.

Thursday, July 20, 2006


I’ve been reading this book by Henry Mintzberg. It is called, Strategy Safari, A Guided Tour Through The Wilds of Strategic Management. The book is all about how strategies are created within the firm. It lists 10 schools of Strategic Management and how each school crafted strategy. Not only that, the book also define the role of the CEO in each school in relation to the strategy formation process. According to Mintzberg, strategies are crafted either by deliberate action, i.e., through analysis and planning process, by the learning process i.e., understanding that strategies “emerges” as a trend and later adopted, or by maintaining consistency, i.e., strategies as a constant pattern of action or by combining the three. Each of the schools emphasizes one “process” of strategy making over the other with certain modifications for schools with almost similar ideas. The 10 schools according to Mintzberg are:
1. The Design School
2. The Planning School
3. The Positioning School
4. The Entrepreneurial School
5. The Cognitive School
6. The Learning School
7. The Power School
8. The Cultural School
9. The Environmental School
10. The Configuration School
The differentiation of the field of Strategic Management thinking into 10 schools is actually a fine one and probably debatable but Mintzberg made distinction quite clearly. Of the 10 schools, the first 4 emphasize more on deliberate strategies while the remaining schools focuses more on the emergent strategies with varying emphasis on strategies as patterns. The last school though makes use of the 3 types of planning process.
The Design School believes that the strategy formation is a process of conception. Strategies developed here are deliberate through careful analysis of the environment and the opportunity it presents and the threats it posed while at the same understanding the strength and weaknesses of the company in face of such environment. In this school, the task of “conceiving” strategy lies squarely on the CEO, be he the head of a small company or a large organization with global presence. The CEO is the master strategist and it’s chief executor, period. In order for that to happen, the CEO should be an exceptional genius in order to craft such a grand strategy based primarily on their intuitive analysis. This is because of the breadth, size, complexity, and scope of the organization where the strategy would be applied.
The Planning School views strategy making as a formal process. Like the first school, strategies are deliberate and are the outcome of analysis and planning. The difference however is that the Planning School believes that strategy formation should go through a step-by-step procedure of deliberation and analysis. In here, analysis is no longer limited but is pretty much overblown, in – depth, and concise. Because of the requirement of an in depth analysis, CEOs can’t simply do the job, instead a host of analyst does the job for him. In fact, an entire department was created to do precisely that and this unit is usually the Corporate Planning department of a company. Here, the CEO is no longer the “genius” for he is no longer the chief strategist; the Corporate Planner Head now takes that role. The CEO as the title implies (Chief Executive Officer) executes the strategy formulated by the CORPLAN group ensuring that strategies gets implemented as intended. In this school, action is differentiated from thinking while in the Design School, action and thinking is united as one.
The Positioning School on the other hand viewed strategy making as an analytical process. Here, there is no CORPLAN group, instead there is a staff of experts who readily analyzes the impact of environment changes on the company and advises the CEO. The CEO here decides on it en route to crafting a strategy. This school believes that there are only a finite number of viable strategies on the table for the CEO to choose from. In order words, given a set of conditions, only a handful of strategic choices known as positions are available to choose from and most importantly, these positions are generally known to all the industry participants. So much so that companies within the same industries having more or less the same orientation and capabilities adopts the same position. The CEO’s role here although a thinking one is reduce to merely choosing a viable and defensible “position” and not crafting a creatively new strategy. Once a position is chosen, the CEO must pursue it, hence, strategy here though initially deliberate (planned) becomes a pattern over time since “positions” takes time to build.
The Entrepreneurial School of Strategic Management believes that strategy creation as a visionary process. Here, the CEO is both the strategist and the executor but unlike in the Design School wherein the CEO is the master strategist. The Entrepreneur/Visionary is the master. In the words of one CEO, he is the dictator, the king, the emperor, or god whatever you may want to call him because he alone holds the vision and only his interpretation of that vision is legitimate/correct. The CEO of the Design School tries to find a fit between environment and company but for a Visionary, the company/organization is for him to craft and mold to fit his liking. It is in this latter fact that the role of the CEO in this school is one of opportunity seeking. Strategy here though deliberate becomes a pattern for the most part. In fact, strategy as a term is no longer relevant. The more appropriate term more often used here is the business model.
The Cognitive School holds that strategy formation is a mental process, i.e., it exists in the mind of the CEO colored with his own biases and his own interpretations. The CEO’s main role here is a thinker and his approach to strategy hinges less on trying to “cope” with the environment using the company’s capability rather it relies more on “how” the company should be coping. In short, the CEO is more interested in the “paradigm” of the company. An example would be the concept of customer. In the old paradigm, customers are institutions or people that buys the company’s end products. In the new paradigm, customers are not outside the organization but could be anyone down below the supply chain, i.e., the concept of internal customers.
The Learning School of Strategic Management considers strategy making as an emergent process. Strategy formation here follows the dictum “learning as we go”. CEOs of this school believes that strategy is a complex undertaking and that people at the center abrogating all the decision making powers are insulated from the outside environment and hence, couldn’t possibly appreciate the intricacies of the “outside world” much like the frontline people. Hence, CEOs of this school favors decentralization and are obsessed with creating a “learning” organization, i.e., an organization that learns as it goes and react automatically without the CEOs intervention, which may come too late. The CEOs role in school functions not as a strategy maker but as a “controller” and ‘overseer” of the entire strategy making process, i.e., others makes the strategy, the CEO just ensures that the strategies are in the right path. However, the CEO of this school varies in the “looseness” of control exerted over strategy making. Some CEOs prefer to put up an umbrella strategy, imposing constraints and limits, communicating rather clearly their preferences but leaves the content and execution of the strategy to the “frontline”. Other CEOs prefer to control the processing side of strategy by providing support services like HR, Finance, etc in order to make the strategy work. The frontline unit handles the content of strategy as well as the execution but the resources required for implementation comes from the center. Still, another variation would be to form a consensus strategy wherein each autonomous unit plan and direct their own strategy and the CEO’s role here is to prevent friction and conflict among the various units with overlapping interest by “balancing” each other through consensus. Picture that of a newspaper publishing with many egoistic reporters vying for the same story but with different angle.
The Power School views the entire strategy making process as a process of negotiation. The CEO in this school is the ultimate deal maker for he has to consider the demands of the various stakeholders, which includes among others employees, shareholder, government regulator, community, customers, interest/pressure group, etc. Each stakeholder has a legitimate claim on the company and their demand is many and varied. The CEO doesn’t try to satisfy all the demands of the all stakeholders for that is impossible neither does he tries to maximize the satisfaction of a particular stakeholder for that would be difficult and risky if not unwise. Instead, the CEO “satisfice” the various stakeholders by meeting their minimum demands. Hence, the CEO negotiates. Strategy here is crafted not only based on the exigencies of the market but also on the imperatives of the deal (and therefore, it is largely emergent). In the end, after this entire balancing act, the CEO must be able to enhance his power, prestige, and influence. In this case, a Power School CEO should be a superb politician.
The Cultural School is different from the Power School in that this school believes that strategy formation is a process of social interaction based upon the shared beliefs and understanding of the members of the organization. Here, strategy is collectively developed and the CEOs role is that of a team leader. He not only defends the company values vigorously but also epitomizes the company spirit. However, once the organization is faced with a crisis that threatens its survival, the CEO also plays the role of “rule breaker”, one that tries to recast the mold of the company hopefully for the better.
The Environmental School holds that strategy formation is a reactive process, one in which the environment plays a very active role. The CEO merely reacts to the environmental forces, i.e., he doesn’t have the initiative. His role is that of a contingency planner or a crisis manager, not a strategist in full control of the situation. In fact, I surmised, strategy doesn’t exist at this school, instead, a set of logical common sense rules are in place, heuristic rules. Heuristic rules are those kind of rules that contains a pre - condition and an established response as in “If this happens, we should do this” rules.
The last school of thought in Strategic Management is the Configuration School. This school believes that strategy formation is a process of transformation. It view strategy as changing through the entire life cycle of the organization. During start – up, strategy tends to reflect the entrepreneurial school of thinking; while growing, strategy formation tends to mimic a learning process; on maturity, strategy tends to follow the planning school of formalize planning process; and in it’s decline, strategy reflects that of environmental school of reactive process. The role of CEO also changes along the life cycle path of the company. In short, each situation dictates a different kind of leadership approach. Hence, the CEO’s role is situational.
As I said, the differentiation of the various school of though is a fine one and one that probably exist in the mind of an academician for in real life experience, a CEO would probably play all the roles of the different school of thought. He could be a visionary and also a master deal maker. He could be a team player but also a mere executor relying on a think tank rather than a thinker. However, the difference for each CEOs and CEOs do differ from one another is in their emphasis of what role they assume. In fact, one could gather much by simply understanding how do CEOs “see” themselves. A CEO maybe both a visionary and a deal maker but he is more of a deal maker if he sees himself in such light. Hence, I believe that any deserving CEO should be able to grasp their conception of their role in the organization and understand how the grand strategy flows from such self – conceptualization in order to improve their leadership capability and that of their organization’s performance as well.

Tuesday, July 18, 2006


What is leadership? This is a question that has boggled me since the day I finished my academic works in MBA. It has also recently become a topic that occupies my thoughts for sometime now. My professor, Professor Elfren Cruz was the main culprit in both instances. It all started 5 years ago when I asked my professor during a break in the lecture on an article I read in the paper concerning competitive advantage of firms. Specifically, my question is about people and why some strategy makers believed that they are the source of a company’s advantage and not in its assets or in its resources. My professor’s answer was that a firm’s capability is performed by it’s people using the assets and resources available to them. Without people, the assets and the resources amount to nothing. The answer was simple as that but back then, with my relatively simplistic view about business, I was simply awed by the realization. So much so that I blurted out that “Why isn’t it being emphasized that way in MBA, I mean why we are being taught with analysis and techniques and everything else and not the big picture?” And to that, he gave me a curt reply, “because most of the professors are not aware of that since none of them are CEOs. Many of them had only a very limited view of the business.” Inadvertently, he also mentioned that I’m not (yet) a CEO either. I was profoundly shocked by his frank comment. For all my life up to then, I was being groomed to handle the family business and to realize that I’m not ready to be a CEO and therefore unworthy to carry the task was something I couldn’t simply accept. If I had to run the business someday, I had to change. I had to be better. That night, I resolved to change my ways and to train myself to become a CEO by acting and most importantly, by thinking like a CEO. And to achieve my goal, I figured that I had to develop a strategic mindset. To see things in a big picture and to break it down to it’s individual constituents and analyze each of these pieces and from there develop a strategy to exploit opportunities, to counter, and to neutralize the threats. By the time I’m through with STRAMA, I was able to establish that kind of thinking even though it was kind of raw. However, I felt something lacking in my training to become a CEO and that is leadership. At that time, I thought that I could come up with the most incisive analysis and craft the most brilliant strategy but if I cannot make it work or make it happen or convince people that my strategies are correct, things wouldn’t change and that I’m no better than just a simple analyst. Analytical skills and technique plus a strategic mindset don’t a CEO make. In the end, it’s how you make it happen. No wonder, MBAs make good business administrators but not entrepreneurs. I wonder then why business school doesn’t teach such an important aspect of management. Probably, it is because leadership is something personal or personality based and that it is impossible to teach a person a standard set of “knowledge”. Leadership, I surmised couldn’t be taught with words but only with hands – on experience. And so, I experimented, taught myself, and developed my own style and know – how on leadership. You could say that the past 5 years or so was a sort of training for me. I thought that I was on a right path until recently. About 2 months ago, I had lunch with my professor and he was talking about the recent trend in Strategic Management based from his readings on Harvard Business Review. He mentioned that the trend seemed to shift towards emphasizing leadership. I was curios with what he said and actually questioned that trend. For how could that happen? I mean, Strategic Management is all about frameworks, and analysis while leadership is personality based. The former could be taught while the latter could only be trained. To suggest that strategy is tied up with the personality would transform the study of strategy making and management into more of an art rather than a strict science, which goes against the grain of strategic management. My professor feeling amused with my shortsighted understanding asked my evaluation on some historical personage and their leadership. Specifically, he asked me what do I think about Hitler’s leadership? What about Hu Jin Tao’s (the current Chinese leader)? Or for that matter, Mao? I was dumbfounded by his questions. Leaders from what I remembered in textbooks are people who directs and guides an organization towards it’s goals and are able to command the cooperation of a majority of it’s constituents in working towards that goal either through force i.e., executive fiat or coercion or through consensus or through motivations i.e., reward and punishment. By this definition, Hitler, Mao, and one could even throw in Stalin (Soviet dictator) would turn out to be good leaders for they were able to garner the support of a majority to work towards the established goals in spite of their ultimate failure. The failure of their ventures shouldn’t denigrate their leadership. For can we blame leaders who did their best but ultimately fail? (By the way, this is no exoneration of their culpability or their immoral acts). However, to say that the end result of their leadership is immaterial is to turn a blind eye to the sufferings of the multitude within the organization i.e., people eventually suffered from their failure. The case in point, Germany defeated in WWII was divided into two and was in shambles while China suffered decades of stagnancy as a result of the failed Great Leap Forward and the destructive Cultural Revolution. Not to mention the multitudes, who died because of it. By this context, their leadership was a failure. If that is the case, then the definition of leadership and of leaders is inadequate (by the way, these are text book definitions). It is not enough that leaders work toward a goal with the support of the many in an organization. They should also succeed. However, some of the variables of success are way beyond the leader’s control i.e., there are things beyond the control of an individual. One can control events but only up to a limited degree. If a leader couldn’t control all the factors of success then wouldn’t it be unfair to them if we use success as a yardstick? Furthermore, is leadership merely about success or achieving goals? Perplexing indeed, couldn’t imagine myself unable to grasp a simple concept like leadership. Over the past weeks, I try to understand the concept that my professor parlayed to me. I thought about it, I read about it, I researched about it but I was nowhere close until recently. In most books I read or in researches I made on leadership, various author tried to “portray” leadership. They didn’t define it per se but describe it. They describe leadership either by example (of famous personage) or through type (authoritarian, charismatic), or through style (paternal, participatory). In fact, most authors are biased towards charismatic, participatory type of leadership. As if to further enlighten us on what leadership is all about, authors emphasize about the difference between a manager and a leader. To simply put, a manager is told what to do and does it while a leader decides what to do and does it, i.e., leaders possesses the overall strategic initiative. In spite of all of this, I don’t seem to get anywhere near the mark of what he is talking about. What does initiative, style; type etc has to do with ultimate success and achieving goals? One could be open and participative as well as charismatic but still aimless and incompetent. I tried thinking about in terms of ethico – moral perspective considering the example of Hitler and Mao. Is ethico – moral perspective an important aspect of leadership? Yes, indeed! If so, by what ethico – moral framework a leader should subscribe to? Should it be Christian? Buddhist? Islamic? Or even philosophical? What is considered morally and ethically correct or even permissible in one framework may not be the case in the other framework. Aside from that, what if the ethico – moral perspective of leadership clashes with the expressed mission or goals of the organization, which are to be sacrificed? Furthermore, is ethico – moral framework the only one to consider? Is it in fact, operating independently from let say, tradition? Ultimately, ethico – moral framework is but a strand of culture, or more aptly, organizational culture. It is in this realization that I finally understood what my professor is saying for he hinted it as much when I asked him that is leadership related to culture and to which, he answered that I was thinking in the right direction. You see, I was thinking leadership in terms of personality while my professor was thinking all together in another plane. He is thinking leadership as a strategic concept. Why is it some organization (not just business firms but could include polities as well) stand out among the rest while others are barely noticed? Why is it some organization are able to consistently deliver the goods while others find it difficult to do so? Why is it some organizations are able to sustain their performance and achieve their goals year in, year out while others are erratic in their performance? Why is it some organization are able to constantly outperform their peers and went beyond everybody’s expectation while others are simply engrossed in surviving? Why is it some organization are able to continuously grow while others stagnate? Why some organizations are able to survive for so long, outlive their competitors while others come and go like the wind? The answer is leadership. Leadership I am referring here is not about the traits and personality. It is not about a leader rather it refers to leaders, generations of leaders who pursued the same goal in the same way as the founder(s) of the organization with the same intensity, the same dedication, and the same passion. It is in the consistency of each generation of leaders and not in their IQ’s or in their business education that enables organization to thrive. And this has to do with the organizational culture that bred those generations of leaders. Admittedly, organizational culture plays an important role in shaping an effective leadership. During succession, organization as a whole “chooses” (whether such rights are exercised by the many or a select section within the organization is immaterial) the next leader based on their cultural biases for each organization has it’s own view what an ideal leader should be. Candidates for leadership that aren’t in the mold of an ideal leader are waylaid by the selection process. This is to ensure the consistent quality of leadership. As an added insurance to the consistency of leadership quality, culture also trains leaders within the different levels of the organization as well as future leaders by conditioning candidates to accept certain behavior seen ideal for leadership position. Furthermore, it is also this cultural view of leadership that dictates the behavior of leaders. For leaders should act within a certain premise of acceptable behavior (example: ethico – moral framework) in order for them to become effective and thus garner support for their endeavors. Hence, this would tend to discourage leaders from being “disruptive” as in pursuing other interest inimical to the organization’s interest as a whole and therefore preserve leadership quality and consistency over generations. Though culture has a definitive control on leadership, leaders also exert a huge influence on both the organization and it’s culture. A leader’s flair, style, preferences, and even their biases tend to modify an organization’s culture and even more so during crisis situation. During crisis, when the confluence of outside pressures tends to conspire to push an organization to the brink of extinction, organization tends to be awakened to the need of change realizing the “old” ways don’t work anymore and that a new solution should be made to bring the organization out of the rut. In such situations, the organizations more often ejects the current leaders and in it’s place supplant with non – traditional leaders, hoping that they would bring in fresh ideas on how to run the organization (you can say it is part of their fail – safe mechanism). However, in most times, such actions aren’t enough. Leadership changes aren’t real change but a direction towards it. Real change comes from the changes made in how things are done in the organization that could better cope with the new environment. This means that organization collectively has to give up or more appropriately sacrifice some of their most prized and cherished rights as well as some of their behaviors, values. However, most of the time, organization resist change for it wouldn’t sacrifice cherished values and expected benefits for an unknown outcome. But, more often than not, crisis leaders are able to extract such sacrifices from a desperate organization through the manipulation of expectations by the conscious and selective awarding of rewards and punishments. Viewed in such light, one could say that the case of Hitler and Mao, the Cultural Revolution were such a response (again, this is no exoneration of their guilt). It is in this fail – safe mechanism of selecting non – traditional leaders (but before an organization could do that, it should be aware what is a traditional leader) to head the organization that ensures the survival of an organization in spite of all odds. Another fail – safe mechanism inherent in any organization is the existence of alternate leadership. Leadership exist the moment an organization is born and ceased to function when the organization dies. Leadership is part and parcel of an organization. Leadership however is not the office or the hierarchal structure of an organization. The office provided the holder with legitimate authority to provide direction. Authority makes the exercise of leadership easier however; authority is not substitute for leadership. Once hierarchy fails to deliver the goods, alternate leaders from the hierarchy or informal leaders arose to take charge of the situation. Power struggle would inevitably ensue with one desperate to maintain power while the other keen on legalizing their role as leaders. Again, this is but a way to ensure consistency of leadership quality. Though the system is barbaric but it is nonetheless, effective. Henceforth, in the final analysis, leadership is not simply about direction or initiative towards a set of goals but rather leadership should be about an insurance on the consistency of achieving goals, on the sustainability of above par performance, and most important of all, on the continuing of the organization’s vitality and ensuring it’s survival. The emphasis of leadership should be on creating a dynamic organization with a positive culture of performance and the training of future leaders, ones that share the passion and vision of the founders. Given that understanding, I’m in no way near the mark. It seems that I still have a long road ahead of me to become a real CEO……………

P.S. Tell me if I’m making any sense on this.

Thursday, July 06, 2006


Read my professor’s column last Tuesday (July 4) at Businessworld. Professor Cruz’s latest article is entitled “Managing Innovations”. The article is all about Massachusetts Institute of Technology’s Sloan School of Management’s latest study on innovation penned by Sawhney, Wolcott, and Arroniz and is entitled, “The 12 Different Ways for Companies to Innovate”. The authors defined business innovation as “the creation of substantially new value for the customers and the firm by creatively changing one or more dimensions of the business system”. They go on to list 12 dimensions that are subject to innovation. A few points should be emphasized here. Innovation is not equal to new invention or breakthrough technology. Rather innovation is about in my interpretation of the article, redefining value, i.e., what is valuable to customer or better yet restructuring the value offering into a more superior value for customer. Furthermore, innovations can be made in several dimensions, which include not only the product but also the entire business. In layman’s term, there are many facets or “fronts” in the businesses where innovation could be made to offer customer a much more superior value that they needed. These dimensions are:
1. Offerings,
2. Platform,
3. Solutions,
4. Customer’s (Need and Satisfaction),
5. Customer Experience,
6. Value Capture,
7. Processes,
8. Organization,
9 .Supply Chain,
10. Presence,
11. Networking,
12. Brand.
My professor ended his article here (Of course, he defined each of them). But being a business school graduate, I can’t help but be amazed by the power of this new framework on innovation. Of the 12 dimensions, I felt that I could classify them into 4 broad but interrelated categories (I’m no genius by the way, so if you have other opinions please let me know). These categories are Product and Services (#1 – 3), Customer Relationship (#4 – 6), Process Efficiency (#7 – 9), and Distributions/Marketing (#10 – 12).
Offerings, the first dimension simply refers to the product and service offerings of a company. It is fairly obvious that innovation of this type can happen by simply introducing new product variants or a better improve version of the existing products. An example of the former would be the introduction of new flavors to an existing food product or beverage while for the latter; the higher “speed” of Pentium computers would be a great example.
Platform, the second dimension refers to the base technology from which all subsequent new products are created. The example that came to my mind is the computer CPU chip. Currently, the available processor chip in wide use is the Pentium chip but a new chip is being marketed now, the Xeon chip, which functions like a dual core processor, an entirely different technology from the Pentium.
Solutions refer to the combination of end products and services that a company offers to help solve customers’ needs. An example of an innovation in solutions is event management. Used to be, people or organization had to do it themselves in order to stage an event like call up the catering, reserve a place, set up the props, etc. Now with event management, a single entity would be doing all the legworks and people or organization just call them up. Of course, there are other examples of “solutions” out there and the most popular now is the call center.
Customer, which in my understanding refers to the discovery of untapped customer needs. However, this is not that simple. It is possible that the product or services is already present but the customer is unaware of the features of the product offering due to poor attention given or people aren’t aware of the “creative” features of a product or technology. A classic example of innovation of this type would be text messaging. The technology and the feature are already present then but firms and the market aren’t able to fully exploit its potential but once it did, the outcome is far beyond everybody’s imagination.
Customer Experience refers to the total sensory and emotional stimulation that the customer had while “consuming” the product or services. The advent of fast food is one such example. Before McDonalds came into the picture, food service is not only slow but also inconsistent and expensive in some cases. McDonald’s offer of quick service, cleanliness, and quality revolutionizes the entire food service concept.
Value Capture, according to the article is about generating new revenue stream while offering value product. The example I could think of relating to innovation of this type is SM malls. Everybody knew that SM is in the real estate business of selling/renting out commercial spaces inside a gigantic mall to different retailers and merchants. Their primary source of income is in the rentals. However, lately, one could find billboard ads conspicuously littering the place to take advantage of high volume of traffic. Of course most of the ads are related to the retailers the mall host but that is a new revenue stream for a real estate company. This is an innovation in the sense that not only it offers customer information but in the process, it also generates revenue for the company. Internet web sites are prime examples of this innovation. Most web sites gave content away for free but generate revenue through ads viewed or what the industry termed as “clicks”.
Processes refer to the set of activities related to internal operations. By internal operations, it doesn’t merely meant production processes. It also encompasses other activities like accounting, customer support, etc. The idea of innovation at this stage is to improve efficiency and thus lower cost.
Organization refers to the reporting relationship between units. It also refers to the structure in which “work” is divided, i.e., to roll out a car, several work should be done, production, accounting, sales, etc. and the people - units that handle those work. Innovation of this type would mean to simplify the communication line such that responses could be made not only immediately but also accurately. Decision time would also be trimmed. Furthermore, “work” procedures would be simplified, streamlined, and made efficient as well as cost effective.
Supply Chain refers to the activities relating to the transmission of information on product requirement from the end customer to the primary suppliers and the delivery and transportation of the materials and products from the suppliers to the end customers. Innovation of this type centers on simplifying, reducing the communication link between the end users and the suppliers while at the same time improving the reliability, quality, and the speed of delivery of products from suppliers to end users. The last 3 types of innovation can be categorized as innovation on efficiency. Here, innovation is not merely about introduction of the expensive and latest technology but rather it is all about better control and coordination. There are many tools to identify possible “innovation” on efficiency. Tools like TQM, Reengineering, Six Sigma, Lean Manufacturing System are some of the prime examples.
Presence refers in my view to the visibility of the product or service to the target market. Presence in my understanding has two forms, namely, market presence and presence in the mind. The former deals with distribution while the latter talks about advertisements. Innovation in distribution refers to the use of creative alternative means of distribution like selling through the World Wide Web. Advertising innovations would be using new mediums other than the established ones like tri – media campaign, sponsorships etc. An example I could think of is internet advertising or being advertised/incorporated in a popular movie, e.g., James Bond’s favorite car, BMW.
Network as I understand refers to the “link” that connects the company and it’s products to it’s intended customers. This is not simply referring to distribution. It could also encompass co – marketing arrangements like promotion, partnering, co – branding etc. Innovation of this could also come in the form of “creating” new distribution channel aside from the existing channels. An example would be sports shoes. I remembered when I was young sports shoes are sold in department stores. Nowadays, sports shoes can be seen in sports equipment stores or fashion boutiques catering to a sporty lifestyle crowd.
Brand refers to the imagery conjured by the buyer that conveys the promise of the provider of what to expect from the use of the latter’s product or services. It is a promise made by the supplier to the customer. Innovation on brand in my view pertains to the creative way of positioning the brand either by extending it or rebranding it. An example of the former is the extension of sports shoes brands into sports apparel. As for the second case, an appropriate example would be the creation of the “mass luxury” market and the repositioning of some luxury brands into that category.
From a Strategic Management perspective, the list of dimensions to innovate afforded the strategy maker a focus for them to design their strategy. Using Michael Potter’s 5 forces framework on competition, the competitive forces in the industry conspire limit the maximum prices that a company could profitably charge, in short, a price ceiling while at the same time, these forces tend to establish a price floor (cost pressure) below which the company would experience a loss. The difference between the price ceiling and the price floor is the average profit potential that a company in the industry could reasonably expect given the host of competitive pressure. When the price ceiling collapses and the price floor is forced upward due to cost pressures, companies in the industry would felt literally feel the squeeze in their profitability. Michael Potter proposes 3 generic strategies to neutralize the squeeze. The first is Differentiation that is how to convince buyers that the company’s product is unique and therefore deserving of the price it dictates and not what the competitor dictates. This strategy negates the price pressure by “pushing” the ceiling higher. Of the 12 dimensions to innovate, the strategy maker should focus more on the Customer relationship category. Other categories are important too but the emphasis should be how the customer feels about the product or service, specifically, how it felt different from the other offerings. The second strategy is Low Cost, which is finding ways to lower the “overall” cost of the company, not only production cost but also overheads. This strategy negates the cost pressures and hence lowers if not maintains the price floor. Obviously, the efficiency category of the 12 dimensions is useful for the strategy maker to focus his attention on. The third strategy according to Potter is to focus on a certain segment of the industry (by the way, this is not the niche in marketing terminology). The idea of the strategy is to focus on a segment of the industry where the competitive pressures are the weakest and hence the company would feel “less squeeze” on it’s profitability. The strategy maker in this case should focus more on innovating the distribution and marketing side. For an aspiring entrepreneur, the 12 dimensions of innovation would help them figure out what to offer in a highly competitive market. One of the possible ways for entry available to an entrepreneur is to provide innovative products and services on the table that buyers really dig and makes existing player run for their money. Sawhney et al’s framework can help do just that by focusing the would – be entreprenuer’s mental prowess towards figuring out what to innovate. It is really difficult to come up with a new idea, a new innovation from the existing offerings by the established players that really offers superior value to customers. However it would be easier if one has something to start with.

Sunday, July 02, 2006

Film Critique: ¼ Matrix + ¼ Spiderman + ¼ Lover’s Quarrel + ¼ Nostalgia = Superman Returns


I got to watch “Superman Return” on the opening night, June 28 and boy! The place was jam-packed and queues were long. It seemed that everybody was eager to welcome the Man of Steel back to the big screen. I would say that the movie is quite good. Worth every penny you’d paid for but I am not exactly enthusiastic to see it again for a second time unlike Spiderman or Harry Potter. Not that it is unexciting but rather I had a seen better movie of the same genre like Spiderman. Prior to the movie, I had been watching the “old” Superman movies played by the late Christopher Reeves on TV.

The story of the latest installment of Superman revolves around the “tension” between Superman and Lois Lane with the latter moving on and eventually marrying Perry White’s nephew and she also had a kid, Jason. The diabolical scheme hatched by Luthor could be best describe as only a sub – plot to the main storyline. The plot of the story starts with Superman returning to Earth after a disappearance of 5 years without saying goodbye in order to search for the remains of his home world, Krypton only to discover it as a desolate and lonely place. He returned to Earth only to found out that the world has learned to “live” without him including his love, Lois Lane. In fact, Lois even wrote an editorial entitled, “Why the World doesn’t need Superman”, which won her a Pulitzer. So there you have it, a cynical world and a scorned woman who pretend to have gotten over her love. Throw in the mix is Lex Luthor who manages to serenade an old dying spinster (just assuming) into bequeathing him her entire fortune. He then went to Superman’s lair in the North Pole and steals the crystals and used it to “grow” a whole new Kryptonian continent out in the Atlantic, which would eventually “devour” the entire North American continent. As usual, our hero saved the day but this time, he didn’t manage to get the lady’s hand. Compared to the “old” Superman movies, I would say that the new film has more substance and entirely believable, which is unlike the “old” movies (just seen them recently from the reruns). The old movies are both blatant and idealistic. Superman Returns has a more developed storyline. However, one could find the influence of recent movies like the Matrix and Spiderman to name a few in the film. “Borrowed” from the Matrix are the bullet time actions and graphics and the implicit Christian ideological overlay. The Christian overtone is evident in the movie like when Superman flew Lois to the clouds and asks her if she hears anything. To which, she answered no. Superman then told her that he hears everything and he hears people asking for a savior and with that, he disprove Lois’ thesis that the world doesn’t need a Superman. Or like in the case of the voice of Joe – El, Superman’s father reminding him about the potential of the human race and that he is sending his son to make sure Superman leads them to their potential. Or like the scene wherein Superman in a cross like position fell to Earth after saving the world. All of this tends to emphasize a sublime Christian message. Even so, the movie lacks the philosophical depth of the Matrix. Interestingly, there was a scene where Lois kisses Superman in his hospital bed hoping that he would “wake” up from his coma. This scene reminds me of the scene where Trinity kissed Neo, which not only magically revived Neo inside the Matrix but also transform him into the One. So cliché. As for the influence of Spiderman, it is apparent that the director wanted to project the human side of Superman much like in the movie, Spiderman. The director painstakingly projects that the Man of Steel is not only vulnerable physically to Kryptonite but also to emotional stress. Here, Superman wallows in self – pity, embroiled in jealousy to the point of becoming a stalker, and is genuinely lonely. Although the director succeeded in portraying the “human” Superman but I felt that the connection with the audience isn’t quite “complete”. In Spiderman, the viewers felt intimately connected to Spiderman/Peter Parker but not in Superman. I postulated that it is because in Spiderman, Peter Parker is the main persona and Spiderman is only his sideline or in comic book term, his alter ego. Sam Ramsey (Spiderman’s director) portrays Peter Parker as struggling to juggle being himself and Spiderman. In Superman, the opposite happens. Here, Superman is the main persona and Clark Kent is the alter ego, or to be more accurate, a disguise. The superhuman challenge of being a superhero isn’t present at all, e.g., Clark Kent isn’t pressured to be Superman nor is Superman having difficulties being Clark Kent. He has problems with his love life and that’s it. One of the noticeable “things” in the movie is the director’s adherence to the original Superman, which thus gave the audience a sense of nostalgia and instantly connects with the “old” Superman movies. Scenes like Superman dishing statistics after saving the day. “Statistically speaking, flying is still the safest means of transportation.” Or Lois lane fainting upon seeing Superman the first time. Or Lex Luthor’s comical obsession with real estate and his means of attaining his goal, which instantly reminds you of the first Superman movie. Or the romantic flying date between Superman and Lois Lane. Even the music reminds me of the old Superman. It helps the movie a lot in terms of familiarity. However, what really makes the movie click was the unexpected twist and turn of the plot. It was so unexpected and unsuspecting that one would be totally blown away when it happened. The first twist was the revelation that Superman has a son and he is no other than Lois’ kid, Jason the super kid. Everybody thought that Jason was a human kid born to Lois and her present husband but not between her and Superman. This is because of the myth being established in the previous movies. In Superman 3 wherein Superman went rouge, Superman slept with a woman but she didn’t get pregnant and all throughout the subsequent sequels, there was no hint at all that Superman and Lois ever slept together. In fact, some fans are beginning to wonder if Superman is at all gay. Well, this movie dispels that speculation. The second twist was the “almost” death of Superman. Nobody expects Superman to die in this movie but the director plays it in such a way that death is somehow plausible to the point that it could be expected. It makes anybody watching to stay at the edge of their seat wondering correction, worrying about Superman. Overall, the plot is great.

The special effects used in the movie is simply awesome and way beyond the standards of the “old” Superman movie. Thanks in part to the latest advances in CGI technology and of course, to the Matrix who started it all. This time around, Superman’s cape is actually flowing when he is up in the air. The most unforgettable part of the special effects scene is Superman’s saving of a free falling Boeing airplane. Damn, it was simply exhilarating! The CGI animation of Superman is also quite realistic that there are times it is difficult to tell whether it is the actor doing the stunts or it was pure graphics.

As was mentioned, the director attempted and succeeded in humanizing Superman by making him vulnerable emotionally. Even so, there is a limitation to the humanizing factor. The development of Clark Kent on the other hand was somehow stunted in this movie. Here, Clark is literally a disguise. The old movies portray Clark Kent as somehow possessing a separate identity as an average Joe who is tired of being sacrificed to protect the identity of Superman. Notice the awkwardness Clark Kent exudes when he tries to be both nice and geeky as opposed to the natural macho and brutish persona of Superman. That separateness of identity becomes more acute that it came full blows in Superman 3. That tension is noticeably absent in the new movie. Furthermore, in the TV series, Smallville, there is no Superman persona but only Clark Kent. In the TV series, Clark is struggling to live a normal life even though he is anything but normal. Again, one can’t find that here in the movie. Brandon Routh plays well as Superman but he looks too smart and confident as Clark Kent than the traditional awkward geeky nice guy image that Clark should be. Lois Lane played by Kate Bosworth is still tough, feisty but is also somewhat mellowed down compared to the old Lois. She also exudes feminine beauty. I find that meallowing down to be a welcome change not that I’m a sexist but rather I find it to fit Lois’ new role as a mother of a 5 year old and a loving wife. Lex Luthor played by Kevin Spacey on the other hand is somewhat well, not exactly a disappointment or a let down but let’s just say, short of expectation. The problem is not in that Kevin Spacey’s acting (he is actually played the part well) but in both the director and the actor’s understanding of Luthor. The “old” Luthor played by Gene Hackman is flamboyant and displayed theatrical flair. He is the epitome of an arrogant mad genius who desired to become a king even for a day. Kevin Spacey’s Luthor by comparison seemed a lot more subdued and “quiet”. However, I don’t find that to be disturbing. In fact, I liked it. The “modern” depiction of Lex Luthor both in TV (Smallville) and in comic books is a shrewd, amoral, malevolent, manipulative, and machiavellian businessman/politician. Kevin Spacey in the first part of the movie adhere to this modern depiction. His portrayal of Luthor at this stage is best described as a “silent killer”. The problem with the portrayal came in the latter part of the movie when Luthor starts to unveil his evil scheme. Here, Kevin Spacey tried to imitate or more sarcastically, ape the flamboyance and flair of Gene Hackman, which turns out to be a total farce. Furthermore, the director and writer should seriously consider upgrading Luthor’s persona including his IQ. This is because I find his scheme less diabolical but more hairy, audacious, and also elementary. Lex Luthor’s scheme is to “sink” North America and replace it with the Krytonian crystal continet. There is only one problem to that scheme and that is, what they’re going to eat? I mean can you grow anything on an icy crystal wasteland? Ok, so they (Luthor and his cohorts) could make use of soiless farming or hydroponics technology but would that sufficed to feed a population? Furthermore, Luthor possesses the crystals, which contains among others advance Krytonian technologies and database collated from 28 known galaxies. There is somewhere within that database a blueprint on how to built a Weapon of Ultimate Destruction a.k.a. a Doomsday device, which he could use to blackmail the world. In spite of this, Lex Luthor is inexplicably infatuated with “real estate” (remember Superman 1?). Makes me wonder whether or not Lex Luthor is the “world’s greatest criminal genius” or simply the “most diabolical real estate developer the world has ever seen” and complete and utter failure at that! Apparently, the producers wanted to project the “gravity” and “evilness” of Luthor’s scheme and which is why they choose that scheme but it degrades the “seriousness” of the film.

Bryan Singer’s (the director) take on this latest movie on Superman is to focus on the two main characters, namely, Lois and Superman. The focus is so narrow that everybody else is relegated to second place including Clark Kent and Lex Luthor. The effect of this focus is to provide crystal clear clarity on the theme and is less likely to muddle the issue at hand. The director handles this kind of direction quite well. Too well, in fact that some point in the movie, I had this queasy feeling that it is more of a romance film rather than an action – adventure flick.

Overall, I find the film to be excellent and I actually liked it. It is as I said worth every penny paid. Aside from that, the facts being introduced in this film opens new avenues and possibilities as to the future direction of the film franchise. It would wet anybody’s curiosity as to what will happen to Jason, the super kid. Or how would the love triangle (Superman – Lois – White, the husband) or even the quadrangle (including Clark Kent) would unravel in the next few films. One could only wonder or even speculate but for now, I just like to say, “Welcome back, Superman!”