In 2011 GE initiated a radically new business model which derived revenues from ongoing improvements in existing infrastructure. The instrument for delivering these improvements was GE’s industrial internet enabled digital transformation strategy – a multibillion dollar program to add digital sensors to machines to monitor operations data and building advanced analytic capabilities to improve the productivity of installed hardware.
There is a common misconception that business ownership is equivalent to Entrepreneurship. This is conventional wisdom. For instance, a man launching a fast food restaurant is certainly holding a stake and taking a certain amount of risk. But is he creating a new consumer demand or fulfilling the unmet needs of a consumer? It is apparent that he is relying on the popularity of eating out. Therefore, there are pertinent questions to be addressed in order to evaluate whether one is an Entrepreneur. Let us name an imaginary business owner as Adam and assess whether he is an entrepreneur through the following questions :
The term “Business model” is defined distinctly by various entities and schools of thought. There are numerous underlying assumptions that have to be validated in order to arrive at a cogent definition. The rising importance of business models so far has been a logical reaction to numerous choices in the market. However, the changes in the business models should be automatic, reflexive and spontaneous.
As companies achieve parity with their competitors on products, technologies and services, analytics is emerging as the new arena of the war to gain competitive advantage.
Using analytics, companies now know what products their customers want, what prices they will pay, what will motivate them to buy more, how much each employee contributes to the bottom line and how salary levels relate to an individual’s performance. Analytics permitted Amazon to be instrumental in turning in a profit inspite of making huge investments in infrastructure and customer acquisition.
What comes to our mind when we think of innovation ? When we come across the term innovation, we often think of it as something that is cutting edge or a technological innovation. But innovation is not just restricted to this aspect. Innovation is boundless.
Disruptive innovation is any situation in which new entrants using different business model win over customers of previously successful incumbents. Right? Not necessarily.Disruptive innovation is a process where a smaller company successfully challenges a bigger incumbent but not by targeting the most attractive customers of the incumbent. The entrant targets less attractive foothold markets. These are of two types. i) Under served customers who have lower expectations and lower willingness to pay a high price. Like the market for small cars in the US in the 1970s. ii) Non-users of a category. Like non users of personal computers in the 1980s and non users of radio in the 1960s. These segments proved to be the major markets for desktop computers and transistor radios.Read More
In 2007 a weak Apple with less than 4% market share in desktop operating systems and none in mobile phones was surrounded by five 800 pound gorillas – Nokia, Samsung, Motorola, Sony Ericsson and LG. These corporations controlled 90% of the industry’s global profits. The iPhone was introduced in 2007. By 2015, the iPhone singlehandedly generated 92% of global profits, while all but one of the former incumbents made no profit at all.
Apple, along with Google’s competing android system decimated the competition by exploiting the power of platforms and leveraging the new rules of strategy.
It’s a good time to be an entrepreneur in India. Indians are dreaming, innovating & creating. Chase your dream – funds will come. Have an idea? Launch a venture !