TRANSFORMING A COMMUNITY TOWARD A KNOWLEDGE SOCIETY THE WINDS OF CHANGE

1. TRANSFORMING A COMMUNITY TOWARD A KNOWLEDGE SOCIETY THE WINDS OF CHANGE DR. KIP BECKER BOSTON UNIVERSITY KBECKER@BU.EDU GOGLOBAL@BU.EDU

2. WHAT IS KNOWLEDGE BASED? • WHAT DOES IT MEAN TO BE “SMART” • HOW TO GET THINGS DONE • WHERE THINGS ARE • SITUATION OPPORTUNITIES AND SOLUTIONS • CONSUMER ORIENTED – NEXT GENERATION “WANTS GOAL:A NATION OF “SMART” PEOPLE WITH “ATTITUDE” SMART • WHAT IT IS NOT: • ABOUT THE TECHNOLOGY / INFORMATION • QUEST FOR MAGICAL A SOLUTION OR BEING • A “WORLD CENTER”

3. LEARNING TO MANAGE INFORMATION TO CREATE VALUE RESOURCE RICH AFRICA INDONESIA OIL SURINAM BAXITE • VALUE ADDED SOLUTIONS Columba - Seattle Washington • India- Dominican Republic call centers

4. INTERNATIONAL COMPETITION NO FIRM OR GOVERNMENT NO MATTER HOW LARGE OR STRONG IS SAFE OLD RULES ARE OUT • “BIG STALE GUYS” NO LONGER RULE • MUST DRIVE OUT OLD ATTITUDES MARCU “CKomatsu • KNOWLEDGE AND “SMART” RULE

5. BUSINESS HAS REACHED END OF INCREMENTALISMCATCHING UP NOTTHESAME AS GETTING AHEAD Strategy NEEDS TO BE CREATED FOR THE FUTURE NOT FOR THE PRESENT FORWARD

6. THE WAY THE WORLD THINKS IS CHANGING MASS PRODUCTIONEngineering Model Make it  Store Inventory To Sell From Then Came 70s Early Information Importance LEAN JAPANESE MODELJust In Time (JIT), TQM, 6 SIGMA Match Production & Inventory / Sales INFORMATION AGE MODEL EMOTIONAL TECHNOLOGY AND CULTURAL INNOVATION Consumer Information  Produce BETTER, FASTER, CHEAPER then Today’s Competition

7. Cultural Innovation Emotional Technology OBM PRODUCT DESIGN ADD - VALUE VALUE ORIENTATION PRODUCTION ORIENTATION ODM OEM Production DESIGN STYLE Cultural Innovation“Buy me because through better marketing awareness of customer needs I am able to make you feel special in some important non specific non functional way such as the elegance and lack of clutter associated with the Apple Computer brand, the beauty of the Asus netbook’s exterior finish or integrated ease of use, or the playfulness of some Asian cell phone packaging”. Emotional Technology“Buy me because through incorporating technology I am better on some powerful but specific functional criteria such as lower price or lower weight” (as seen in the netbook’s list of features); iphone apps

8. THOSE “NON KNOWLEDGE” ADVANTAGES CAN BE TRANSITORY POLAROID -KODAK FUJI • MORANO GLASS PLANS FOR THE FACTORIES OF LOWEL STOLEN FROM ENGLAND • HISTORY OR RUBBER • Manaus 1890-1920

9. COMPETITIVE ADVANTAGES • SUBJECT TO: • SHIFTS IN CONSUMER DEMAND • LACK OF PROTECTION OF TECHNOLOGY • REPLACEMENTS OF PRODUCTS BY TECH OLD ADVANTAGES • Low cost labor/ Labor relationships • Favorable debt financing • Domestic subsidies • Protected home markets • Superior tax systems • NEW ADVANTAGES • “Smart” Society • Consumer aware • Responsive Infrastructures • Education • Enthusiastic to Change and Quick to market • Technology & Innovation Driven • Competition based on “Knowledge” Advantages

10. FRONTAL STRAGEGY CAN BE SUCCESSFUL WHEN FIRM UNDERSTANDS WHAT CONSUMER WANTS? Caterpillar A guarantee: equipment, on a desert airport project or Arctic Circle oil would be fixed quickly

11. SMART MEANS WINNING BY FLANKING FLANKING • Attack the market where the competitor is weakest • INFORMATION INTENSIVE 60S JAPANESE CARS, COPIERS MOTORCYCLES 2000s KOREA COMPETITION Sidewinder

12. SMART WINNING BY TECHNOLOGY BYPASS WATCHES SWISS to CITIZENS, SIEKO Offering new product making theirs unnecessary RESEARCH & CONSUMER INTENSIVE Japan TOTO COMPETITION POLAROID -KODAK FUJI

13. THREE NATIONAL STORIES SHANGAI DUBAI BRAHAIN

14. The problem is not really so much how to get new, innovative thoughts into your mind, but how to get old ones out “I THINK THERE IS A MARKET FOR MAYBE FIVE COMPUTERS” - THOMAS WATSON CHAIRMAN IBM 1943“THERE IS NO REASON ANYONE WOULD WANT A COMPUTER IN THEIR HOME” – KEN OLSON, PRESIDENT CHAIRMAN FOUNDER DIGITAL EQUIPMENT 1977 “It is generally much easier to kill an organization than change it substantially.” • Kevin Kelly, Out of Control

15. Knowing what the CUSTOMER wants not just what you want to make INNOVATION’S KEY IN GLOBAL STRATEGY

16. Technology, friend or foe? 1097 Pope Urban II outlawed crossbow THE DUTCH FLOWER GROWERS (DFA) AND THE TELE-FLOWER AUCTION (TFA) 11,000 SELLERS 3,500 FLOWER TYPES 5,000 BUYERS 120 AUCTION GROUPS

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19. SPEED AND FLEXIBILITY DEMANDS Facebook 1 yr

20. PRODUCTION SERVICES PRODUCTIVITY GOODSSERVICE 20

21. WHAT DOES IT TAKE? NEVER HAS ENVIRONMENT BEEN MORE RECEPTIVE TO NEW IDEAS & MORE HOSTILE TO EXISTING FIRMS and NATIONS(KNOWLEDGE)COMPANIES MORE LIKELY TO BE AMBITION CONSTRAINED THAN RESOURCE CONSTRAINED

22. KEEPING UP WITH CHANGETechnology & Pace of Change SIU AND CHINESE BASEBALL • SONY WALKMAN HAS HAD TO PRODUCE 160 MODELS SO SUSTAIN IDENTY AGAINST CLONES • 1976 TEXAS INSTRUMENTS 90%MK SHARE LOW PRICED DIGITAL WATCHES ($19.95) • 1983 LOW END IS $3.00 TI CAN NOT BE PROFITABLE • In only 7 years TI went from MK leader to extinct

23. PART OF GAME OF DEVELOPING INTERNATIONALLY COMPETITIVEKNOWLEDGE BASED SOCIETY IS BEING INTERNATIONAL WHAT TO DEVELOP? • HOW MUCH CONTROL ARE YOU WILLING TO GIVE UP? WHAT / HOW TO ASSIMILATE? • WHAT CHANGES TO CULTURE ARE EXPECTED? • WHAT IMPEDIMENTS TO CHANGE?

24. THANK YOU