Cisco, HP, IBM, Microsoft.... the end of the IT Titans?
For those of you who are not yet convinced, the Cloud really is a rupture in the market, perhaps not so much from the clients’ point of view, but definitely from that of the manufacturers.
In the wake of the success new market players are experiencing, the historical Titans of IT now have to accelerate their change process and they face 10 challenges.
1. The challenge of corporate culture Corporate culture does not stop at company staff it is much bigger than that. It includes shareholders and investors as well as partners and distribution channels. You have to be agile to change it, as Michael Dell understood when he took his company off the stock exchange.
2. The challenge of inertia Any system that creates wealth also creates a parallel organization, whose visible parts are: processes, information structure, team organizations, work contracts. Enterprises need such organization to exist, but these also hinder change. The capacity rethink an organization for a new business model (eg: SaaS or Cloud) interferes in competitivity and in gaining market shares. The Titans are used to working with certain habits which can be bad habits in a market where it is vital to be able react quickly.
3. The challenge of the rule of law A business with a storefront cannot move without changing its environment. Cutting 5000 jobs in one place to create 300 in another without interfering in the business growth process is no easy feat, particularly in a country like France which is paralyzed in the face of change. With the best will in the world, the CEO is legally responsible for the application of laws which were in no way designed to favor the rapid adaptation of businesses to a changing context.
4. The challenge of innovation Normally, in an ideal world this should be the first point, but every innovation needs the right environment to thrive. Xerox invented the mouse, but Apple sold it. Bull invented the PC but IBM sold it ... "Right time, right product and right place"...Innovation is central to a company’s ability to break away from the competition. This innovation may be technological (e.g.: Google vs. Microsoft) or in the optimization of processes (e.g.: McDonalds compared to traditional restaurants) or simply in terms of pricing (e.g.: Free vs. Orange). You need to be able bring an innovation into an environment that is ready to value the change it brings.
5. The challenge of legibility. The Titans all share the characteristic of having significantly expanded their range of solutions and products, thereby diluting their overall market visibility. Microsoft makes games as well as CRM… Microsoft makes everything. It is difficult to enjoy excellence when your brand perception is necessarily the average overall perception of a complete catalogue. So how can you ensure that a brand’s “average” is that of leader when up against a lesser known pure player with a communication strategy 100% dedicated to their innovation?.
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