in Organizations

I am in Love with John Hagel

…or at least his writing. In his latest post he offers an alternative to Porter’s three generic strategies and looks at the Siemens/BenQ situation through this lens

I have anticipated that all companies over time will unbundle into three much more focused business types – infrastructure management businesses, product innovation and commercialization businesses and customer relationship businesses.

…in my terminology, BenQ had become very successful as a focused infrastructure management business, leveraging not only low wage rates in Asia but rapid incremental innovation to deliver increasingly sophisticated and reliable products in markets around the world. It has developed world class capabilities in terms of managing high volume, routine processing activities and designing products for manufacturability.

All well and good – very consistent with the broader themes I have described. But the Siemens acquisition that took effect in October of 2005 came out of left field. Now BenQ was diversifying from a focused behind the scenes manufacturer and designer into a full-fledged product innovation and commercialization company with its own brands and distribution operations in Western companies.

He then widens this lens to look at Chinese businesses…

…Many Chinese companies unfortunately suffer from something that I have described as Western envy. Despite enormous success in pioneering innovative business models and business practices, many entrepreneurial Chinese companies still have a sense of inferiority and want to look like larger Western companies with their own manufacturing, R&D and sales and marketing operations. The irony is that, just as many Western companies are unbundling (in part offshoring and outsourcing to more focused Chinese companies), many Chinese executives are tempted to build more tightly bundled operations that mimic the model many Western companies are abandoning.

  1. Hagel is definately slick. And one should always beware of slick consultants selling slick words.

    Don’t forget his spectacular, money buring failure called 12 Entrepreneuring. While yes failure is crucial to learning, the scale of this failure suggests that this wasn’t Hagel trying out some ideas to see what works. Rather it suggests that he had no clue what would work and what wouldn’t.

    That said, I too really like a lot of what he writes.

  2. Am I missing it… Do you have a link for those quotes?

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