This was a 45 minute webinar in which we broke down why only 25% of attempts to build new businesses out of your core business (adjacent businesses) succeed and how you can increase your chances of success to 80%. You must draw on core theories of growth and the resources based view (or RBV).
The Coffee Bean & Tea Leaf(CBTL), Business strategy case study
Finding your next big growth idea
1. Shannon Wallis & Kaihan Krippendorff All Rights Reserved.
Featuring: Kaihan Krippendorff
Brought to you by
Finding
Your
Next Big
Growth
Idea
Photo: flickr user Francesca Guadagnini
2. Shannon Wallis & Kaihan Krippendorff All Rights Reserved.
Kaihan Krippendorff
www.outthinker.com
3. Shannon Wallis & Kaihan Krippendorff All Rights Reserved.
Webinar objectives
Learn what the “Resource Based View” (RBV) tells us about generating
business growth.
Know the three places to look for adjacent growth opportunities.
Know the four factors that will determine if you idea will really provide a
sustainable competitive advantage.
4. Shannon Wallis & Kaihan Krippendorff All Rights Reserved.
You Move Me
5. Shannon Wallis & Kaihan Krippendorff All Rights Reserved.
You Move Me
• 25 franchisees day 1
• $17M in first calendar year
6. Shannon Wallis & Kaihan Krippendorff All Rights Reserved.
Growth horizons
Core business: grow
value, revenue, and margin
Adjacent: build and grow
adjacent businesses
Options: create
growth options
Visions: to guide the
search for growth
Exits: business to close or sell
7. Shannon Wallis & Kaihan Krippendorff All Rights Reserved.
Growth horizons
Core business: grow
value, revenue, and margin
Adjacent: build and grow
adjacent businesses
Options: create
growth options
Today’s Focus
8. Shannon Wallis & Kaihan Krippendorff All Rights Reserved.
“The average company
succeeds only 25% of the time
in launching new initiatives.”
- “Growth Outside the Core” HBR, Chris
Zook and James Allen
10. Shannon Wallis & Kaihan Krippendorff All Rights Reserved.
“Growth Outside the Core” HBR, Chris
Zook and James Allen
“Companies that have hit upon
a repeatable formula have
success rates of twice that, and
some drive their rates up to
80% or higher.”
-
11. Shannon Wallis & Kaihan Krippendorff All Rights Reserved.
Resource Based View (RBV)
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Lock up resources
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Lock up resources
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Apple uses RBV
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Where to look
Tangible
Intangible
Capabilities
Key components
Raw materials
Technology
Equipment
…
Brand reputation
Employee engagement
Customer loyalty
IP
…
Supply chain
Management skill
Specialty knowledge
Production
…
17. Shannon Wallis & Kaihan Krippendorff All Rights Reserved.
Where to look
Tangible
Intangible
Capabilities
Key components
Raw materials
Technology
Equipment
…
Brand reputation
Employee engagement
Customer loyalty
IP
…
Supply chain
Management skill
Specialty knowledge
Production
…
Inimitable
Valuable
Rare
To identify a valuable resource:
Non-
substitutable
Source: Barney, 1991a, 1994, 2002
18. Shannon Wallis & Kaihan Krippendorff All Rights Reserved.
Breaking down You Move Me
Tangible
Intangible
Capabilities
Key components
Raw materials
Technology
Equipment
…
Brand reputation
Employee engagement
Customer loyalty
IP
…
Supply chain
Management skill
Specialty knowledge
Production
…
Inimitable
Valuable
Rare
To identify a valuable resource:
Non-
substitutable
Source: Barney, 1991a, 1994, 2002
19. Shannon Wallis & Kaihan Krippendorff All Rights Reserved.
What to do now
1. Inventory your unique resources
• Tangible
• Intangible
• Capabilities
2. Assess which are truly defensible
• Rare
• Inimitable
3. Brainstorm ideas from those that are defensible
• Valuable
4. Conduct a fact-based analysis to assess your potential competitive
advantage
• Rare
• Inimitable
• Non-substitutable
• Valuable
5. Build a business case, test, launch, monitor, adjust
20. Shannon Wallis & Kaihan Krippendorff All Rights Reserved.
kaihan@outthinker.com
www.outthinker.com
@kaihan
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Hinweis der Redaktion
The RBV sees companies as very different collections of physical and intangible assets and capabilities. No two companies are alike because no two companies have had the same set of experiences, acquired the same assets and skills, or built the same organizational cultures. These assets and capabilities determine how efficiently and effectively a company performs its functional activities. Following this logic, a company will be positioned to succeed if it has the best and most appropriate stocks of resources for its business and strategy.
Valuable resources can take a variety of forms, including some overlooked by the narrower conceptions of core competence and capabilities. They can be physical, like the wire into your house. Potentially, both the telephone and cable companies are in a very strong position to succeed in the brave new world of interactive multimedia because they own the on-ramp to the information superhighway. Or valuable resources may be intangible, such as brand names or technological know-how. The Walt Disney Company, for example, holds a unique consumer franchise that makes Disney a success in a slew of businesses, from soft toys to theme parks to videos. Similarly, Sharp’s knowledge of flat-panel display technology has enabled it to dominate the $7 billion worldwide liquid crystal display (LCD) business. Or the valuable resource may be an organizational capability embedded in a company’s routines, processes, and culture. Take, for example, the skills of the Japanese automobile companies—first in low-cost, lean manufacturing; next in high-quality production; and then in fast product development. These capabilities, built up over time, transform otherwise pedestrian or commodity inputs into superior products and make the companies that have developed them successful in the global market.
The RBV sees companies as very different collections of physical and intangible assets and capabilities. No two companies are alike because no two companies have had the same set of experiences, acquired the same assets and skills, or built the same organizational cultures. These assets and capabilities determine how efficiently and effectively a company performs its functional activities. Following this logic, a company will be positioned to succeed if it has the best and most appropriate stocks of resources for its business and strategy.
Valuable resources can take a variety of forms, including some overlooked by the narrower conceptions of core competence and capabilities. They can be physical, like the wire into your house. Potentially, both the telephone and cable companies are in a very strong position to succeed in the brave new world of interactive multimedia because they own the on-ramp to the information superhighway. Or valuable resources may be intangible, such as brand names or technological know-how. The Walt Disney Company, for example, holds a unique consumer franchise that makes Disney a success in a slew of businesses, from soft toys to theme parks to videos. Similarly, Sharp’s knowledge of flat-panel display technology has enabled it to dominate the $7 billion worldwide liquid crystal display (LCD) business. Or the valuable resource may be an organizational capability embedded in a company’s routines, processes, and culture. Take, for example, the skills of the Japanese automobile companies—first in low-cost, lean manufacturing; next in high-quality production; and then in fast product development. These capabilities, built up over time, transform otherwise pedestrian or commodity inputs into superior products and make the companies that have developed them successful in the global market.
The RBV sees companies as very different collections of physical and intangible assets and capabilities. No two companies are alike because no two companies have had the same set of experiences, acquired the same assets and skills, or built the same organizational cultures. These assets and capabilities determine how efficiently and effectively a company performs its functional activities. Following this logic, a company will be positioned to succeed if it has the best and most appropriate stocks of resources for its business and strategy.
Valuable resources can take a variety of forms, including some overlooked by the narrower conceptions of core competence and capabilities. They can be physical, like the wire into your house. Potentially, both the telephone and cable companies are in a very strong position to succeed in the brave new world of interactive multimedia because they own the on-ramp to the information superhighway. Or valuable resources may be intangible, such as brand names or technological know-how. The Walt Disney Company, for example, holds a unique consumer franchise that makes Disney a success in a slew of businesses, from soft toys to theme parks to videos. Similarly, Sharp’s knowledge of flat-panel display technology has enabled it to dominate the $7 billion worldwide liquid crystal display (LCD) business. Or the valuable resource may be an organizational capability embedded in a company’s routines, processes, and culture. Take, for example, the skills of the Japanese automobile companies—first in low-cost, lean manufacturing; next in high-quality production; and then in fast product development. These capabilities, built up over time, transform otherwise pedestrian or commodity inputs into superior products and make the companies that have developed them successful in the global market.
The RBV sees companies as very different collections of physical and intangible assets and capabilities. No two companies are alike because no two companies have had the same set of experiences, acquired the same assets and skills, or built the same organizational cultures. These assets and capabilities determine how efficiently and effectively a company performs its functional activities. Following this logic, a company will be positioned to succeed if it has the best and most appropriate stocks of resources for its business and strategy.
Valuable resources can take a variety of forms, including some overlooked by the narrower conceptions of core competence and capabilities. They can be physical, like the wire into your house. Potentially, both the telephone and cable companies are in a very strong position to succeed in the brave new world of interactive multimedia because they own the on-ramp to the information superhighway. Or valuable resources may be intangible, such as brand names or technological know-how. The Walt Disney Company, for example, holds a unique consumer franchise that makes Disney a success in a slew of businesses, from soft toys to theme parks to videos. Similarly, Sharp’s knowledge of flat-panel display technology has enabled it to dominate the $7 billion worldwide liquid crystal display (LCD) business. Or the valuable resource may be an organizational capability embedded in a company’s routines, processes, and culture. Take, for example, the skills of the Japanese automobile companies—first in low-cost, lean manufacturing; next in high-quality production; and then in fast product development. These capabilities, built up over time, transform otherwise pedestrian or commodity inputs into superior products and make the companies that have developed them successful in the global market.