Tag Archives: strategy

What Went Wrong with Apple Maps?

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By Denise Harrison
Apple is world renowned for its innovative product introductions – but as you look back over history, there have been plenty of flops to go along with the successes. Think about Ping and Rokr – oops, you missed these? Most people did. And, the introduction of the Apple Map application was another clunker. Using Maps, you were driven into dead ends; airport runways were specified as roads, and general requests often put you in a wrong location (yes, you ask for a hospital and get a restaurant.)

What happened? Most simply, Apple underestimated the task:
• Dedicated team was too small
• Team did not have the required competencies
• Testing was local (Maps worked well in Cupertino)

What did Apple do to recover?

Reassessed the importance of the application:
o If deemed important then move forward
o If not, use a third party provider, Apple does this for lots of applications it deems “non-mission critical”
o In this case, Apple decided that the application was critical.
Reassessed the true resourcing and capabilities requirements. The team now has thousands of members (versus a few hundred) and the team has diverse skill sets including how to use “big data” real time (traffic).
Broadened the testing – this meant a move to public testing. This decision forced Apple to move away from its traditional secrecy policy. Large numbers of users in many geographic locations were needed to get the kinks out of Apple Maps.

What does this mean for us?

When executing your strategy, you will need to select a few strategic initiatives (projects) that you need to accomplish. That number should be around 6-10, fewer if you have a large enterprise-wide project. Next you need to develop action plans for each project, with clear action steps, who is responsible and how much time and money each step will take. Assess the resources required for each action plan. Are you under-resourcing and dooming the project to failure?

Once you embark on your strategic initiatives, you may need to make course corrections – did you underestimate the scope of the project – if so, reassess and fix it.

Once a project is complete (or it bombs), do a “lessons learned”:
• What went right?
• What did not go well?
• What will we do differently in the future?
While Apple does not always hit homeruns, it does learn from its mistakes. Apple now uses public testing for many of its new releases – a real divergence to its former cloak of secrecy.

If you have additional questions about strategy development or implementation, please email Denise Harrison at harrison@thestratplan.com or call 910-763-5194.

CVS Envisions a Different Future

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May16

By Denise Harrison, President, Spex, Inc.

Over the years CVS has transitioned its business from a traditional drug store format to become more of a health care company. Why? Some trends indicated that more profitability came from its sale of prescription drugs, so a focus on health care rather than consumer products made sense. To further its movement into being a healthcare provider, it purchased MinuteClinic and opened MinuteClinics providing routine diagnosis, screening and vaccinations in many of its stores. CVS is now the biggest operator of health clinics and dispenser of prescription drugs in the US. Surprised?

What Would CVS Give Up to Continue its Focus on Providing Healthcare?

Focusing on transitioning from drug store to healthcare provider may seem like a no-brainer – but what did this move mean that CVS would have to give up? If the company was truly focused on health and wellness, how could they continue selling cigarettes? Thus, in 2015 it made the decision to stop selling tobacco products – losing $2 billion of CVS revenue.

Gutsy move – maybe. Or were they just seeing the trends and positioning themselves for the future? Some statistics on smoking adults:

  • 1965: 43%
  • 2014: 18%

As you can see the trend away from smoking is significant and if this continues down to below 10% as is expected, tobacco products would a declining revenue source. In addition, with cigarettes off the shelves, partnerships with regional hospitals were easier to form.

Key Take-Aways

  • Do you have a vision of what your company needs to look like in 10 years? An idea of what it will take to be successful?
  • Are you willing to give-up current business to focus on positioning your company for future success?

Giving up revenue and profit is a difficult decision, but companies who are willing to make these though choices may position themselves for long-term success.

If you are ready to assess what it will take to make your company successful in the future, please contact me at: 910-763-5194 or harrison@thestratplan.com and we can discuss how to develop a strategy that will position your company for future success.

 

Strategic Planning: What Did You Learn? How One Company Went Off Course

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April 16 wordle

“Follow the plan; don’t get distracted by seemingly large opportunities,” replied one CEO when asked the question: What was one key learning from following a systematic approach to strategic planning. How did he learn this? The hard way, of course.

For years, this CEO and his team used a systematic approach to strategic planning.  That approach uses data and information to help teams focus on the areas that will optimize their future results.  In his case, we identified small-medium sized organizations as one target segment.  We also identified that the larger organizations in this industry had requirements that were beyond our core capabilities.  By focusing our efforts on the smaller organizations we would match our core capabilities with the requirements of this business segments.  This strategy proved to be successful.

 What happened subsequently?

Well, a Board member had connections to a large prestigious organization and wanted the CEO’s company to become its supplier.  The opportunity for revenue growth was significant; the Board member pushed and this CEO’s company took on the large organization as a customer

 Outcome

Resources were pulled from all areas of the company to meet this large organization’s requirements – pulled away from serving the smaller targeted organizations.  The large organization may have increased top line growth, but it had a significantly negative impact on the bottom line and hurt relationships with the customers that we had determined were the best fit with our core capabilities.

Lessons Learned

It is important to stick with your strategy unless something has changed in the business environment and/or your core capabilities.

 Can You Make Exceptions?

Of course, but ensure that your exception make sense.  For instance, in this example the following question should have been asked:

  •  Do the requirements of this large prestigious organization map to what the requirements of large organization or small-medium sized organizations?

If the answer is the requirements look like the large segment, then we should say no. If the answer is the requirements look like the ones we usually find in our small-medium sized organizations and map with our core capabilities, then this exception is acceptable.

Sticking to your strategy may require discipline in the face of a large revenue opportunity. Use your strategy to determine its fit with your organization’s capabilities.  Once you have a strategy, use it to assess a specific situation to see if an exception is warranted.

For information on strategy development please contact Denise Harrison at: 910-763-5194 or harrison@thestratplan.com.

©2015 Spex, Inc., Wilmington, NC 28401

Reprint permission granted, with attribution.

From Near-Bankruptcy to Market Leadership: LEGO’s Success is Child’s Play

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DeniLego bricks picturese Harrison, President and CEO, Strategic Planning and Execution, Spex, Inc.

What would you do if you were faced with potential bankruptcy, with a product line that is over half a century old? Product line extension? Expansion into new lines of business? Sell the company? LEGO was facing this dilemma in 2001. While the first step was to return profitability to the core by streamlining the business; this was not enough to position LEGO to succeed in the future. Did the company need to better understand retail distribution? No, it was a better understanding of how children play that really turned the company around. How do children really play with the bricks? What do they like doing? What is missing? Learning the answers to these questions allowed LEGO to surpass Mattel in size, even though Mattel has a much wider range of products. The answers to the following questions helped LEGO reconnect with its user base and its parents:

  • Is the way that children play different in North America, Europe and Asia? By understanding the cultural differences, LEGO was better able to position itself to meeting the requirements of these different end markets. Now Asia is one of its fastest growing markets.
  • Do girls play differently and use s differently than boys? Tapping into the female market was another key to LEGO growth. LEGO Friends became a play theme that was more interesting to girls. But do girls like to build? Yes, building is one of the key attributes of this play themes success.
  • What about adults? Do they use LEGO bricks? Apparently yes, who said LEGOs are just for kids? The popularity of LEGO Architecture is one of the success stories in the adult segment.

Historically, LEGO was primarily focused on boys 5-11; but by better understanding this segment and how play occurs, they were able to introduce a number of new products and product themes. And when the team truly understood what little girls were looking for and then expanded applications to adults the company really took off.

What is next for LEGO?

Over the last few decades, video games and the overall digital experience have grown to be powerful disrupters to the traditional toy and game market, and now, LEGO must truly understand how the LEGO brand fits with the digital experience. It is currently working with ways to build structures, take a picture of the structure and have it become part of a digital game. This tailors the video game experience to the individual user as the user adds unique structure to the video experience. How LEGO integrates the building experience with the digital experience will be the next challenge the company will face.

What does this mean for me?

As you develop your strategy, it is important that you truly understand your end users and how they use the products and services that you provide. Understanding the environment and what really works and what does not work will enable you to develop a broader and deeper understanding of the application and what you can do to make it easier, better, faster, more intuitive for the user. In addition, understanding how segments that are not currently targeted could use the product is another avenue for growth. Are there unmet needs in your market because no one has thought through how different users might use your product? How often do you go to trade shows in unrelated markets to come up with thoughts of new applications for your product? What about new trends? Do you face a disruptive trend similar to LEGO facing video games as an alternative for how your customers will spend their money? Do you hide your head in the sand, or look for ways to integrate the new product or service into the experience for which your customers are looking?

Bottom-line

 Understanding your users and future users and the user experience will be important to your long-term success. Get out and spend time with customers while they are using your products and keep an open mind. This knowledge will add to the information that you will have to make good strategic decisions.

Interested in learning how to integrate information into your strategic planning process to come up with better results? Please call or email me, Denise Harrison at 910-763-5194 or harrison@thestratplan.com.

© Spex, Inc. Wilmington, NC, 2015, Reprint permission granted with full attribution.