High‐tech 2005: the horizontal, hypercompetitive future

Vivek Kapur (Vivek Kapur, a strategy partner in IBM Business Consulting Services’ Electronics practice, serves clients that include global leaders in high tech and consumer products (vivek.a.kapur@us.ibm.com). Based in San Francisco.)
John Peters (John Peters, a principal consultant in IBM Business Consulting Services’ Electronics practice, consults on corporate strategy issues (john.s.peters@us.ibm.com). Based in San Francisco.)
Saul Berman (Saul Berman, an IBM Business Consulting Services partner based in Los Angeles, is the global strategy and business development executive for the firm’s strategic change practice (saul.berman@us.ibm.com). He leads the IBM Future Series program that charts strategies for succeeding in markets undergoing profound change. A product of the program, this groundbreaking article on the future of high tech, is part of a series appearing in Strategy & Leadership. IBM’s global electronics practice advises clients on business and technology issues including corporate, business, operations and program strategy, IT planning and management, and business process improvement http://www.ibm.com/services/strategy/industries/electronics.html).)

Strategy & Leadership

ISSN: 1087-8572

Publication date: 1 April 2003

Abstract

Profound and lasting changes are afoot in the high‐tech industry. Only those high‐tech companies that align their business models for the new horizontal and hypercompetitive future will succeed. The seven deadly signs of the new competitive environment are: (1) growing downward pressure on price with an ever‐increasing demand for greater performance; (2) greater complexity for customers as they face the unbundling of hardware options, integration choices, and multi‐company business coordination; (3) a new distribution of value: greater value to innovative component makers and solution integrators; less value for product design and assembly; (4) branding and customer relationships will differentiate commodity products; (5) collaborative networks will emerge; (6) global supply and global customers will mean global organizations; (7) competitors will encroach horizontally. Recommendation: proceed with a five‐step approach to develop a new winning strategy: (1) pick a horizontal space; (2) redefine and Web‐enable your value propositions; (3) assemble your collaborative networks; (4) integrate your internal operations globally; and (5) realign your organization and technology. Studies demonstrate that during downturns, advantage shifts to companies that continue to invest strategically.

Keywords

Citation

Vivek Kapur, John Peters and Saul Berman (2003) "High‐tech 2005: the horizontal, hypercompetitive future", Strategy & Leadership, Vol. 31 No. 2, pp. 34-47

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DOI

: https://doi.org/10.1108/10878570310698106

Publisher

:

MCB UP Ltd

Copyright © 2003, Company

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