by Adam Hartung | Apr 18, 2005 | Disruptions, General, In the Rapids, Innovation, Leadership, Lifecycle, Openness
Far too often we see companies merge in an effort to save an old Success Formula. The goal of the acquistion is to Defend & Extend an outdated business model by bringing together two less than stellar competitors. Because this is so common, it’s easy for analysts and pundits to become very jaded regarding acquisitions and mergers.
Today, however, just the opposite happened. Two good, high growth companies decided to merge in order to create new growth opportunities. Rather than merging to find cost synergies, they are merging in order to find new markets, develop new products and further grow.
The two companies are Adobe and Macromedia. According to MarketWatch "Both companies said the long-rumored acquisition was not to consolidate and cut costs but to help Adobe expand into new markets, particularly in the area of providing content to mobile phones and other handheld devices….This is not a consolidation play. This is all about growth," said Bruce Chizen, Adobe’s chief executive."
Because most acquisitions are about D&E, the stock market punished Adobe upon the announcement – sending it’s stock down about 10%. However, acquisitions and mergers can be very effective tools for creating white space and developing new growth opportunities. We should keep our eyes on Adobe, and consider it for a long term investment, since this could be the move that spurs its growth for another decade.
by Adam Hartung | Apr 12, 2005 | General, In the Rapids, Innovation, Leadership, Lifecycle, Openness
Louis Gerstner’s best selling book on IBM was "Who says elephant’s can’t dance." Now his successor looks to be a pretty good elephant trainer himself.
IBM has loaded itself up with more White Space projects. This behemoth is fast moving out of hardware (selling its PC business, for example) and moving into value-added process management. It’s using both divestitures and acquisitions to disrupt itself, and then using White Space to develop new opportunities.
Read the latests article in BusinessWeek for details. Let’s just say here that if IBM keeps spawning these White Space projects it can keep itself in the Rapids for quite a long time. You don’t have to be small to succeed – just willing to be disruptive and use White Space
by Adam Hartung | Nov 1, 2004 | Openness
While reading Seth Godin’s blog today, I was struck by his point about the power of videotape to shape behavior. He was commenting on the shabby way that he was treated while trying to buy a lobster and he wondered:
So, the two questions are, “Do you think the owner wanted them to act this way?” and “Would they have acted differently if they were on camera?”
What a delightful line of thought! One of the key design principles for being able to build a self-renewing organization is “openness.” Why? Openness prevents abuses. People who are going to do unethical things don’t want anyone to know about it, that’s why they require secrecy. (Why do you think they call them “shady” dealings?) Whether its employees who our mistreating customers, or senior managers who are looting the company for personal gain, they all depend on secrecy.
Behaviors like that are like cockroaches: they like dark places out of peoples’ view. But when you shine a light on them, they scatter. That’s the affect of openness on unethical, illicit, and illegal behavior.
Great organizations of any kind (including countries) only prosper in a climate of openness. I wonder what would happen if everyone in a company behaved as if their every move were being broadcast live to the world. I guarantee that they would change their behavior! How could your organization benefit from more openness? What can you do to increase openness in your organization?
