Innovation Workout Entrance Strategy

To Present Prepare for your group to present In 5-10 minutes Describe your product, current competitors, history and future on 1 slide Present a maximum of 1-2 slides per task (hand written) For each of your conclusions from Tasks #1 to #7 For sake of time, please to not include anything else

Setup for the Workout Pick a specific consumer product: Choose a product where you have a thorough knowledge of the market and competitors This is likely to be something that would be involved in a sport, hobby, job or other personal interest Quickly think through: Why customers buy this product (be honest) How customers buy this product (i.e., the consumption chain) Complementary products required to market this product Competences your firm needs to compete

Formulate an entrance strategy Setup for the Workout : Assume your company is going to produce its own brand of this product Formulate an entrance strategy Anticipating competitive behavior and response Planning to learn when uncertainty is high Assessing your project as it unfolds Rather than meeting objectives set in advance Remember You can’t be sure that your competitors will react as you expect You can’t be sure that technology, markets, etc. will pan out as you hope (or promise) You don’t want to be responsible for meeting ‘the numbers’ Where you have extreme uncertainty

Task #1: State your Vision First step in an entrance strategy is your ‘vision’ … your assessment of what the competitive future will look like What will this market look like in.5, 1, 5, 10 years What will this product look like in.5, 1, 5, 10 years

Task #2: Describe the Business Model Tell the ‘Story’ of how this Product becomes a profitable business Set target revenue and cost ‘Numbers’ for.5, 1, 5, 10 years How is your Business / Product different than everyone else’s

Task #3: List your major assumptions In any highly uncertain venture You make considerable numbers of assumptions What Assumptions will you make about your Market How will you test your Assumptions Your business plan should organized around converting the maximum number of assumptions to knowledge at minimum cost

Task #4: Specify your Major Milestones What will be your Milestones=Deliverables in.5, 1, 5, 10 years Milestones are points in time at which products are delivered and key assumptions are tested Usually these are events, e.g. complete design Sequence these to minimize cash burn and corporate expectations while you are learning No Milestone should occur without triggering a test of assumptions

Past is indicator of Future Future is Volatile For Task #4, Rememger that Sustainability is Industry Specific Different Industries Display Different Rates of Change in the Market Past is indicator of Future Future is Volatile

Task #5: Choose your first 3 Customers Specify your first 3 customers Your Lead-steer customers Opinion leaders in their industries Highly regarded by peers Customers with blogs, review or other sites These will help you to test your assumptions about attribute maps and consumption chains Risk Low Risk High Benefit Low 2nd Priority (make risk of not buying higher than of buying) Forget it! (postpone until value or risk Benefit High 1st Priority (easy sell) 3rd Priority (‘if it doesn’t work, send me the bill’)

Task #6: Who are your Combatants Task #6: Who are your Combatants? (or sleeping dogs, bystanders and skirmishers)? List them by name State why you categorize them as such Usually because of their market power, the coreness of the product to their capabilities, and their interest in this market Capacity to produce is High Capacity to produce is Low Commitment to enter market is Low Sleeping Dogs (track them) Bystanders (monitor) Commitment to enter market is High Combatants (Your main focus) Skirmishers (selective in their responses due to resource limits; monitor)

Task #7: Choose your Entry Tactics Choose One (only) of either an Offensive, Defensive or Deception tactic from the following list, and explain why this is the best tactic for you and your product to enter the market Objective: Avoid debilitating competitive interaction By using speed, skill and surprise Use your imagination, innovation, creativity to outmaneuver your competitors Rather than your scarce resources Assets should be bought only as a last resort Fixed commitments should be kept variable By paying per use, or by subcontracting

Entry Tactics Offensive tactics Deception Tactics Defensive tactics Rapid dominance Planned attack / frontal assault Flanking maneuver Pincer movement Double envelopment Attrition warfare Interdiction / control of lines of communication and supply Preemptive attack Raiding Divide and Conquer Guerrilla Warfare Defensive tactics Mutual support Scorched earth policy Booby traps Center Peel Trench warfare Hedgehog defense Deception Tactics Stealth and Camouflage Disinformation Feint Force multiplication

To Present Prepare for your group to present In 5-10 minutes Each of your conclusions from Tasks #1 to #7 Describe your product, current competitors, history and future on 1 slide Present a maximum of 1-2 slides per task (hand written)