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Word Count- 1619 /PIN-10574

Subtopic 3: Find the Next Wave to Ride On—New Business Strategies

in the Changing World

Seize the Spring of Hope“It was the best of times, it was the worst of times; it was the spring of hope, it was the

winter of despair.” When we read this sentence which was written about 150 years ago, it seems that it is well prepared for today’s world.

Nowadays, the world is changing more rapidly than it has ever been. Almost every day anew trend comes into our sight. These trends produce opportunities, but also cause troubles.

For most people, they just need to choose whether to follow a trend or not. However, for business entities, decisions are not that easily made. When a trend comes, some companies choose to follow the trend, while some choose to ignore it. It is hard to say whether their decisions are right or wrong because it depends on what the trend is and how they deal with the trend. But one thing is certain: for a company, to survive is the top issue.

Every day, hundreds of companies come into the world, while hundreds of companies leave the world. Except for those internal factors, perhaps the greatest external factor is the trend. Some companies are born in a trend, while some die in a trend. Of all the examples, the best known ones are Google and Netscape.

If Netscape was the standard bearer for Web 1.0, Google is most certainly the standard bearer for Web 2.0. When the era of Web 2.0 came, which symbolizes the end of the software release cycle and the beginning of software above the level of a single device, Netscape left the stage of history, and Google became a household word. For the sake of understanding the reasons that Netscape was unable to adapt to Web 2.0, let's make a comparison of these two companies and their positioning.

Netscape framed "the web as platform" in terms of the old software paradigm: their flagship product was the web browser, a desktop application, and their strategy was to use their dominance in the browser market to establish a market for high-priced server products. Control over standards for displaying content and applications in the browser would, in theory, give Netscape the kind of market power which was enjoyed by Microsoft in the PC market.

Google, by contrast, began its life as a native web application, never sold or packaged, but delivered as a service, with customers paying, directly or indirectly, for the use of that service. None of the trappings of the old software industry are present. No scheduled software releases, just continuous improvement. No licensing or sale, just usage. No porting to different platforms so that customers can run the software on their own equipment, just a massively scalable collection of commodity PCs running open source operating systems plus homegrown applications and utilities that no one outside the company ever gets to see.(O’Reilly 2005)

When people got used to free software and search engines, Netscape, however, cannot switch the operating mode quickly. So finally Netscape lost the market. It is universally acknowledged that to a company that makes a living by selling something, no market means no life.

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Global Initiatives Symposium in Taiwan 2009

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For most companies involved in a trend, they face similar problems that Netscape used to face, and they also have their own problems.

The first problem is that they do not know whether to follow a trend or not. There are a great number of reasons for this problem, but two of them are the most typical. One is external: sometimes they do not know whether the trend will last long. If the trend were just like a meteor and unfortunately they followed it, perhaps when the trend left, it might cause enormous meaningless losses to the company, or even more serious consequences. The otheris internal: sometimes their company cannot afford a wrong decision or even do not have the capacity to take action when a trend comes. And the leaders of those companies would rather choose to do nothing, and in this way it causes a vicious circle.

While the second problem is that they sometimes cannot act quickly enough to catch up with other competitors. There are also two typical reasons for this problem. The first reason is that the decision makers sometimes miss the opportunity to act in time, so the companies fallbehind in the trend competition. The second reason is that the companies themselves are not in good condition and they lack enough resources to develop new products or provide new service. In that case the companies are in positive situation.

So what can those companies do in the trend? Or how can they seize “the spring of hope”?

The answer is definite. Hope is not the pennies from heaven. Companies must adopt new business strategies to seize it.

For small companies, especially for those who have vulnerable funding chains and chaotic management, operation is often not as smooth as those big ones. The most importantthing for them is to become stronger. So their business strategies should base on cautiousdecision-making and meticulous management. When a trend comes, first of all, the decision makers must do their best to make wise decisions because they cannot afford making mistakes, and sometimes even making just one mistake is fatal. The second thing is that they must act more quickly than their competitors, especially those big ones, because they are at a disadvantage in the competition against them, and only by taking quick action can they occupy the market. Last but not least, they must make themselves unique to stand out from the competitors.

While for those big companies, who has strong funding chains and mature management, their operation is often much better. But that does not mean they don’t have problems. For example, they sometimes cannot act quickly enough when a trend comes, for some of their departments are overstaffing, and sometimes their decision-makers cannot change their cognition quickly. Besides, their employees from the grass roots may find it a bit hard to sharetheir ideas with the management layer. And it may cause serious problems when it happens during the waves of a new trend. So those companies should pay more attention to the aspectsabove. Their leaders should keep an eye on the global trends and strengthen their communication with the employees because they are often the first people to smell the trends.

Although for different kinds of companies, their business strategies may be quite different, however, there are still many mutual points that all of them should attach enough importance to.

First, companies ought to know what on earth they can capture in a new trend. That is aneffective approach to judge whether they should follow a new trend or not. Besides, they must

Find the Next Wave to Ride On - New Business Strategies in the Changing World

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analyze the prospective influence to the whole industries that they are in. Furthermore, they should form a quick estimate of what reactions their competitors will make, just as THE ART OF WAR by Sun Tzu says, “Know your enemy, know yourself.”

Second, they need to know how well their current capabilities will meet the new demandsof the trend. This is often the advance preparation to get ready for the trend. And this point plays a predominant role in the whole operation of the new strategies, for it determines the orientation of the company in the new trend. If a company makes an unrealistic orientation and tries to finish a job which is highly beyond its capability, it may exhaust its limited resources and finally fail in this new trend.

Third, they must get well prepared for a new way of operation. In a new trend, companies often have to change their quondam method of doing business. They have to develop new business lines or products, and that requires companies to operate in new ways which are different from those of their current business. Besides, what is more important is that they have to change their old way of thinking.

Fourth, they should correct the problem in their management whenever necessary, because only with effective management can a company mobilize the whole organization to seize every single opportunity in a new trend.

Last but not least, the products or service that companies provide should satisfy the market by all means, and that is what eventually counts in the competition of the new trend.Companies should analyze consumers’ psychology earnestly and estimate what the trend will develop into.

However, the points above are not the ultimate goal that a company should pursue.As we know, the only thing the world doesn’t change is that it is always changing. So a

company would rather lead the trend of the times than wait for a trend to come. It is a good way for a company to transform passivity into initiative. Companies should change not only with the world, sometimes but also before the world. Besides having the great insight of the industry that their companies are in, the leaders of the companies must also have the vigor and courage to create a new trend. What’s more, the companies should have the capabilities to abide by the consequence of failure.

Currently, the financial tsunami is ravaging the world’s business entities. Many companies are in the winter of despair. However, it’s also a significant phase of transition.New things will eventually replace old ones. That forces companies to adopt new business strategies to face the coming trends. No matter where the world is going, the companies that find new business strategies will finally seize the spring of hope.

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ReferenceO'Reilly, Tim. 2005. What Is Web 2.0--Design Patterns and Business Models for the Next Generation of Software. http:// www.oreillynet.com/ pub/ a/ oreilly/ tim/ news/ 2005/ 09/ 30/what-is-web-20.html?page=1.