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Industry Analysis for Dow Corning

Industry Analysis for Dow Corning. Assess the dynamics of competition facing Dow Corning in the silicon business prior to the launch of Xiameter . How attractive is the industry? (hint: use Porter’s 5 forces) Would you advise a potential new entrant to try and enter the industry.

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Industry Analysis for Dow Corning

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  1. Industry Analysis for Dow Corning • Assess the dynamics of competition facing Dow Corning in the silicon business prior to the launch of Xiameter. How attractive is the industry? (hint: use Porter’s 5 forces) • Would you advise a potential new entrant to try and enter the industry

  2. Nelson Phillips Professor of Strategy and Organizational Behaviour Value Innovation

  3. Ways to Elaborate a Business

  4. The Role of Value Innovation Strategic Thinking is Competing by staying ahead of the competition. Making competitors irrelevant through value innovation. OR

  5. Pitfalls of Traditional Approach to Strategy • Focuses on competitors not customers • Focuses on incremental improvements to products and services • Leads to product/service feature proliferation • Increasingly similar offerings across the sector

  6. Traditional View Industry conditions are set and given. Value Innovator Industry conditions can be challenged. Industry Assumptions

  7. Traditional View A company should build competitive advantage Value Innovator Competition is not the benchmark. A company should pursue a quantum leap in value to dominate the market. Strategic Focus

  8. Traditional View A company should retain and expand its customer base through further segmentation and customization. It should focus on the differences in what customers value. Value Innovator A value innovator targets a mass of buyers and willingly lets some existing customers go. It focuses on the key commonalities in what customers value. Customers

  9. Traditional View A company should leverage its existing assets and capabilities. Value Innovator A company must not be constrained by what it already has. It must ask, what would we do if we were starting anew? Assets and Capabilities

  10. Traditional View An industry’s traditional boundaries determine the products and services a company offers. The goal is to maximize the value of those offerings. Value Innovator A value innovator thinks in terms of the total solution customers seek, even if that takes the company beyond its industry’s traditional offerings. Product and Service Offering

  11. A Value Curve

  12. A Good Value Curve • Is focused • Shows divergence from other industry players • Is simple • “The speed of a plane at the price of a car – whenever you need it”

  13. Four Questions for Producing a New Value Curve • Which of the factors that our industry takes for granted should be eliminated? • Which should be reduced well below the industry standard? • Which should be raised well above the industry standard? • Which can be created that the industry has never offered?

  14. Exercise Draw a value curve forXiameter based on the concepts we have been discussing: • What are the most important factors of competition in the silicon industry? • Draw value curves forXiameter and its competitors • What are the key changes in the business model that underpinned Xiameter’s success • Be prepared to discuss with the group.

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