Product Strategy for High Technology Companies

By looking at your vision as inclusive and exclusive of certain conditions that you either impose (internal facing) or accept (external facing), you can align your strategies with the realities of your company’s “condition” at any given time.

Robert Sterns, who was chief strategist at Compaq until he left in 1998, saw the Digital acquisition as a mistake. “In his [Pfeiffer’s] quest for bigness, he lost an understanding of the customer, and built what I call empty market share—large but not profitable.”

In many ways Digital was like a frog in gradually boiling water. If you drop a frog into already boiling water, it will jump right out, but if you put the frog into cool water and then start to boil it, the frog will not notice that the water is heating up until it is too late. One of the likely reasons that Digital did not change its strategy in t

“If only…” is a tough pill for many Digital alumni to swallow. Here is what a winning vision might have looked like in the early 1990s with the benefit of hindsight: Digital recognizes the profound changes in its industry and the need to change strategic direction. Accordingly, we will migrate all our computer systems, microprocessor technology, an

To an outside observer, it appeared that Digital was desperately trying to find anything at all that might work. With the depth of its technical skills and some of these early innovations, Digital had an opportunity to be an early leader in the networking marketplace and could have rivaled companies such as Cisco, if only it had stepped back and re

Try to find a way to maintain revenue and find something for all of these employees to do, in any way at any cost. Invest R&D in anything that is interesting and keep investing in operating systems, computer systems, and microprocessor technology even if the future for them is questionable.

Digital also had some exciting computer technology, but it couldn’t exploit it effectively without a vision. With the 64-bit Alpha system, Digital had the fastest microprocessors and computer systems on the market. Alpha workstations set a new standard for price/performance, in fact. But Digital did not have a vision that could be achieved by this

The CSV Boundary Framework The CSV Boundary Framework has two very important purposes. First, it makes sure the strategic vision is achievable. A good CSV may be aggressive and it may be a stretch to accomplish, but it shouldn’t be impossible or even unrealistic. A realistic CSV is aligned with the company’s strategies, as well as the outside world

This is what a core strategic vision is all about—making sure you think about where you want to go.

Interestingly, Dell Computer continued to follow successfully a vision that was essentially the same as Compaq’s 1992 vision. Dell continued to excel in the PC market by providing low-priced PCs; however, Dell was able to reduce its cost structure even more than Compaq by using the Internet to take customer orders and configure them on the producti