By Samuel Quek
SINGAPORE, 7 June 2000 - The already volatile telecommunications industry is expected to undergo even bigger changes, said Dr. David Dean, vice-president of The Boston Consulting Group's Germany office.
Dr. Dean was one of the speakers at the eBiz 2000 summit, held as part of Communicasia 2000, and spoke in brief about the new emerging strategies and paradigms in the New Economy.
Two basic business models can be seen, said Dean, labeling them the Attacker and the Defender paradigms.
Who they are
The Attacker tends to leverage new technology on a focused business model. The Attacker's staff tend to be willing to take more risks, and the such companies tend to have a flat organizational structure. The Attacker has nothing to lose, and everything to gain.
The Defender, on the other hand, is typically more established, with numerous businesses. Branding and customer relationships are also more established, which are often the leverage point for most Defenders. Defenders tend to be more risk-adverse, having more to lose. Due to the organizational structure, Defenders also tend to be sluggish and less flexible.
The key, said Dean, is for companies to learn to think and act as both attackers and defenders in an alternating pattern.
The Attacker strategy should consists of several steps:
1. Identify an opening - driving a wedge
2. Keep driving (through rapid innovation or products of services)
3. Claim boundless opportunity
4. Focus obsessively on growth
5. Prepare to Defend
Attackers tend to orientate towards customer needs, and have a rapid rollout date.
Defenders have some strategy too:
1. Buy time (some by suing their competition)
2. Fortify position (buying companies to cover their weak points)
3. Display no sentimentality (cannibalize parts of themselves to strengthen others)
4. Re-orient to Attack mode
Defenders need to learn to re-orient to focus around their customers rather than around their products, said Dean.
Not one, but both
To concentrate completely on attack or defense alone is not a viable option, said Dean, illustrating how companies should adopt both strategies in an alternating pattern.
"Attack and defense are two aspects of one single strategy," said Dean, "The symbiosis of attack and defense comes from intertwining both strategies, one after another."
Dean pointed out to several examples, including America Online constantly re-inventing itself to remain a market leader.
Businesses need to be ready, said Dean. He advises them to segment their business portfolios on the basis of attack/defense, and to position their ongoing businesses in the attack/defense cycle.
"The [Singapore] government needs to see how companies need to go out of the country to attack," said Dean, in relation to how the government can help the telecom industry in Singapore. "Losing share is natural, but [the companies] should take that chance to maintain profitability, or increase productivity."