On Apple, Google, Tesla and asymmetric competition: an interview with Horace Dediu

Horace Dediu (Horace Dediu) - an independent analyst Apple and IT -industry as a whole, the founder of asymco.com - one of the most inspiring research experiments in the field of IT, a leading Asymconf - version Asymco, broadcast live, and it is widely known in the world, and co-host of the podcast The Critical Path .

Analytical reports Horace, which he published in his blog on asymco.com, received public recognition (magazine Fortune even called him the king of analysts Apple), and Horace himself known among other things for his performances on the Bloomberg TV , articles for Business Insider and Harvard Business Review . Horace is also the creator of Asymcar , another experiment on the application of the theory of "disruptive" innovation and the concept of jobs-to-be-done in the automotive industry.

About a year ago I had the opportunity to meet with Horace himself, and not so long ago, he agreed to give me an interview in which he talked about his projects, plans, relation to the accumulation and dissemination of information in the modern world and the theory of "asymmetric competition" for example, Google, Apple and Tesla. i>

So, Horace, I would start with your biography, although some of the key facts it is easy to learn from the materials that are in your articles on asymco.com, as well as from guest appearances, like intervyu , which you gave to Dan Benjamin (Dan Benjamin) for the podcast The Pipeline in 2011. I'm interested, because I'm trying to understand your history and motivation, thinking, everything that has affected the way you lead and guide the ongoing projects. As far as I know, you come from a family that was involved in science, engineering specialty received in the States, he worked in the research laboratory and in the environment of startups, then spent eight years analyst at Nokia. Can you tell us about how it was formed is your approach to research and theory of business for years prior to the base of the three projects: Asymco, Asymconf and Asymcar? B>

Yes, there it is - my story includes a really long work in technology, and then in business analysis as an analyst in the company Nokia, but the main passion that accompanied me the first 20 years of my career, remained technology so I have worked in both areas - in research laboratories and in the field of information technology in New York, as well as in the bank; I worked at a startup, in fact, even in the two startup that develops software. I'm quite late in the 90th or so, took up this challenge - tried to explain the mechanisms of business. I think my unique ... well, maybe not very unique, but still a contribution is to talk about the business from a technological point of view - is, in some way, an unusual combination.

Horace speaks not only about the business from a technological point of view - at their conference Asymconf he uses just three of the screen to show the audience visualize their findings i>

It seems that this is the approach you have used for many years, trying to explore the fullest each test direction, for example, the theme of Apple, which is interesting to me personally. With this approach, you need to have a share of fearlessness and think carefully to understand how to work with the concept of asymmetry [in business]. Please tell us more about the concept of asymmetry, which you're trying to convey to their readers and followers. B>

Yes, that's right. So perhaps the main question that I was trying to answer is this: why some companies are successful and others - no. To date, according to the conventional theory, the success or failure in business is directly dependent on the method of administration, which has been thought good or not. The problem is that the company can be successful for quite a long time, and then be unsuccessful without change management strategies. How does the management of good turns to bad - that's just what question to be answered.

All the company pass through the stage ... hunger, so to speak, and then comes the stage of saturation. When they are hungry - they are more successful, but with the onset of saturation, they begin to make mistakes. Blockquote> So, the question arises about other explanations [successes and failures of the business], for example, "the company may just be lucky or unlucky." Unfortunately, it is not very reliable theory, but simply a matter of chance, so we'll have to look for a more reasoned hypothesis. Theories that have been developed on the basis of the work of Clayton Christensen (Clay Christensen), boil down to the fact that in the development of their role and psychology, psychology of her leadership. However, all of the company pass through the stage ... hunger, so to speak, and then comes the stage of saturation. When they are hungry - they are more successful, but with the onset of saturation, they begin to make mistakes. The reason for these changes is not so simple.

According to the theory of asymmetry, "hungry" companies have an advantage over competing companies who have reached saturation. This is something that was embedded in a cultural code of our society for hundreds, if not thousands of years ago. Each of us is faced with similar preachy stories, even in the Bible, you can read about the history and success of the asymmetry, the roots of which lie in the discrepancy of the weak and strong. I think this is the real reason for the failure of influential companies that possess all the resources and still lose to companies that have very little resources. When you start to think about it, the next step is thinking about what is causing the decline or disappearance of large corporations, but also opens the way for the industry to new firms, which are actually a positive force - they cause change, they create a so-called "breakthrough" that all drives. Actually, the presence of such a mechanism in the business of birth and rebirth demonstrate progress, and in those branches of business or institution where such "option revival" is absent, the level of progress is very low.

Yes, I think so. I found it interesting to your statement about the "medieval" state of the economy, I mean your cue from the interview to The Pipeline - you said that when business is not ready to apply the theory in the technology business, it can be called almost medieval way of thinking. B>

Yeah, right - in the "medieval" state for a long time to find everything that we call business, commerce and other activities to generate revenues ... [In respect of what happened afterwards] I do not want to use the word "capitalism," which is often used in this case, it's not quite what I mean. Nevertheless, the organization tool commercial issues has changed dramatically and took the view that we are seeing now is probably less than two hundred years ago, and in some places and less than one hundred years ago. This mechanism, but rather a way of organizing its structure today is a function of the industrial revolution. Before the industrial revolution, until about 1820, way of doing business in Britain was built around the skills of individuals, was based on privacy and scientific approaches are not used. Shift, followed by businessmen began to hire engineers and scientists, allowed the industrial revolution changed everything.

The modern business management training - not science. There is no theory that can be applied using a scientific approach - this is still the area of ​​the discharge mysteries. Blockquote> So, curious to see to it, as the scientific method helped change some aspects of our world. However, management in the technology business is still largely based on confidentiality and maintaining power, and it means that we do not know a lot about how to run a business. This is - an unscientific approach to management. Yes, there is some knowledge that is trying to convey, but what is taught in business schools, is hopelessly out of date - is like an artisan learning to use the tool, without explaining how to do a good thing or another useful tool. In teaching business management there is a gap, as it is not a science, because there is no theory that can be applied using a scientific approach - this is still the area of ​​the discharge mysteries. Some are surprised that we do not use a scientific approach to a better understanding of why companies come to success or fail - that's a gap that researchers are trying to fill today.

I think the key point, or perhaps one of the key points here is asymmetric information and knowledge sharing. Do not you think that we are entering an era of revival of business with partially open sources of information, when the asymmetry is needed to create ecosystems and, if possible, of dominance over them? B>

Yes, it's interesting. I think that in fact this is what lies at the heart of business theory Google. I believe that Google is trying to use a more scientific approach - of course, not yet within the spread of information stored inside - in fact they share quite a small part of their knowledge, but try to approach systematically to carry out their operations, namely, to develop ideas to the development of products to receive data ... maybe to the determination of their future actions. This development process is an attempt to use a scientific approach. And it is much better than what happened before or happens so far in any other place where a decision on further action is reduced, say, to the skills and vision of individuals, their instincts. There are some data which influence the decisions of individuals, but in a big corporation is, in fact, a normal distribution of resources, which is still mainly directed downwards.

At Google, which probably tried to allow information to climb from the bottom up to allow all to a greater degree of influence on decision-making. The result was that now they create a lot of products that run as sources for data collection, and then collect information and then ... either stop working, or continue to develop the project. Such a process is run many products and their "experimental" use is a real thorough scientific process. We can observe its elements. Perhaps in Google is going to change the process. Perhaps, this approach did not work as they had hoped - we can not know for sure. Nevertheless, there is a problem in the market for a more scientific approach. Although there is still an element of personal taste, subjective vision of how management should look like - not everyone can be transferred using the data.

So the experiment continues, we will see how Google will continue to work with him. Since this process in some way, is mutual learning, it still has not worked out properly. I think that the experimental study of Asymco is this: I want to see if we can get from a small group of companies sharing enough information. Emphasis will be given to companies I have in the IT sector. We also want to know if we can get them enough information to generate discussion on this topic, and then learn from them sufficiently to improve the way business of other companies - that's what is my experiment.

Yes, I understand, but I think that in fact we can not expect from such companies frank about the secrets of their management processes and other scientific mysteries. But I'm sure we've seen something similar to the concept of asymmetry, when, for example, Apple iTunes and economy have created App Store, providing the market relatively inexpensive or even free tool for creating and disseminating development of others. This is slightly different from what is happening, for example, in the company of Tesla, which opens access to its patents, although some analysts still regard this step as an act of charity, and do not see here asymmetry. B>

Of course, I did not expect from a company that they will take, and will tell exactly how they make their money. This analysts need to take the initiative in their own hands and monitor such experiments, to publish their observations. You see, analysts are watching companies, but leave all the observations with you to share them only with their clients. This is the business model of business analysis. The idea is this: if I made a forecast of the company, then I will not share them, I'm selling it. The problem is that such an analytical picture is not tested by the public, the reaction was verified by fellow experts and so on, even a third party, not the company itself, as an independent entity, conducting analysis, no shares her methods, assumptions, no one explains how undertook certain conclusions.

So, if you are treated to the business, as a phenomenon, which is being watched, I hasten to disappoint you - modern analysts cherish information and observations, as a very important secrets. It's as if Galileo observed the planets, and the results of their observations only sell to someone who offered the highest price. Then his discoveries would know only five people, knowledge would not spread, and we would not know about his studies. The same applies to all of Newton and his followers. Business analysis to date insufficiently open. I hope to change the analyst's work - and it must be changed! - From the person who collects or keeps them to himself, the analyst must be those who actively shares information and seeks to obtain feedback on this information. Here's what should happen.

To some extent this has already been done by scientists, but scientists still expect to gain access to internal data and achieve friendly relations companies to themselves. My approach is to use only those sources that are in the public domain and try to provoke discussion, a broad discussion. We can talk a long time about the difficulties faced by scientists and researchers of business - let's focus on what we call it a hybrid approach: half scientific, half business.

I think that the chances of success are limited Tesla. In the process of production Tesla has not made any innovative solutions - they are exactly replicate what they do all around. Blockquote> We mentioned iTunes and company Apple - in its behavior is an element of innovation. Tesla also makes its contribution to innovation, not much caring about preserving the intellectual property, but this is an experiment. iTunes proved successful project, see whether the success of the company accompanied by Tesla: I think her chances of "take off" is limited. For Tesla issue of intellectual property is of little interest, as in the automotive industry, it is not very much appreciated. Those few knowledge that have been obtained automobile companies, kept secret or patented, patent-trade is rare in this industry does not create patent pools and spent not a lot of litigation. Yes, it was - but only over a hundred years ago, not now, as the industry has finally formed.

The most important innovation in the automotive industry, which turned it into what we have now dealt with the manufacturing process, mass production and production on a large scale. The founders of innovative changes in these areas were Henry Ford and then General Motors, which developed methods customization or annual changes of the production process, allowing to change the model. Later, Toyota has developed a system of "just in time": we can say that the industry has gone through three phases of innovation.

The company Tesla has not brought in any process of innovation. At least in respect of production, they are exactly replicate what they do all around. So their innovative solutions in matters of transmission systems design technologies charging electric batteries are technical innovations, but ... I'm not sure that anyone else in the industry is interested in these particular solutions, so that a broad discussion of patents in this area can not be.



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