Keys to New Product Success(Part-4)- Transformation with strategic partnerships

SWOT analysis has been an important tool, managers & business executives are using to assess new product opportunities. Proponents of this theory argue that parameters internal to organization & external to organization (viz market & competitive scenarios etc) overall help determine the attractiveness of an opportunity. Strengths & weakness are analyzed based on organizational competencies, understanding of customer needs & insights, resources, systems & processes, technology IPs, channels etc in the context of opportunity. The opportunities are evaluated based on market context, macro trends, built in inefficiencies, emergence of critical mass for certain solutions etc.

Though SWOT framework was sufficient for the industry of 20th century, they are not sufficient to fast moving, technology driven industries of 21st century.

Let us ask this question to all organizations ” Will you be satisfied with where your internal strengths can take you to or what articulated opportunities can fetch you?” Little introspection here tells that answer is “No”. Now, the winner is the one who exerts greater control over his destiny, far more than his internal strengths and what current opportunity can offer. They create opportunities & solve in a way that is far superior than their internal capabilities.

Transformation with strategic partnerships: The way to go about is to transform organizational capabilities and effectiveness to much higher level than their strengths & opportunities by forging strategic partnerships. I can’t imagine  a better industry than semiconductor, where companies are transformed their market effectiveness to much higher level than their offerings. These companies compete with each other & at the same time, partner for creating value added products.

For example, ARM has been promoting their microchip as standard & is licensing their core to number of semiconductor companies. Other companies, particularly fabless design houses, build their own differentiated technology on top of ARM core, to offer more successful products. This effective collaboration has helped many smaller design houses to offer much effective products. It helps companies to innovate along their core competencies & at the same time collaborate for more compelling value proposition to customers.

These partnerships are extended to all aspects of value chain. The challenge is to see the synergy in value creation. This can be

• to offer superior product or solution.
• increase measurable customer benefits.
• Reduce costs by ex. supply chain optimization, channel optimization etc.
• Decrease total cost of ownership.
• Increase customer reach or acceptability

Overall, strategic partnerships have potential to transform organizations by creating opportunities that is normally not there and solving them in a way that is normally not possible by conventional organizational limits.