In latest (Oct '99) Red Herring (not yet available on line) is an interesting article by Geoffrey Moore on "Failure," how and why so many high tech firms fail. While it is not on the intellectual level of Christensen's Innovators' Dilemma, it is interesting (and Moore has sufficient credentials of his own to be taken seriously on the subject, plus he's a good writer).
Of particular interest to investors in GSTRF is his third reason for failure: "The Tornado Dive." I quote: "And then, when [these companies] see it all coming together, they produce the tornado dive plan: to get first-mover advantage and win the tornado competition, we are going to launch the entire remainder fo the value chain in an all-out assault on the mass market." He then goes on to name three companies who in his view failed this way, 3DO, Go and IRIDIUM!
He says that all three pursued a strategy of "an all-or-nothing bet that everything will come together at exactly the right time. In every case, an unproven hardware platform and a whole new generation of software had to rollout without a hitch, and a whole new value chain to support it had to show up - all on day one, all ready to go. This is simply a crazy level of risk, a genuine failure mode..."
After reading this, I feel more confident in the wisdom of G*'s strategy of a "soft rollout." Also, I wonder if G* has Moore consulting them? |
