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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Seeker of Truth who wrote (15910)	1/22/2000 5:33:00 AM
From: unclewest	Read Replies (4) \| Respond to of 54805

the Gorilla Game will be considerably less important 20 years from now. malcolm, i disagree. the gg book is recent...but the theory would have worked 50 years ago as well as it does now. imho the gg will be valid 50 years from now. human innovation is accelerating not slowing. we peons just can't visualize the new products yet. unclewest

To: Seeker of Truth who wrote (15910)	1/22/2000 9:19:00 AM
From: DownSouth	Respond to of 54805

I don't follow your logic, though I am sure it is sound. I can address the Andersen phenom a bit. Corporate America is in a tremendous rush to understand, select, and implement the best technologies--best being the ones that will take profits to the bottom line the fastest. Decision makers are deluged with technology vendors who make lofty claims about their niche and their particular solution. Once a solution is selected, it takes experienced people from many disciplines to implement these solutions. Usually the vendor cannot be relied upon to provide the implementation. Their too busy selling, they don't have enough people, and/or they are lousy project managers. Hiring the talent is out of the question. You can't find them, their expensive, etc. Part of implementation is almost always some level of customization and/or inter app interfacing (help desk to maintenance system to financials to HR, etc). That takes yet another set of unique talents. So, Andersen and others are being hired to help with 1) need analysis; 2) business process re-engineering; 3) solution selection; 4) project management; 5) system integration. My conclusion is that the success of Andersen and a host of other small, medium, and large consulting firms is a result of the demand for these consulting skills. It is independent of architectures being deployed, unique or not. It is dependant on the level of demand for implementations of those technologies. If the rate of implementation subsides, the success of the consulting companies diminishes. BTW, the real threat to these consulting companies are the application hosting providers. These companies have the solutions already running and interfaced with one another on suitable hardware/software platforms. The process of implementing a client firm is much simpler. It involves primarily data gathering/conversion and end-user training. One more point, the margins commanded by the product providers are far higher than those of the consulting firms.

To: Seeker of Truth who wrote (15910)	1/22/2000 9:52:00 AM
From: Mike Buckley	Respond to of 54805

Malcolm, Another good point you make. That was a question and my own answer is yes, the Gorilla Game will be considerably less important 20 years from now. I agree with you if the product makers depend on thriving on one tornado. I disagree with you if business models more often depend on (create?) successive tornados in the same field as Cisco has done or if they depend on various tornados in different product categories as Microsoft has done. In both cases in which I disagree with you, as profuct lives shorten, it is likely that the successful companies will be those that make substantial investments in other companies as both Cisco and Microsoft has done. In summary, because I believe the businesses built on tornados in different product categories will prevail, I do believe Gorilla Gaming will be every bit as important 20 years from now as it is today. I look forward to checking in with you then to see who was right. :) --Mike Buckley

To: Seeker of Truth who wrote (15910)	1/22/2000 7:46:00 PM
From: mtnlady	Read Replies (3) \| Respond to of 54805

Malcolm you touch on a subject that I have been pondering deeply myself of late. That is "as the pace of the technological advance increases, will not the unique architectures have shorter and shorter lives?" To paraphrase.. in short the tornados become closer and closer together and a technologies life span becomes shorter and shorter. Thus the life of the gorilla will become shorter and shorter. Unless (!) they use their huge gorilla advantages (size, wealth, market acceptance, customer/supplier relationships etc..) to their distinct advantage. But it's not easy for a huge company to change technologies mid stream. We gain some insight into this turmoil through the ongoing EMC vs. NTAP discussion on this board. What made the company the huge/dominate gorilla or king will be the very same culture (both co., value chain and customer) that will cause massive friction to any radical change. What does this imply? One.. that we can expect the pace of tornadoes to increase while the time between technological changes to decrease. Industries can expect one tornado to supplant another - very, very quickly. Two.. unless corporations get VERY adept of changing their culture (i.e. blow it up and start anew while retain their supply chain and customers).. that the LIFE OF A GORILLA WILL BECOME SHORTER AND SHORTER! This short life span is exasperated by ... Three.. Moore mentioned it.. Greenspan mentioned it.. but the flow of wealth to the 'winning technology' - not company (i.e. post tornado) - but technology (i.e. early/mid tornado) is happening now at a speed that is mind boggling. I.E. The tornados are fast and vicious when it comes to sucking money from the 'losers' and passing it to the 'winners'. Of course the internet and the way information is so freely and quickly passed now (the very reason the internet was originally developed of course!), and online investing have amplified this to levels never seen before. We can expect this trend to speed up even more as the net becomes faster, more organized (easier to find info and more info is published) and prevalent in our society. Four.. from watching patterns of companies it is becoming apparent to me that the most radical wealth increases occur DURING THE TORNADO PHASE. Someone mentioned here 100-300% increases are the 'norm' during a tornado. WE DO NOT SEE SUCH RETURNS FROM A GORILLA. Slow, steady, strong growth.. but not 100-300% returns. Side note: These tornados after tornados are what is/and has DRIVEN THE STOCK MARKET to such radical heights these past 10+ years. When the tornados slow down so will the Naz. CONCLUSION: Gorillas will die much quicker deaths than in the past. Tornado affects will be even stronger than the present 100-300% returns we now see (because money will shift out of the 'old' and into the 'new' much faster). We need to start identifying (and yes INVESTING) sooner into the tornado. I think CRM is a good example. If one were to wait several quarters for clear, beyond a doubt, confirmation as to who the 'winner' was in the CRM sector. I guarantee that the next tornado would already be upon us and your newly identified gorilla could already be loosing her grasp! I find that these observations have already radically altered my investment style and my stock holding patterns. Some would argue that this isn't a gorilla and king philosophy but I would disagree in that the same tools (half empirical/half art form) that are used to identify these beasts are the same ones that are critical for 'working the tornado' and quickly consolidating your basket down to the most likely winner. By the way.. my other 'interesting' observation is that #2 in the market usually does pretty good too. All of my #2 companies that I've held have been bought out by someone else at a pretty penny. So owning #2 sometimes has been as lucrative as holding #1! That thought is comforting when trying to identify the winner so early and focusing $$$ their direction. I know these thoughts are probably heresy for this board.. so be it.. might as well add some wood to a good discussion!