Overview

  • Most business strategies are backwards causality. X has success, and does A, B & C. If we, Y, do A, B & C, we will be successful.
  • Even if these factors are correct, Y is contextual (as is success), and generally overdetermined.

  • Companies lack situational awareness and therefore duplicating strategies from successful companies is ineffective.

  • Complete DAG of factors (or elements of the business) affecting value to a company.
  • Rank based on “value visibility”, i.e. the explicit, pubilc correlation between the factor’s value and how it’s percieved by customers.
  • Evolution of technology, has stages:
    1. Genesis
    2. Custom built/bespoke
    3. Product
    4. Commodity
  • Partition factors into their stages (e.g. electricity is a commodity, company’s app is genesis/bespoke).
  • Now we have a map of:
    • x-axis: technology timeline
    • y-axis : value visibility/customer value
  • And we have premises:
    • top-left: where to invest
    • bottom-right: Do not invest
    • Factors/elements move to the right over time (i.e. bespoke factors become standard products).
    • From the above point, top-left continues to be emptied, leading to new genesis opportunities.
  • That lead to the conclusion: We have a three part partition from top-left to bottom-right that informs how we should operate: build, buy, outsource.