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[CDPS] G2 - (PR) Chapter10 - Strategy Member: Sunny / Cindy / M.J /…

- - - - The bargaining power of suppliers
      - The threat of substitute products or services
      - The threat of new entrants to the market
        
        Affect the strategy position
      - The bargaining power of customers
      - Evanescent advantage
        
        Flexibility :check:
        
        Ownership of infrastructure :green_cross:
        
        The competition are more complicated and dynamic than Porter's model
    - - Control these five forces
    - - Avoid ruinous competition
      - Encourage to compete in value chain
    - - Purpose on avoiding competition
  - - - The era of scientific and technological progress
- - - - Competition between platform and its partners
      - It can strengthen platform but weaken partners
      - Short-term gain may lead to loss in long-term
    - - Competition between unrelated platform partners within the platform ecosystem
    - - Strategic advantage
        
        Attractiveness of particular products/services :green_cross:
        
        Power of entire ecosystems :check:
      - Competition between platforms
  - - - Increase valuable interaction on platforms
      - Blurring boundaries among market participants
      - Considering buyers and suppliers to be partners for value creation
      - Encourage participants playing multiple roles
    - - Access to customer-producer network and interaction results is more critical
      - Platform without physical assets grow faster
      - Accessible assets to platform grow faster than itself
- - - - pursue targets
        
        add complementary products
        
        market access
        
        subtract supply chain cost
    - - Before M&A
        
        Observe the transaction of partners
        
        Running experiment to test strategic scenarios
        
        Considering overlap of users that currently serving
      - Reducing risks
        
        Pursue fewer acquisitions than traditional firms
        
        Less assets needed
      - Reduce technological complexity
        
        keeping partners at arm's length
        
        Vertical integration faces technical and strategic challenges
        
        Avoid developing platforms by multiple independent technologies
        
        Better customer experience
        
        Easy to replace in modular design
        
        Reducing costs
  - - - New feature
        
        Competitive threat
        
        Multi home
        
        Abandon
      - Envelopment Battle
        
        Platform A envelope B by developing a feature
        
        Platform B envelope A by the same attack
        
        Winner (more initial user base & powerful network effects)
        
        NO victory is permanent :warning:
        
        must be vigilant in guarding against complacency
      - Serve similar or overlapping user bases
    - - Occurs when one platform absorbs the functions and user base of an adjacent platform
        
        Apple
        
        iphone platform
        
        envelop the markets
        
        mobile payment systems
        
        wearable technology
        
        Haier Group
        
        expanding its appliance platform
        
        for: connected home applications
  - - - Tactically
        
        A/B testing
      - Strategically
        
        Analysis competitors information
    - - Help clients find suitable partners
      - Using unsuccessful users searches to find potential clients
  - - - Baidu
      - Facebook
      - Microsoft
    - - First appearance far down the long tail
        
        They may build the new platforms
        
        Acquisition
        
        :check:Facebook & Instagram
        
        Weaken the startup platform
        
        :red_cross:Facebook & Zynga
  - - - Create
        
        higher-quality products & services
    - - Facilitate
        
        interactions
      - the quality of Tools
      - producers with consumers
    - - superior platform design :star:
        
        out compete a preexisting rival
      - did much better at
  - - - Avoid users switching the platform
    - - Apple declined Adobe Flash player
        
        Design their own application- iTunes
        
        Maintain iPhone distinctiveness
      - Alibaba
        
        Create technological barriers
        
        Prevent Baidu from searching their website
        
        Make sure shoppers only put ads at their platform
        
        Gain more revenue :tada:
- - - - The Internet-era source of market power
      - Created value & the profit margins increased due to more users in ecosystem
      - Positive Network Effects
    - - Multi homing
        
        Monetary
        
        Inconvenience to upload data
      - Switching
        
        Costs when one leave one platform and move to another
        
        Monetary and Non-monetary
      - Both
        
        Push a market toward higher concentration- high
        
        Apple or Android
        
        late entrants gain market share - low :
        
        Facebook & LinkedIn
    - - users' tastes
      - Windows, Apple, LinkedIn
      - The greater the forces, the more aggressive the platform competition becomes
      - Uber and Lyft
    - - An industrial source of market power by production costs
      - Volume matters
      - Railroads, pharmaceutical development, auto & aircraft manufacture,etc.