Murray Slides

Murray Slides

• 1.
  Technology Strategy forStart-Ups Professor Fiona Murray Sloan School of Management E52-551 fmurray@mit.edu
• 2.
  Technologies Markets Howwill we create value? Can we capture this value despite competition? Do we have the organizational capabilities necessary to deliver it? Foundations of Technology Strategy
• 3.
  Do all scientificideas have economic potential? Potential Economic Value of idea Value of Scientific idea Not Very Useful -Can’t Implement -Cost / Processes -Social Constraints -No “Market” X X X X X X
• 4.
  Is it thecase that great ideas = pots of money? Economic value captured by the startup Economic value potential created Betamax VHS Philips Xerox Parc Competition Standards Managerial Oversight & Investors Licensing Strategy X EMI- CT Scanner GE-CT Scanner X X Microsoft
• 5.
  Two main areasof technology strategy Value creation Does this technology or scientific idea create something of value for customers? Value capture Can we capture the economic value inherent in this idea in the face of competition?
• 6.
  What is abusiness model? Business model = How do you plan to make money? Way you decide to transform your scientific ideas into economic value
• 7.
  The Business ModelMediates Between the Technical and Economic Domains Business Model: ¥ market ¥ value proposition ¥ value chain ¥ cost and profit ¥ value network ¥ competitive strategy Technical Inputs: e.g. feasibility, performance Economic Outputs: e.g. value, price, profit Measured in technical domain Measured in social domain
• 8.
  Value Creation Whatis your value proposition? What does this idea do for a group of customers? Valuable attributes belong to products not technologies Technology Product/ solution Market
• 9.
  Many technologies canbe used in different ways …. Which customers are most willing to pay? Where is this the most significant improvement? Which applications are the most technology do-able? Which applications are on the path to progress? Technology e.g. e-Ink Product/solution Product/solution Product/solution e.g. Signage e.g. eNews e.g. eBooks
• 10.
  Value Capture Canwe protect our competitive advantage (value proposition)? How will we deliver value to customers? What protective layer can we wrap around our technology, product & customers? Technology Product/ solution Market
• 11.
  Four key ideasfor start-ups: Intellectual property Controlling the knowledge underlying an innovation Secrecy No-on else knows how to do this Speed Moving rapidly beyond current competition & keeping ahead Lock-in customers Making it costly for customers to switch or becoming the standard
• 12.
  Many ways todeliver value to customers … Product or service? How far along the value chain? Interaction with competitive advantage & protection Technology e.g. combo-chem Product Service Drug discovery e.g. Library h’ware & s’ware e.g. Library service e.g. Pharmaco firm
• 13.
  Evolution of yourtechnology strategy: example of Millennium Build Revenue: Apply technology to different problems thru service contracts and maintain IPR Build Assets: Use alliances to develop key assets & new technologies Firm founding: Based on narrowly defined gene technology Forward Integrate: Move down the value chain internally & thru acquisitions
• 14.
  Key Questions thatMUST be addressed Does this idea create economic value? What is the value proposition of the product? What is the market segment? Can we capture this economic value? Can we protect our competitive advantage Where in the value chain are we focused – how do we deliver the value?