Cannibalize Thyself
Microsoft was a
very successful one-trick pony (Windows/Office) for decades. But being a
one-trick pony is exactly what every big tech company today seeks to avoid!
If you thought
this just meant having multiple products/brands (a la P&G), think again. Tech companies today almost think
cannibalistically! Steve Jobs, in fact, explicitly said just that:
“If you don't cannibalize yourself,
someone else will.”
That mindset was
exactly why Apple launched the iPhone even though it would cannibalize their
iPods; and why they launched the iPad even though it would cannibalize their
Macs.
Facebook has its
Little Red Book whose mantra is:
“If we don't create the thing that kills
Facebook, someone else will.”
Amazon operates
the same way, says
Arjun Sethi:
“Consider the Kindle: a device that
became home to the world’s biggest bookstore, and lured people away from buying
physical books. If Amazon didn't do it, someone else would have.”
Google has
always tried to avoid being that one-trick pony by moving beyond just search:
they succeeded in some areas like maps, mail, apps, YouTube and Android. But
the Apple/Amazon/Facebook approach of constant innovation gets tougher as a
company becomes bigger. While Wall Street is all about “Too big to fail”, in
Silicon Valley the saying is “Too big to innovate”!
Google’s recent
reorganization into a new parent company called Alphabet is designed to address
the “Too big to innovate” problem:
1) Everything that is established stays
under the Google name;
2) All their moonshots, aka future
possibilities, like self-driving cars and Nest fall under Alphabet.
Sundar Pichai
was made the boss of the established parts of Google. While Google’s founders
will run the future possibilities division.
Why the name
Alphabet? Founder Larry Page explains:
“We liked the name Alphabet because it
means a collection of letters that represent language, one of humanity’s most
important innovations, and is the core of how we index with Google search! We
also like that it means alpha‑bet (Alpha is investment return above benchmark),
which we strive for!”
So, instead of inventing a wholly new name like 'Google', they have settled to the centuries old and familiar 'Alphabet'. Anyway, "what is a name; rose under any other name smells as sweet", as Shakespeare said in order to come up with yet another quote of his. :-)
ReplyDeleteOne reason Google succeeded remarkably well in living on cheerfully, while trying to 'cannibalize' itself is that its business is software development. They have little of hardware marketing to worry about. (Don't ask, "Why then Microsoft being also software people did not live up to that kind of thing?" You have yourself given the answer to it. Domain, I agree, is only one part of the story.) The point I am making is: software requires less of dumping problem, unlike hardware production facilities (say cars, aircraft) who have to change their machinery in order to come up with a different production line. Software is closer to a mind-space, and is less physical, even after granting its ground is still hardware.
Why I said that is because, decades before this kind of motto in catchy terms of contradiction (!) "cannibalize yourself; and you will live" was taken up with full zest by many others, a hardware (at the core-most level) company just did that. Intel development teams were pushed to render their own products obsolete in the shortest possible time. We don't give as much thought to the processor as we do to the software that runs on it. Isn't it marvelous that the nano chips more than coped with the explosive trend of the software? Often the chips actually encouraged the software guys to think even bigger!