Archive for September, 2009

Selling Risk Management

29.09.2009 No comments

Definition of Experience:  A rich history of the many horrible mistakes one never wants to repeatRisk

I touched on this subject in “Lawyer Rant No. 1” — Get paid for the risks you know you are better able to manage or at least are perceived to be better able to manage.  Let’s break this down a bit more and see what insights it brings.

In a market-based economy we sell products and services to willing buyers.  These could be as simple as an apple by a street vendor or as complex as an enterprise-wide information system.  But in its elemental form, I suggest that you can only sell a combination of five basic things:

  1. Raw materials such as iron and oil mineral rights
  2. Labor
  3. Expertise as in intellectual property and knowledge transfer
  4. Economies of scale
  5. Management of risk.

The first three are obvious and the fourth, as it applies to the first three, is also obvious.  Let’s consider the last two in their pure forms. Read more…

Drilling for Oil

06.09.2009 No comments

Services vs Product Business ModelsWest Texas Pumpjack

It always struck me that there are very few companies that are equally as strong in products as they are in services. This is in sharp contrast to the number of companies that have moved from their core to embrace the other side.  Companies like Cap Gemini quickly abandoned the idea of becoming a product company and we see HP struggle with services by now trying to jump start it through the acquisition of EDS. IBM might be held as a contra-example with both products and services, but I would submit that they have switched from being a product company to the current service company that they are today (e.g., selling the laptop division to Lenovo and printer division to Lexmark)

Read more…