Another dot-com bubble?

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Back in 1999 I got booed for saying the dot-com boom was mostly hot air, after which the NASDAQ dropped from 1000 to 200. The Economist now warns of a 2nd bubble,with private equity and big corporates falling over each other to throw cash at anything web-ish. Many of the new ventures will be great, but most will fail, due to poor understanding of whether business models are viable – which needs a sound system-model of the business.
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German secret of success

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Fascinating Economist article on two recent studies of Germany’s outstanding long-run success. It’s down to their ‘Mittelstand’ mid-sized companies relentless pursuit of apparently boring but lucrative niches, and similar strategies by their larger, but little-known firms. More detail on their strategies in the article and references. Others tell me this is backed up by very strong involvement from bank-investors, rather than disinterested arms-length investors nagged by foolish analysts chasing every quarterly forecast. Not sexy, but rock-solid.

www.strategydynamics.com

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eBay/Skype split

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Sad to see the ill-fated marriage of eBay and Skype end in divorce. Though it’s more fun to celebrate strategy triumphs, disasters can offer important lessons too. An Economist article focuses on the sale itself and worries about eBay’s prospects, but doesn’t assess why the original strategy didn’t work. At its most basic, it was a common issue – over-optimism about how business A customers would form a strong and easily-captured potential customer-base for business B. [I made the same mistake ...

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Big car-makers ‘nibbled’ to death

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Seeing in the Economist these firms seeking billions in aid recalls a comment years ago by Tom Peters re their long, slow demise. They were not killed by overwhelming force of much stronger rivals – they were ‘nibbled to death’ – by Germans in high-performance saloons, by Japanese in compacts, then SUVs, and now in hybrids. What puzzles me in all this is that they had access to what they needed to win these smaller battles. These same ...

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Strategy in asset-heavy firms + model

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the Economist says Mr Obama plans big spend to fix US infrastructure. Origins of problems that led to bridges collapsing, water mains bursting, and massive sewage leaks are easy to see – politicians can always put off long-term investment in favour of short-term give-aways. But CEOs face similar temptations. Read on for a detailed explanation of this topic and an exercise to try for yourself …

This has become particularly prevalent since the fashion for privatising utilities – ...

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