STRATEGIC ISSUES, OPPORTUNITIES AND VULNERABILITIES

Opportunities around innovation

Strategic Issues
i) New markets opening up like retailers, focus innovation on
1) Pricing- Low entry barriers, new competitors driving price down
2) Innovation becoming obsolete within a short time, return on
investments have to be in a short time
3) Supplier- Dominant position of supplier (Intel) – high input costs
4) Regulatory issues – selling (especially exporting) and making high
technology products
5) New players like custom assemblers
6) Software upgrades being incompatible with current hardware
niche segments
ii) Partner with emerging players like AMD to innovate and
reduce the power of suppliers like intel
iii) Increase innovation focus on segments that have higher
brand loyalty like server markets and corporates
iv) Process improvement innovations to reduce costs
v) Not just focus on product innovation, develop innovation
around the whole value chain, eg: distributor network

Vulnerabilities around innovation

1) A rapidly changing environment where technology
becomes obsolete quickly
2) Increased consumer awareness about choices of
products and cost-benefit analysis of these products
3) Efforts by suppliers like Intel to increase its sales by
promoting a market structure where there are large
number of PC companies