Archive by Author | laduc01

Digital Transformation Project: Elsevier and the cloud

Elsevier is a world-leading scientific publishing company and offers over 2,500 unique journals and more than unique 33,000 book titles (Elsevier, 2015). These offerings are unique and therefore differentiate them from the competition. Additionally, Elsevier offers web-based, digital solutions, such as ScienceDirect, Scopus, and Reaxys. These unique services enable researchers, students and other individuals to better consult the content made available by Elsevier (and other publishers). These solutions are just an example of all the Internet features Elsevier tries to implement into their business fundamentals. Currently, Elsevier’s business is shifting from scientific publisher towards a professional information solutions provider. Elsevier’s CEO Ron Mobed is encouraging the business to ‘Lead the way’ (Mobed, 2014). From this corporate vision, we can infer that Elsevier is striving to implement new technologies in order to disrupt the publishing industry.

To generate revenue, Elsevier mainly sells access to scientific journals to its customers. The value proposition Elsevier offers is that they consult the institution how to generate revenue with their services. The demonstration of this value proposition is done on a yearly basis by Sales directly to the institution. However, these business-to-business negotiations are transforming due to emerging technologies, which for example result in the increase of consumer informedness (Li et al., 2014).

To control this transformation (e.g. consumer informedness) and provide other complications regarding technology development, we propose an online application driven by cloud computing. It is an online platform where the institution can login, create and adjust similar metrics as currently shown by Sales. This innovation will further expand the current concept of Elsevier’s value to the institutions, but will introduce risk since institutions are not required to contact Elsevier anymore for these metrics. The same focus will remain, where not only the value of their investment in Elsevier is presented, but also how Elsevier’s services contribute the institution‘s revenue through an increased institutional competitiveness and collaboration among researchers. Competitiveness will help the institution to gain a better market position and earn more out of four sources: block funding, project funding, commercial monetization, and tuition and endowment. Collaboration among researcher will improve the quality of their research, which will lead to better publications and will result in more value for the institution. In conclusion, the online application will lead to more captured value for Elsevier and lead to more value and revenue for the institution.

References

Elsevier, 2015. At a Glance. [Online] Available at: https://www.elsevier.com/about/at-a-glance [Accessed 7 October 2015].

Li, T. et al., 2014. Consumer Informedness and Firm Information Strategy. Information Systems Research, 25(2), pp.345–63.

Mobed, R., 2014. Elsevier’s vision. Amsterdam, Netherlands: Elsevier. Internal employee presentation.

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The transformation of television

On 9 September, Tim Cook (CEO Apple) says: ‘the future of television is Apps‘ (Apple, 2015). Not everyone will agree, but it is almost certain that this industry is on the brink of a huge transformation. The only challenge left for television is the input problem, where people primarily pay for traditional, linear, pay-television services and besides that own a secondary device (e.g. DVD player, Apple TV) for additional content (Yarow, 2015). However, it is unclear if or when the ‘secondary’ service can be a substitute for the conservative primary services. Some predictions state that these new devices (e.g. Apple TV) could turn the television into a dumb piece of glass (Yarow, 2015), since many companies are making a bet that the largest screen in our homes is going to become an operating system like the ones that power our computers and phones (Hempel, 2011).

Apple

Many things have changed since devices are connected to the Internet. Millions of independent developers have got the chance to create great applications for multiple devices. The television is next and many start-ups will look for opportunities to offer video experience via applications on products such as the Apple TV (Yarow, 2015). Besides that big companies are forced to adjust their content as well. For example, Jeff Bewkes (CEO of Time Warner) spoke about the company’s plan to move its vast catalogue of movies and TV shows onto the Web (Lyon, 2011). Besides that, products like the Apple TV provide opportunities for all kinds of businesses (e.g. Netflix, HBO) to broadcast their content in a new way on the biggest screen in the house.

To convince the consumer, the only way to win it digital is to keep it simple (Lyon, 2011). Then if the new platform works, the prediction is that the traditional, linear, pay-television services will become secondary, because people will start to wonder why they are wasting money on this conservative service (Yarow, 2015). To make this transformation from traditional television to the Internet happen, some things need to be taken into consideration. Especially content expectancy, social influence, facilitating conditions, hedonic motivation and habit have significant effects on behavioral intention on (mobile) television (Wong et al., 2014). Additionally, Wong et al. (2014) claims that gender and other demographics tend to have a moderating effect on this television behavior. The question remains if online television is better in serving the needs of users than the traditional television service. And will suppliers be able to adapt new technologies to capture value? AppleResearch implies that this adaption is needed. For example, the viewer engagement actually is greater when social media is involved (Pynta et al., 2014), and new social possibilities come along with Internet on television.

From the supplier side, the web has the power to make media distribution cheaper and more efficient (Hempel, 2011). On the other hand, the current business model heavily relies on the revenue they earn from licensing. In each country there are able to capture value since it is legally possible to capture value in each geographic region. The web is breaking this business model. Ad rates are much lower on the Internet. Networks cannot collect their fees. Cable companies fear losing our business. Someone has to pay for all that bandwidth we are using to stream our shows (Hempel, 2011). This means that the suppliers must look for new opportunities to generate their revenue. The Internet on television not only brings opportunities, but also big challenges for the current participants, if they want to stay alive.

Vincent Laduc (417658vl)

References

Apple, 2015. Apple Special Events. [Online] Available at: http://www.apple.com/apple-events/ [Accessed 1 October 2015].
Hempel, J., 2011. What the hell is going on with TV?. [Online] Available at: http://fortune.com/2011/01/03/what-the-hell-is-going-on-with-tv/ [Accessed 1 October 2015].
Lyon, D.W., 2011. JEFF BEWKES AND THE APPLE TRAP. B-School Connection.
Pynta, P. et al., 2014. The power of social television: Can social media build viewer engagement? A new approach to brain imaging of viewer immersion. Journal of Advertising Research, pp.71-80.
Wong, C.H., Tan, G.W.H., Loke, S.P. & Ooi, K.B., 2014. Mobile TV: A new form of entertainment? Industrial Management and Data Systems, 5 August. pp.1050-67.
Yarow, J., 2015. The new Apple TV will blow up the TV industry. [Online] Available at: http://uk.businessinsider.com/the-new-apple-tv-is-going-to-blow-up-the-tv-industry-2015-9?r=US&IR=T [Accessed 1 October 2015].

iPhone 6S created by Samsung?

On 9 September 2015 Apple presented the iPhone 6S, where they claim: ‘The only thing that has changed is everything’ (Apple, 2015). On the other hand, Samsung claims that ’The next big thing is (already) here’ with their new smartphones (Samsung, 2015). Since I need to buy a new phone very soon, I am starting to doubt how different these products actually are.

The acknowledgment must be made that these companies do not make these phones by themselves. For example, Apple has over 200 suppliers to create their products (Apple Inc., 2015). Besides that Samsung aims to strengthen its position as worldwide computer chip manufacturer (ANP, 2015), which implies that they supply other firms to make their electronic devices (e.g. iPhones).

According to Kaufman et al. (2010) these business networks emerge because customers are more informed and therefore increasingly demanding products and services tailored to their specific needs. This results in business networks, which are able to break up their value chain into independent modules (Kauffman et al., 2010) and thereby are able to add more value to the final product (Ketchen Jr. et al., 2004). One of the reasons to participate in a business network is that it accomplishes more as a whole than the value it can capture by its individual parts (Kauffman et al., 2010). Another reason, especially in this technology driven industry, is that business networks tend to be more innovative (Möller & Rajala, 2007) (Gnyawali & Park, 2011). Therefore all these firms help to grow their entire business network (Gnyawali & Park, 2011), to motive more external parties to join the network (Gallaugher, 2014) and further improve their competitive advantage with their final product (Ketchen Jr. et al., 2004).

apple-vs-samsung3The uniqueness of Apple’s business network is that a direct competitor (e.g. Samsung) is a supplier for their products (e.g. iPhone). Scientific literature names this phenomenon co-opetion, where end-product competitors are contributing in each other’s value chain. As aforementioned a reason to embrace co-opetion is more innovation (Gnyawali & Park, 2011), but this still does not clarify why for example Samsung might cannibalize its own products. An explanation is that co-opetition is only beneficial when businesses are still able to differentiate with their value adding activities (Ketchen Jr. et al., 2004). Therefore if end-product competition is growing, businesses are trying to further protect their differentiating activities (Ritala & Hurmelinna-Laukkanen, 2009). A good example from Apple and Samsung are the patent wars they are having for the past few years. They are blaming each other for copying each other innovations to protect their differentiating activities. However, co-opetition will still be beneficial for both parties, since another observance states that it results in less vertical integration and more diversification (Gnyawali & Park, 2011). For example, this ensures that Samsung can further grow as a chip manufacturer without the interference of Apple. Additionally, the suppliers of companies such as Apple benefit from the demand they generate (Zhang & Frazier, 2011). Therefore the question about co-opetition should be: do we as a business want to capture value from competitors or establish a greater competitive advantage? (Park et al., 2013)

To be honest I really admire the research done about this phenomenon named co-opetition. However I still can’t figure out my personal issue. Therefore I would like to ask you: what phone should I buy? Since I can’t see the difference between the products of Apple and Samsung anymore after this study.

Vincent Laduc (417658vl)

References
Anderson, A., Park, J. & Jack, S., 2007. Entrepreneurial social capital: Conceptualizing social capital in new high-tech firms. International Small Business Journal, 25, pp.245-72.

Anon., 2014. In Gallaugher, J. Information Systems: A Manager’s Guide to Harnessing Technology. Saylor.

ANP, 2015. Samsung wil verder groeien als toeleverancier. [Online] Available at: http://www.nu.nl/mobiel/4132940/samsung-wil-verder-groeien-als-toeleverancier.html [Accessed 25 September 2015].

Apple Inc., 2015. Supplier Responsibility. [Online] Available at: https://www.apple.com/supplier-responsibility/our-suppliers/ [Accessed 23 September 2015].

Apple, 2015. iPhone. [Online] Available at: http://www.apple.com/iphone/ [Accessed 1 October 2015].

Gnyawali, D.R. & Park, B.-J.(., 2011. Co-opetition between giants: Collaboration with competitors for technological innovation. Research Policy, 40(1), pp.650-63.

Greve, H.R., Baum, J.A.C., Mitsuhashi, H. & Rowley, T., 2009. Built to Last but Falling Apart: Cohesion, Friciton and Withdrawal from Interfirm Alliances.

Hitt, L.M., 1999. IT and firm boundaries: Evidence from panel data. Information, 10(2), pp.134–49.

Kauffman, R.J., Li, T. & van Heck, E., 2010. Business Network-Based Value Creation in Electronic Commerce. International Journal of Electronic Commerce, 15(1), pp.113–43.

Ketchen Jr., D.J., Snow, C.C. & Hoover, V.L., 2004. Research on Competitive Dynamics: Recent Accomplishments and Future Challenges. Journal of Management, 30(6), pp.779-804.

Möller, K. & Rajala, A., 2007. Rise of strategic nets — New modes of value creation. Industrial Marketing Management, 36(7), pp.895-908.

Park, B.-J.R., Srivastava, M.K. & Gnyawali, D.R., 2013. Walking the tight rope of coopetition: Impact of competition and cooperation intensities and balance on firm innovation performance. Industrial Marketing Management , 43, pp.210-21.

Ritala, P. & Hurmelinna-Laukkanen, P., 2009. What’s in it for me? Creating and appropriating value in innovation-related coopetition. Technovation, 29, pp.819-28.

Samsung, 2015. Homepage. [Online] Available at: http://www.samsung.com/us/ [Accessed 1 October 2015].

Zhang, J. & Frazier, G.V., 2011. Strategic alliance via co-opetition: Supply chain partnership with a competitor. Decision Support Systems , 51, pp.853-63.