Earlier this week, I started my review of Nokia. The company markets phones in the U.S., Europe and beyond that are easy to use but also have some unique functions. These phones allow users to switch between home and work settings. In the work setting, a person’s calendar is filled with conference calls and the address book has colleagues for contacts. But when the office door closes, the user has the opportunity to switch the setting to home. This setting has a calendar of dinner parties and children’s recitals, and the contacts are family and friends.
Taneli Ruda, one of Nokia's top strategists, admits that this feature is quite simple and competitors will find no great barrier to duplicating it if they choose.
But what makes this feature strategically valuable is not that Nokia has it, but rather from where Nokia got it: rural India. You see, in poorer parts of the world, many people cannot afford to own their own cell phones. Instead, they share phones with friends.
By following their Indian customers closely, Nokia observed this practice early and adapted. It began producing phones that maintained multiple identities to facilitate phone sharing. It works like this – when I want to use my shared phone, I simply set it to “Kaihan Krippendorff” and the phone transforms, offering me all of my phone numbers, not yours.
After successfully launching this technology, Nokia asked, “How can we use this in other places?” So they took a technology designed for the developing world and introduced into the developed one. Instead of switching between phone users, we switch between our home and work lives.
This is a nice example of pattern #7 at work: force your competitors onto a two-front battle.
Just as lions hunt in pairs to fluster their opponents, great innovators use one business to provide coverage for another and thereby fluster our efforts to compete head on.
We have at least 20 examples of this. Honda, for example, uses a capability in engine building to make cars, motorcycles, and even lawnmowers. Disney uses one character to make a movie, video game, ice skating show, and theater production. Virgin uses one brand to sell cola, air travel, music, and bridal gowns.
Nokia use insights drawn from India, China, Latin America, and Europe to complicate things for its competitors. You can’t compete with Nokia without competing across the globe.
But you can use lessons from Nokia to apply to your own business. Ask yourself the following questions:
1. Can I use my current business to produce something new or offer a different service?
2. What is my competitor not doing, and can I use that to force it onto a multi-front battle?