“Welcome to the world according to two curves. It’s a world in which the present is hard, but the future is doubly difficult-and the only certainty is change. Managing in this world is a lot like playing three-dimensional chess where you’ve got to see both near and far at the same time as you prepare to move up, down, across, and sideways.” 1)
A reality of the new global enviroment is the emergence of a new era of competition. Competition is arising not only from only from traditional adversaries in traditional markets, but also from the disintrgration of barriers to previously insulated and protected markets where companies no longer limit their growth to traditional customer bases. In information business managing both curves means this condition will give added value to the community of consumers and producers of infotech and telecommunication. Utilizing the infrastructure network efficiently and applying it on business information system will enable us to speed up the growth of business activities, where the company could easily retrieve information on market demand price competition, new product and service development and other kinds of information using local or wide area network of internet e-commerce system which can support the whole activities of business.
“Understanding the effects of new technologies,especially information technologies, is critical for managing on two curves. You could argue that without the vast and rapid proliferation of information technologies in the last twenty years, there will be no second curve. It is in fact the ability of new technologies to fundamentally transform a given industry that creates the discontinuities that define most second curves.” 2)
The powerful new electronic tools make highly tailored customer service
possible for companies such as Federal Express, AT&T, and United Airlines,
and the following step was made by a lot of companies using internet and
intranet network to close the customers and partners around the world.
1) Ian Morrison, The Second Curve – Managing the Velocity of Change, Nicholas Brealey Publishing, London 1996, page 2
2) Ibid, page 8
The Characteristics of the Second Curve, includes
1. Shift from big technology to high technology, so it enables to mass customization, a unique setof preferences, unlike anyone else’s
2. The new consumer are not what they used to be, more affluent and better educated. They have expectations that say they can have any product, any time,any place and they expect to get it at low cost
3. Potential market is going to emerge from the internet. What the people know as E-Commerce is the most exciting potential for the future in terms of retail channels. Being able to access information globally, systematically is quite attractive marketing technologies to show, promote and customize product service.
4. Activate direct marketing. Using E-mail,households with high incomes are the prime target for virtually all mail from business. This kind of targeted business mailing will most likely follow this wealthier household as they age and higher individual income.
5. The company as production users work achieving target based on network technology, easily get information from any suppliers around the world at any time and dealing with them at their first convinience.
6. The end of the middleman. In the second curve new consumers making direct connection to the producers using familiar IT – technology in the new geographic markets, so the channel of distribution is not just shortened, but moreover the unnecessary chain as middleman will be eliminated.
The Chosen Strategy in accomplishing Two-Curve World
1. Stay on first curve, it means to recognizing massive structural change, and getting as much from current market.
2. Jump to second curve, they should know timing of crucial, gauge pace of change, focus on profitable niches and surf the new paradigms of business.
3. Play both curves, it means redefine value chain, create second curve portfolios, shift curves by adapting different culture and competencies and ready to organize for two-curve success by establishing new learning organization and implementing more attractive incentives.
Managing on two curves should base on the policy ‘try to get out with the old, in with the new’, where the focus is directed on the pace of change and meanwhile build second curve capacity and learn to jump be fast and flexible. Go on to serve the new customer with its unique characteristic and having commitment to build a diverse management team. All managers and front liner should eager to interactive one to another, and maintain the coordination and control by utilizing provided network of information. It is a compulsory for new leadership to mastering the information technology as a necessity to control the system of organization and the changing of market business.
Due to the shifting of customer’s behaviors, the treatment requires better understanding from goods and service orientation to service and knowledge orientation.
The modification or restructuring organization directs to have responsive alertness of smarter customers, and faster exchange of information, external or serve internal needs.