Interlink Partners» Management Consulting / Strategy / Marketing / Mergers and Acquisitions

Positioning drives competitive marketing and sales

admin — Sun, 13 Sep 2009 00:18:35 +0000

Every business is in competition. Even if the competition is apathy or the preservation of the status quo. Your positioning is the simplest statement of how you can add value to your customer, so it is the simplest statement of how you stand in comparison with your competition.

It’s tempting to believe that your business is undifferentiated, commoditized, and that the only way to make progress is through pricing, or more aggressive sales. In fact every business can find differentiation and a unique positioning, and it’s one of the least expensive ways to strengthen your company.

Here’s an instructive story about differentiation in the most difficult of circumstances:

You might think that construction sand is the ultimate commodity. You can get it from anywhere, the standards are very basic. It comes off the back of a truck. Well, it turns out that construction sand is a critical deliverable in the life of a building project. In large cities with unionized workers, the cost of an idle construction team is crippling. So if the sand is late, it can cost you a fortune.

One construction sand company in New York figured this out, and added a performance guarantee to their product. They charge significantly more than their competitors, but they guarantee that if the sand is late, they will pay the costs of the idle workers. Suddenly they have added risk management into the mix. Risk management is a very important thing for a construction boss, with thousands of things to worry about and coordinate.

This is just one example: the key is to find some aspect of your business or process that you can develop into a differentiator, in a way that will create unique value. That becomes the basis of your positioning.

For a more extended description of the range of ways in which differentiation can be created, read this article.

Semiconductor business optimization

admin — Sat, 27 Jun 2009 21:43:17 +0000

The nature of the electronics food chain means that long-term differentiation is difficult. Some companies have it easier: specialized analog, a worldwide franchise in processor design, specialized memory architectures for example. But the bulk of semiconductor companies, while they may start with a strongly differentiated product, quickly find themselves operating in a standards-based, commodity-ridden business environment.

Standards are good: they help get technology adopted. But if your products are simply implementations of the standard, they are subject to commoditization, which leads to pricing pressure and low customer loyalty.

The challenge is that hardware design wins only last one generation, and you have to be the best in some meaningful sense to win each time. A purely hardware-based strategy for differentiation means you have to be clearly the best, generation after generation. You have to be the best in functionality, power consumption, level of integration, and price.

That’s a tall order for any company. It’s also hard to maintain, generation after generation.

Interlink Partners bring a deep understanding of the dynamics of semiconductors and the electronics ecosystem, from startup to Fortune 500, and from analog to digital SoC. From this experience we have distilled a set of processes for optimizing semiconductor companies in terms of a wide range of factors:

Fundamental product differentiation
Roadmapping
Ecosystem plays
Adjunct capabilities to extend the value proposition
User community leverage
System development enablement
Engagement in standards development
Market positioning and message strategy

Each of these areas represent significant and powerful ways to increase the stickiness and market power of your semiconductor products.

Our methodology is customized to your needs, combining executive interviews, practical workshops, hands-on strategy development, and executive support for implementation.

For more information and a confidential diagnostic interview, please contact us.

Differentiation for semiconductor companies

admin — Fri, 26 Jun 2009 23:31:49 +0000

Increasingly, the big winners in electronics are the systems companies that can claim consumer-level differentiation. Apple, for example, has been able to preserve margins and to maintain a powerful corporate brand and consumer loyalty even in the current difficult economic times. At the same time, many of their semiconductor suppliers have struggled to differentiate and to retain a position of value in the ecosystem.

This is a result to some extent of the challenging competitive environment, but it also arises from the high level of standardization in (especially consumer) electronics. DDR memory; ARM cores, USB, 802.11. All these standards mean that a systems company has greater choice, and an easier time switching out one semiconductor vendor for another.

Yet there are ways to strengthen your differentiation as a semiconductor company. Solution-level strategies, the use of proprietary IP, and service-level agreements are just a few of the techniques that can be employed.

If you would like to learn more about how your company can increase its differentiation in a tough market, contact us at info@srbcnetworks.com.