SEMESTER: Spring 2020

This course is dual-listed with the Full-time MBA Program.

COURSE NUMBER: EWMBA 290T.3

COURSE TITLE: Strategy for the Networked Economy (formerly Strategy for the IT Firm)

UNITS OF CREDIT: 2 Units

INSTRUCTOR: Jon Metzler

E-MAIL ADDRESS: jon.metzler@berkeley.edu

PREREQUISITE(S): Familiarity with microeconomics concepts (e.g. lock-in, network effects); cost accounting; and marketing concepts (customer acquisition funnels, retention, virality, churn and and customer LTV) will also be helpful. Students in this course will read investor relations material, MBA cases and industry readings. No previous tech industry experience is required.

CLASS FORMAT: Interactive discussion on a blend of cases, readings/podcasts, and instructor material, supplemented by guest speakers from industry.

MEETING DAY(S)/TIME: Tuesdays, 6:00PM-9:30PM

NOTE: Course will meet 10 times during the 15-week semester for 2 credits.

REQUIRED READINGS: Classes will take advantage of case studies showing success and failure, and instructor material. We will also utilize excerpts from various books, including Competitive Advantage; Information Rules; The Idea Factory: Bell Labs and the Great Age of American Innovation; The Master Switch: the Rise and Fall of Information Empires; The Innovator's Dilemma; The Qualcomm Equation; How We Got to Now; Startup Communities and more. In addition, we will utilize investor relations material and various industry articles.

BASIS FOR FINAL GRADE:

· Preparation, Attendance & Participation: 30%

· Written Assignments (three individual papers): 30%

· Group assignments (5 mini group write-ups): 10%

· Group Project (final presentation and paper): 20%

CAREER FIELD (WHO SHOULD TAKE THIS COURSE)

· Students wishing to work, or to deepen their work, in tech, telecom, media and related fields (TMT).

· Students working in sectors adjacent to or supporting TMT firms, such as consulting, accounting, investment, advertising, software and services

· Students at firms buying from or selling to telecom, media, Internet companies and IT companies.

· Students at or from traditional firms facing market entry by new technology firms.

· Students who want to deepen their understanding of Silicon Valley and the history of tech.

ABSTRACT OF COURSE'S CONTENT AND OBJECTIVES:

In 2019 this course was called Strategy for the IT Firm. To reflect its substance, it is now called Strategy for the Networked Economy. We will cover tech, telecom and media subjects (network operators, media business models); IT and the enterprise (use of enterprise data; the changing role of IT); and also more broadly discuss the impact of platforms and connectivity on business and society.

We will focus on sources of competitive advantage in tech markets. Two are from Michael Porter, and six are added for the purpose of this class:

· Cost advantage (low-cost leader)

· Differentiation: providing differentiation sufficient to justify pricing above providers providing functionally comparable products

· Ecosystem Advantage: for example, having more software developers on your OS or product; or having more providers or distributors of a technology versus other alternatives

· Talent Advantage: having the best people in your organization (Bell Labs, Google)

· Process Advantage: being able to manufacture or distribute your product in some disruptive new way (e.g. Dell and the PC; fast fashion)

· Data Advantage: having the best data set

· Channel Advantage: having more / better channel partners that can reach the end customers than your competitors (e.g. Cisco in networking; Samsung in smartphones in the US)

· Culture Advantage: this is added based on feedback from spring 2018 MBAs

We will look at cases where these apply, and also cases where new market entrants had *none* of these advantages and still successfully entered the market. We will take the perspective both of the market entrant and the incumbent looking to fend off or harness new entrants.

The class schedule is below. This class meets 10 times and does not meet all 15 weeks.

· January 21 (Class 1 of 10):

o Part 1: Introduction, reading, goals; Sources of advantage; Bell Labs and Silicon Valley eras; Innovator's Dilemma;

o Part 2: Build/Buy/Partner; Nokia case (and different potential outcomes for Nokia); smartphone ecosystem stakeholders; revisiting the innovator’s dilemma; Nokia today

· January 28 (Class 2 of 10):

o Part 1: Network effects, virality and retention; on-demand markets; network effects and electric vehicles

o Part 2: technology platforms; the Skyhook Wireless case (when the platform eats your business)

· February 4 (Class 3 of 10):

o Part 1: Lock-in and switching costs; the mobile carrier ecosystem; grading network operators; Bharti Airtel case;

o Part 2: growth in saturated wireless markets; AT&T EDO case; 5G

· February 11 (Class 4 of 10):

o Part 1: Standards, interoperability, migrations and disruptions; the Sprint standards saga; “6G” selection;

o Part 2: overcoming ecosystem (dis)advantage; Qualcomm's market entry; reference customers; semiconductor consolidation

· NO CLASS FEBRUARY 18

· February 25 (Class 5 of 10): FIRST INDIVIDUAL PAPER DUE

o Part 1: Content acquisition costs and business model implications; Netflix teardown;

o Part 2: mobile app economy, customer touchpoints and franchise-building; transmedia story telling; Rovio (Angry Birds) case

· March 3 (Class 6 of 10):

o Part 1: Beachhead products; Apple in 2006 case; Apple’s next beachhead?

o Part 2: Government and tech innovation; DARPA, ARPA-E, In-Q-Tel, ARRA and more; Fisker vs Tesla

· March 10: NO CLASS (FTMBA OPERATIONS MIDTERM)

· March 17 (Class 7 of 10) SECOND INDIVIDUAL PAPER DUE

o Part 1: Transformations I: the shift to the cloud; freemium models; Adobe case: moving to subscriptions; ecosystem advantage

o Part 2: Transformations II: Industry 4.0; GE case (GE and the Industrial Internet); channel advantage; GE today

· March 24: NO CLASS BerkeleyHaas Spring Break

· March 31 (Class 8 of 10)

o Part 1: Data and the enterprise; P&G case; data advantage

o Part 2: Process advantage and replicability; relative cost advantage; the Dell case; clusters; changes in device retail; relationship customers and channel advantage

· April 7 NO CLASS

· April 14 (Class 9 of 10): THIRD AND FINAL INDVIDUAL PAPER DUE

o Part 1: Moonshots and “new normals”; Moonshots of invention (Apollo Mission, the first cross-country call) and integration (self-driving cars); moonshots and distribution

o Part 2: Software Eats; recognizing "software eats" in your market; channel advantage, ecosystem advantage and defending your turf as an incumbent (Marriott vs Airbnb; Ford vs ____)

· April 21 (Class 10 of 10): final presentations

BIOGRAPHICAL SKETCH:

Jon Metzler is Lecturer at the Haas School of Business. He lectures in the EWMBA, FTMBA and UGBA programs on competitive strategy; strategy in the networked economy; and international business (SIB: Japan, and IBD). He is also associated faculty for the UC-Berkeley Center for Japanese Studies. He has received research support from the UC-Berkeley Center for Long-Term Cybersecurity and from tCenter for Japanese Studies. Research areas include 5G and cybersecurity and sharing economies. Jon has new venture creation experience in print, digital media, events, location services, edtech, services and more. He is also founder and president of Blue Field Strategies, a consulting firm serving telecom, media and technology clients, including wireless carriers, device makers, infrastructure providers and content companies. Previously Jon was Business Development and Government Affairs Director at Rosum Corporation, a pioneering location technology company now part of TruePosition (Liberty Media). There he handled business development, government affairs, PR and standards. Jon represented Rosum in the National Emergency Number Association and Advanced Television Systems Committee, and secured development funding from DARPA, among others. Jon is a graduate of the University of California, Berkeley MBA/MA-Asian Studies program. While at Haas, he co-founded the Berkeley Asia Business Conference and authored a thesis comparing new venture creation in Silicon Valley and Japan.  From 2008-2017 Jon was a research fellow for KDDI Research, the research arm of telecommunications provider KDDI. He is a faculty mentor at Berkeley Skydeck and board chairman for the Japan Society of Northern California. He is also an advisor to various startups. @jonjmetz