Thursday, March 16, 2006

 

Battle of Business Models: Product Platform vs. Solution Integrator

In class, we discussed the tension between business models in the network era. I found an interesting article that discusses how Microsoft is taking on IBM consulting. I was particularly stuck by the following quote as it shows the role of software vs. expertise in human problem solving:

"We are huge believers in the magic of software, not the magic of outsourcing," Capossela said in an interview this week. "Our low-cost software that's partner-supported is a much more efficient way to go than to spend a lot of money on consultants."

It reinforces the role of expertise embedded in software that Microsoft believes is more valuable than expertise embedded in managerial experience that underlies IBM's consulting strategy.

See also the NY Times article that elaboarates on the tension (March 19, 2006)

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