Archive for March, 2010

Business Models Based on Sharing

March 17, 2010

Robin Chase In 2009, Time Magazine named Robin Chase one of its 100 Most Influential People, thanks to her pioneering ideas on transportation, beginning with her successful founding of Zipcar.

Inspired by car-sharing models in Europe, Chase brought to life a “car rental by the hour” platform in the U.S. Through a simple usage proposition, word-of-mouth marketing, and great customer service, Zipcar has expanded enormously over its ten-year existence–eventually spurring similar offerings from the more established car rental companies.

In founding Zipcar, Chase was also driven by a desire to develop transportation business models that were more sustainable and ecologically balanced. So her next venture, GoLoco, is the first company to combine ridesharing, social networks, and easy payment to help reduce carbon emissions. She explains the importance of the concept to BusinessWeek,

I see GoLoco as an immediate solution. It means I don’t have to wait for the government to introduce carbon taxes or congestion charges, or put in smart development or light rail or transit. Today, with the infrastructure we have, we can do something which dramatically reduces costs and emissions.

To read more about this new idea and Chase’s views on transportation, cooperative capitalism, and technology, visit her blog.

To hear Robin Chase speak at BRITE ’10, register now.

BY MATTHEW QUINT

Culture Eats Strategy for Lunch

March 15, 2010

Dwayne SpradlinIn talking with one of his clients about the barriers to open innovation within an organization, Dwayne Spradlin, CEO and President of InnoCentive, received a wonderfully insightful quote: “Culture eats strategy for lunch.”

As Spradlin told BusinessWeek (podcast), the right culture is essential to making open innovation work. When leadership supports it from the top, Spradlin believes that “people will be extraordinary.” If middle-management receives the necessary permission to be creative and come up with new ideas, they will be the ones who drive open innovation.

Founded in 2001, InnoCentive works with a wide range of businesses to develop incentive-based innovation challenges. Solutions are found by a community of problem solvers spread all around the world. From running these challenges and working with clients, Spradlin offers the following advice for organizations looking to tap the power of an open innovation system:

  • Make sure that you create an innovation challenge only for tasks that you intend to move forward on.
  • Ask the right question–think of a specific “what if” question that might result in a business advancement, rather than just posing general business problems.
  • Harness a group of “problem facilitators” with the skills to develop the right questions and evaluate the solutions to your innovation challenges. This will improve the efficiency of the rest of your company when it moves forward with innovative ideas.

To hear Dwayne Spradlin speak at BRITE ’10, register now.

BY MATTHEW QUINT

How Brand Helps Predict the Future Value of a Business

March 12, 2010

How to Better Value Braded BusinessHow much is an organization’s brand worth?  The question of how to value intangible assets, such as IP and brand equity, is certainly a pressing issue with no definitive answer as of yet.  However, Natalie Mizik, a professor at Columbia Business School, and her colleague Robert Jacobson, recently found evidence that incorporating brand equity into a financial analysis can better predict the total value of a firm.

Mizik and Jacobson found that by incorporating Young & Rubicam’s BrandAssetValuator and its five brand metrics into a multiplier-based valuation, they made a 16% more accurate prediction of a firm’s value than when using traditional accounting variables alone.  They did find, however, that the predictive power varied across different sectors, with much less impact on retail and apparel and the greatest impact on consumer durable goods.

The nitty gritty details of Mizik’s and Jacobson’s analysis (not for finance- or math-phobes!) are available here. And, in fact, they may come in useful for anyone making the argument that brand equity does deliver financial impact.

To request a copy of Mizik’s (slightly less technical) BRITE Research Brief: How to Better Value Branded Business, contact: ColumbiaCaseWorks@gsb.columbia.edu

BY MATTHEW QUINT

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