MBA/ENG 290.2 2009

International Competition in High Technology
Class Syllabus

WORKING DRAFT FOR INFORMATIONAL PURPOSES
(SUBJECT TO MAJOR CHANGES)
Revision Date: August 21^st 2009

Please note: The password to access the class wiki, roster, and presentations is profwu. You must have a wikidot account to view and make edits.

Course Contents and Objectives
Class Format and Preparation
Team Presentation
Attendance and Feedback
Grades
Required and Recommended Reading
Web Resources
CLASS SCHEDULE

Introduction
Development of the Software-as-a-Service (Saas) Industry
Microsoft, Google and Yahoo
Competitive Advantage of a Firm within a Country: Finland and Nokia
Competitive Advantage of High-tech Nations: Singapore and Israel
Dell, HP, Acer, Asus, and Lenovo Value Chain
No Formal Class
Consumer Electronics: Then and Now
China and Online Gaming
India and Infosys
Value Chain Startup
Outsourcing for the World
Rise of Global Internet Giants: Google and Tencent

Course contents and objectives

Please note: Due to the changes in the market environment and the nature of the class, the course syllabus is subject to major changes and should only be considered a draft and work in progress.

The rise and fall of the high-technology industries reflect broad changes in markets, production organization, and business models, as well as the operation of government policies. These broader changes, which include but go well beyond the Internet revolution itself, suggest that the industrial economy is being fundamentally transformed by the diffusion of innovations in technology and business models across the industrial and industrializing economies. At the same time, these changes cannot be understood without a deeper examination of the factors that created competitive advantage at the national level in many of these industries during the previous three decades. This course explores the broad changes in "who is winning, who is losing, and why" in global markets for high-technology goods ranging from semiconductors to internet services to clean tech.

This course seeks to make sense of the decline and recovery of U.S. high-technology industries, the evolution of innovation and technology strategies and policies in Asia and Europe, the historic and current roles of governments in shaping markets for high-technology goods, and the impact on business strategies of recent developments in early-stage capital markets. Our general approach views technological innovation and competition as dynamic processes that reflect choices and policies made by firms and governments. Modern technologies develop in markets that are international in scope, often imperfectly competitive, and subject to influence by a variety of economic and political stakeholders. We will use an eclectic mix of practical, historical, and theoretical perspectives throughout the course in examining these issues.

Class Format and Preparation

The course will use a mix of case discussions, projects, lectures and guest speakers.

The expectation is that the cases and reading materials will be fully prepared for each session. Students are encouraged to Google outside sources to learn more about the company, case, outcomes and issues.

The format of the case discussions will be as follows:

Team Presentation

One team will have the opportunity to open the discussion of the case. Each case opening should consist of:

Slides summarizing a brief analysis of the situation, including what the numbers (if any) tell us.
The team's recommendations for the key decisions and answers to questions posted.

The total length of the case opening should be no more than 20 minutes. If your team makes use of overhead slides or other presentation material, you should limit yourself to just a few items. Case openings should emphasize the frameworks and models covered in class or elsewhere. You should submit one copy of slides and other presentation materials at the start of your session. Please note that everyone on the team does not have to present - it is usually recommended to pick one spokesman - in fact, I may pick the spokesperson. :

PowerPoint with Appendix of developed but unused slides.

Hotlinks to any websites used for preparation
References to any written materials used for preparation including:
1. Wall Street Industry Report for the company described in the case.
2. 10Ks
3. Website referenced
4. Other sources

Class participation is strongly encouraged. You are invited to highlight insightful linkages between class material and your past experience as a professional and a global observer, to raise challenging questions and issures related to topics in global competition and strategies being reviewed, and to participate actively in discussion of cases and global trends.

The instructor will also use a call list and any student may be called on at anytime. If for some special reason a student is not so ready for one class, please inform the instructor prior to class. Also, please use your name card throughout the semester.

Many classes will also have an international business executive guest speaker that will comment on the class analysis of the case as well as provide a forum for practical questions and answers. Due to speaker availability, session topics may be changed as the semester progresses.

Attendance and Feedback

Attendance is expected and unexcused absences will affect course grade. Excused absences are those officially sanctioned by the school’s academic regulations. In all cases of absence, professional conduct and courtesy dictate that the instructor be informed prior to class. Failure to do so will cause consternation and disappointment.

As "International Trade and Competition in High Technology" is a broad topic, the instructor will do his best to adapt the course based on current events and student feedback. As a result, mandatory email questionnaires will be occasionally be sent out following a class with the expectation of responses by Tuesday at 9am. This questionnaire is not expected to take more than 5-10 minutes to complete, but timely submissions will count towards your final course grade.

Grades

Course grades will be based on both team activities (50%) and individual activities (50%). Team activities will be decided primarily by assigned case openings and team member feedback on other team members. Individual activities will consist of class participation, email questionnaire responses, and any other extra credit projects (which can also be done with other students).

Extra credit projects will consist of either research questions assigned during class and/or projects approved by the professor.

Required and Recommended Reading

Required cases and articles will be published and purchased through Study.Net or referenced on the web. In addition, there are a number of recommended books to be referenced for use in cases.

The Competitive Advantage of Nations by Michael E. Porter

Crossing the Chasm, Inside the Tornado, and The Gorilla Game by Geoffrey A. Moore

The Innovator's Solution by Clayton Christensen

Three Billion New Capitalists by Clyde Prestowitz

The World is Flat by Thomas Friedman

Web Resources

The following websites contain information that will be used throughout the class.

www.professorwu.com - General course information, class wiki

www.study.net - Contains required cases and articles

http://www.sec.gov/edgar/searchedgar/webusers.htm - EDGAR database containing current and archived public company SEC filings

Class Schedule

Please note: Assignments are due the Tuesday before class at 6pm. Assignments should be submitted via email to Professor Wu (charles [at] professorwu.com) and Evette (mba290g [at] gmail.com).

· Prepare a short presentation on why the Technology World is Spiky or Flat? Outline the arguments for each perspective.

NOTE: I apologize - due to technical difficulties - team lists won't be up until this weekend.

· Overview of the latest developments in the enterprise software and SaaS sectors

Readings (note-you will find the wall street research reports in Haas' Online Library)

· Find and Read William Blair & Company's Industry Report - Software as a Service Update

1) Create a Presentation Designed to Educate a Board of Directors regarding the SaaS Industry

c) Is this a long term trend, what are the issues, is this a desirable new industry to enter or will it be dominated by others

2) Extra Credit: Put together a presentation explaining how/why these reports exist and are "free"

· Analysis of Public SEC Documents to understand competition, partnerships and the evolution of the Technology Industry

Please Note: I believe all the answers to these questions can be found in the Microsoft, Google and Yahoo SEC Filings found in Edgar. Please check the link under resources in the professorwu.com site. The Microsoft IPO prospectus can be downloaded from the professorwu.com site since the SEC filings don't include the Microsoft IPO prospectus.

· When did Microsoft go public? How fast was Microsoft growing? Were they cash flow positive or negative? How did they get cash for their growth? When did TVI invest in Microsoft and how much did they invest? Who did they list as competition?

· Why did Microsoft go public? Did they need cash for growth? Were the founders cashing out? Were there other reasons?

· What business(es) was Microsoft in? Who were their main competitors for each of the businesses?

· Map out the major product lines, revenue ramps and competition for Microsoft from SEC filings starting in 1994 until today

· When did Google go public? How fast were they growing? Were they cash flow positive or negative? How did they get cash for their growth? When did Sequoia and Kleiner invest in Google and how much did they invest for how much of the company? Who do they list as competition? When did Microsoft begin listing Google as their competition?

· What is the business model for Google? Who are thier main competitors? What is the AdSense program? Why do they have fixed network payments and how significant are the payments?

· What was Google's revenues at the time of IPO? When was Google started? When did it turn profitable?

· When did Microsoft begin mentioning Google as a competitor? Who did they previously mention as competitors? Map out the competitive landscapes for the MSN over the years? What was the relative revenue/profits between Microsoft MSN, Google, and Yahoo during Google's rise?

· When did Yahoo begin mentioning Google in their 10Ks? In what context? When did Yahoo start mentioning Google as a major competitor? Please track who Yahoo was mentioning as Competitors over the years? Which venture funds funded Yahoo?

· Explain the Dutch Auction methodology of the IPO. How does it differ from a normal IPO process?

· Understanding on strategic clusters within a nation for competitive advantage

· Read Case – Finland and Nokia: Creating the World's Most Competitive Economy

· Find and Read a Wallstreet Research Report (not an earnings statement) on Nokia and the telecommunications industry

1. Please outline the principal global competitive advantages of Finland in cellular phones based on the 4 major components of Porter’s Diamond: Factor Conditions, Demand Conditions, Related and Supporting Industries and Firm Strategy, Structure & Rivalry.

2. What developments in Finland led to the economic transformation in Finland? What was different about Finland’s telecommunication sector that led to Finland’s emergence as a global telecommunication powerhouse?

3. What was the cluster program? How did it stimulate R&D and technology innovations?

4. How did Nokia leapfrog Motorola in the early 1990s to become the No. 1 mobile phone company?

5. What challenges did Finland face by 2001? What strategy would you recommend the nation to take on?

6. Is Nokia's description of their history the same or different from the HBS case study?

7. Describe Nokia's current business. Where do most of their handset revenues come from? What are their fastest growing markets? Have they grown faster or slower than Motorola?

· California was just named the 8th largest economy (see attached article) in the world. What are the "top 10 economies" from a GDP/person measurement? How does California compare? How does Finland compare on both measures (GDP and GDP/Person)? How does Singapore compare? How does the Bay Area compare??

· Application of Porter’s National Diamond on cluster competitiveness across different geographies

· Overview on various economic and industrial policies in various parts of the world applied to stimulate growth of high-tech clusters

· Read Case – Developing a Source of Competitive Advantage: Israel's Version

1. Compare and contrast the economies of Singapore (4.5M population) and Israel (7M population) to the economy of the Bay area (7M population).

2. How do you explain Singapore's economic performance since 1965? How, in particular, have business-government relations contributed?

3. How do you explain Israel’s economic performance to date? How, in particular, has public spending in defense contributed?

- New market industry size and growth (Cell phones, MP3 players, pdas, servers etc.)

2. One slide summarizing the comparable companies analysis (found on the Dell wiki)

Semiconductor Foundries: UMC, Chartered Semiconductor, TSMC

Disk Drive Companies: Western Digital, Maxtor, Seagate

Non CPU Chip Companies: Video Company Nvidia, Intel/ATI (use either Intel segment numbers or last financial statement of ATI before acquisition), Wireless, Chip Company

Software: OS: MSFT, Palm, Psion; Application Software: Intuit, Symantec, Adobe, Microsoft

You can "imply market growth" from the growth of the major companies in the segment. New markets should be found in the segment information of the 10K - otherwise don't worry about it.

· Application of value-chain analysis and competitive advantage in a context of eroding market position

· Read Case – Innovating an "Outsourced R&D" Project for Matsushita Electric (MEI): Launching the Panasonic Digital Concepts Center

· Research Current Available Research Reports, Annual Reports, 10Ks, etc. of Philips, Matsushita, and Samsung

1. Please compare and contrast Philips vs. Matsushita based on the 4 major components of Porter’s diamond.

2. Please develop the internal product value chain for both Philips and Matsushita. Compare and Contrast.

3. How did Philips become the leading consumer electronics company in the world in the post war era? What distinctive competence did they build? What distinctive incompetencies?

4. How did Matsushita success in displacing Philips as No. 1? What were its distinctive competencies and incompetencies?

5. What do you think of the change each company has made to date: the objectives, the implementation, the impact? Why is the change so hard for both of them?

6. Samsung has had a gone from no-where to becoming a major consumer electronics player. Compare and contrast current day Samsung, Panasonic and Philips. How has Samsung done it. How do they develop products? Please use both Porter's Diamond and Value Chains to analyze Samsung/Korea.

1. Profile China’s advantages and disadvantages regarding outsourced manufacturing and also outsource services.

2. What measures has the government taken to encourage economic growth and especially the technology industry.

3. What are the key technology drivers that have enabled China's technology awakening.

5. Compare and contrast the economy of Shanghai (16M people+/-) to the economy of the Bay area (6M people +/-) and the other economies you have looked at (Finland, Singapore, Israel).

7. Analyze Online Gaming in China including “why china”. Why has China banned foreign investment in online gaming?

· Read case - Infosys Consulting in 2006: Leading the Next Generation of Business and Information Technology Consulting

2. What measures has the government taken to encourage economic growth and especially the technology industry.

3. What are the key technology drivers that have enabled India's technology awakening.

1. In 2006, how well is Infosys Technologies doing? What is the company's strategic position in the IT industry and what are its distinctive competencies? Where does it fit in the industry value chain? How would you describe its culture?

2. Why did Infosys Technologies decide to move into the IT consulting market segment? How big is this market segment and what is its structure? Why did they form a wholly owned subsidiary to enter this market segment?

3. In Raj Joshi's words, one of the goals of the leadership team of Infosys Consulting was to "change the rules of the game." What are the "rules of the game" currently, and how is Infosys Consulting trying to change them? What do they mean by the "Global Delivery Model"?

4. How important are client relationships and institutional knowledge in the consulting industry? How would you assess Infosys Consulting's competencies in these two areas? Does Infosys Consulting have a sustainable competitive advantage? If so, what is it?

5. How are IBM and Accenture likely to view what Infosys Consulting is trying to do? How can they respond?

1. Create a business plan for an app for the iPhone/Google Phone store to be sold into one of your "home countries". It is NOT for the US Market unless there is a value chain supply relationship that can be developed in your "home country". One of your team members must be from the target country.

You will be judged by the class with the following criteria. This is a pitch presentation that would be shown to venture/angel investors.

1. Your ability to create barriers to entry due to your value chain relationships. Typically this should include supply/input/eco-systems relationships with at least Apple or Google (and potentially other US/Silicon Valley companies) and distribution/marketing relationships with a foreign company in your designated "home country"...

An 30 second personal example - I have a relationship with Google Apps (I know the head of engineering), I also have a relationship with Meltwater (PR Monitoring), I have a third relationship with the President of Singapore Computer Systems - the largest MIS provider to the government in Singapore...so here is the following business plan...with the appropriate typical elements...

You will have 8 minutes to present

Review each class to date and summarize the top 2-3 things you learned from each class. This is an individual assignment.