Markets and Resources
Right Hemisphere’s success in creating a new product in an uncontested market space can be attributed to successfully balancing strategy paradoxes as well as successfully implementing a Blue Ocean Strategy that have been discussed in the lines below. Right Hemisphere’s case clearly highlights the paradox of Globalization and localization. This is highlighted by their strategy to go global with their company as reflected in Mark Thomas’s quote “It is no use to become as we say over here “world famous in New Zealand” before ultimately heading to Australia.
The biggest risk to a New Zealand Company is not exporting and unless you are measuring your product in global sense, you will get beaten in your own market sooner than later”. This thought essentially outlined the benefit of Right Hemisphere embracing the concept of going global as it enabled them to successfully deal with cross – border customers, deal with cross – border competition and also permitted them to think big.
A globalization strategy needs to go hand in hand with an effective localization strategy in order suit the specific demands of each national market. This is highlighted effectively in Right Hemisphere’s decision to relocate their head office to the USA as it
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” This thus makes it evident that Companies must be responsive to local conditions and yet at the same time strive to create cross – border synergies as done by Right Hemisphere in retaining the Research and Development in Auckland while moving the head office to USA all with an aim to add / create additional value. (Wit and Meyer 2006). Right Hemisphere’s success also highlights another paradox that organizations face of the paradox of Markets and Resources.
The current scenario describes this by Right Hemisphere’s initial entry into the mass graphics market in 1997 with the painting tool – Deep Paint 1. 0 and other subsequent offshoots of this product that catapulted them into becoming household names in the entertainment graphics and animation game technology communities. The success also brought with it a new understanding of the market environment that made them eventually to change their initial mission from becoming a global leader in engineering 3D graphics to aspiring to become a global leader in Product Graphics Management.
This consequently led to the creation of an entirely new product market with no competition and no established rules to play the game. The creation of this new product (system) involved leveraging on their knowledge of the entertainment and technology graphics industry to enhance their PGM systems. The success of the new PGM systems as well as the enormous amount of resources involved with maintaining and updating Deep Paint consequently led to Right Hemisphere exiting this market in 2002.
This strategy balanced the paradox of Markets and resource as they had adapted to a new market position after their initial success and using their knowledge of the industry which had taken years of acquiring Right Hemisphere incorporated these existing resources with the aim of developing a system in a new product market with no competitors. Right Hemisphere thus successfully subscribed to the quote “Sell where you can, you are not for all markets. ” (Wit and Meyer 2006)Right Hemisphere’s success is also reflected in their understanding of the paradox of Competition and Cooperation.
This is highlighted when they realized that as they could not compete on an even footing with the bigger established companies over the long run in the mass markets of graphics they decide to pull the plug on Deep Paint and concentrate on developing PGM systems, however as time progressed Right Hemisphere realized that if they could not beat competition they could certainly co operate with competition which they successfully did by licensing their 3D viewing technology to Adobe Systems for use in their highly successful software Adobe Acrobat Reader.
Cooperation as defined is the collaborative behaviour exhibited by organizations where both sides need each other to succeed. In Right Hemisphere’s case Adobe systems benefitted from the collaboration as it unlocked industrial 3D content trapped in CAD system transforming them into a universal lightweight format that could be embedded in PDF documents. Right Hemisphere’s benefit was that it gave them access to the millions of people who used Adobe acrobat reader and consequently it also led to Right Hemisphere’s 3D capability becoming the industry standard.
Right Hemisphere’s strategy can best be summarized by the quote “We have no eternal allies and we have no perpetual enemies. Our interests are eternal and perpetual, and those interests it is our duty to follow. ” (Wit and Meyer 2006)Right Hemisphere’s success if anything can best be explained by their power of Innovation which is the crucial element in a Blue Ocean Strategy. Blue ocean essentially relates to all the industries that are not in existence today and thus it relates to an unknown market space.
A successful Blue Ocean strategy is governed by the ability to be innovative in order to create an uncontested market which was precisely what occurred with Right Hemisphere’s successful establishment of a new market defined as Enterprise Visual Communication (EVS). Their path to creating this uncontested space involved a systematic procedure with Right Hemisphere’s initial successful foray into the mass graphics market with Deep Paint 1. 0 followed with its subsequent entry into the gaming and technology markets further establishing their brand.
The next big stage revolved around the thinking behind their path breaking innovation and subsequent development of the new product made Right Hemisphere realize the true potential of their innovation as described in their forecasted value of around $10 billion over the next decade. Right Hemisphere’s successful implementation of a Blue Ocean strategy can best be summed up by Thomas’s quote “People often talk about us as a company with a niche strategy. It is not quite right. We are in a new and still emerging industry with no clear borders, no specific competitors and no clear established rules to play the game”.
(Dufour 2009)Right Hemisphere’s present situation makes me strongly believe that they would need to wait and watch for the game to heat up before deciding on their next action plan. Even though in the past they have had a “pro-active” strategy i. e. creating a new product and market space as described above. The current situation demands a “reactive” strategy i. e. wait and watch as that would help them to raise the bar on the key core competencies as and when competition does arrive and thus also keep their competition in check. This will also result in sustainability and renewal of their Blue Ocean Strategy.