Chapter 7: Technology Accelerators Group 4: audrey mackenzie, zach vanbibber, jordan martin, Laura mcmillan, anders bengtson and david baseme

Technology does not cause greatness

Walgreens vs. Drugstore.com

1. Drugstore.com achieved early success

  • Stock prices increased
  • The high point was a market valuation of over $3.9 billion

2. Drugstore.com caused Walgreens` stock to drop 40%

Walgreens Strategy

"We`re a crawl, walk, run company" - Dan Jorndt
  • Walgreens decided to deliberate rather than act quickly
  • Crawl- they began with a small, simple website to test the waters
  • Walk- They connected the internet with their inventory management
  • Run- Walgreens eventually developed a website equally sophisticated as Amazon at the time
"How can we use the web to enhance what we do better than any other company in the world in a way we`re passionate about?"
  • Walgreens used the internet to enhance their strategies and capabilites
  • Technology did not create their value, it only enhanced it

The fate of drugstore.com

  • Within a year, drugstore.com was trading stock at a price of 26 times lower than when it began
  • Went from a run to a walk to a crawl

Technology is an accelerator, not a creator of momentum, and great companies view the idea differently

  1. Technology does not create momentum. These companies became pioneers after grasping and fitting technology in their circles
  2. "Hedgehog Concept"- a company should analyze what technology fits into the hedgehog concept

The Technology Trap

The Daytona 500 is not won by the car, but by the driver

  • no matter the technology a company has, that will not propel them to greatness
  • Only one of seven Nucor executives picked technology as the number one reason for their shift
"Twenty percent of our success is the new technology that we embrace... [but] eighty percent of our success is in the culture of our company"

Nucor passed Bethlehem steel in 1986 because they had already lost more than 80% of its value in the market

  • Technology can not only accelerate growth, it can accelerate a company`s demise
  • Nucor wisely used technology to surpass Bethlehem as they were on the decline

The fear of being left behind

  • Those who built good to great companies weren't driven by fear of being left behind
  • Motivated by a drive for excellence for its own sake
  • Stayed true to the fundamentals and maintaining balance will accumulate momentum to break into greatness

Credits:

Created with images by StartupStockPhotos - "entrepreneur startup start-up" • FirmBee - "office notes notepad" • Cydcor - "Cydcor Conference attendees" • FirmBee - "office freelancer computer" • cdu445 - "roundtable light interior design" • StartupStockPhotos - "startup start-up notebooks" • FirmBee - "office notes notepad"

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