Three Case Studies on Innovation Strategy
Three pharmaceutical companies — Able, Baker, and Charlie — are among the most successful pharmaceutical businesses in the world. Able and Baker are very large. Charlie is medium-sized, but growing fast. All three companies spend about the same percentage of their revenues on research. There the similarity ends. Each of them approaches research quite differently.
Able’s aim is to gain early leadership in a major area, acquire dominance in it, and then maintain this leadership position.
Able Company—spends a great deal of research money on one carefully selected area at a time. It picks this area when pure research in the universities first indicates a genuine breakthrough. Then, long before commercial products are available, it hires the very best people in the field, and puts them to work. Outside of these areas, however, the company spends no research money and is perfectly willing not to be a factor at all. The company takes big positions in big fields at a very early stage, at great risk, but also at great reward.
ACTION POINT: Able Company is pursuing the _____ entrepreneurial strategy (see August 16) and the _____ window of opportunity (see July 12).
Management Cases
* Source: The Daily Drucker by Peter F. Drucker