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Profit Patterns: 30 Ways to Anticipate and Profit from Strategic Forces Reshaping Your Business

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As in The Profit Zone, the co-authors pose and then answer key questions. They also provide numerous checklists which enable the thoughtful reader to undertake a rigorous self-diagnosis. For example, in Part II, such questions and checklists direct and enrich understanding of Mega Patterns, Value Chain Patterns, Channel Patterns, Product Patterns, Knowledge Patterns, and Organizational Patterns. In effect, the authors create an infrastructure within which to organize and then correlate the most relevant experiences of dozens of corporations with the specific circumstances of the reader's own organization. Better yet, although most of the corporations discussed are among the "Fortune 100", this infrastructure is of substantial (if not even greater) value to small-to-midsize companies as well.

In Part III, Slywotsky & Morrison explain HOW "Strategic Anticipation" enables managers to anticipate and respond quickly to patterns as they unfold. Strategic Anticipation helps managers to "move where the value will be." Patterns "hint at the future strategic story of a company or industry, explain the past and describe the present."

Those who have not read Profit Patterns and do not plan to do so can only hope is that the same is true of their competitors. But don't bet on it.

"Profit Patterns" was an assigned book for the capstone course in the MBA program at Golden Gate University and was an appropriate recommendation for the depth and breadth of coverage it gave to the issue of strategic pattern thinking.

The premise of Profit Patterns by Adrian J. Slywotzky and David J. Morrison is that we learn from experience by studying patterns. Good managers are skilled at strategic pattern recognition and see the whole picture. Industries are reshaped by patterns, which may build slowly or move rapidly, and the ability to recognize and capitalize on these patterns allows an organization to create strategies that lead to sustained value and profitability. In his article titled "Crafting Strategy", Henry Mintzberg, another well known author on the subject of business strategy, indicates that a "key to managing strategy is the ability to detect emerging patterns and help them take shape. The job of the manager is not just to preconceive specific strategies but also to recognize their emergence."

Part I of the book is titled 'The New Game of Business' and describes the changes occurring in business which call for a new skill set. These changes are called Getting It, Polarization and Mindshare. Getting It refers to the ability of managers to become masters of pattern recognition. Instead of seeing chaos, these managers see the strategic pattern unfolding within the complexity, and discover the pattern behind it all. In short, they "get it". Polarization is the result of early recognition and exploitation of patterns in that the company that "got it" first realizes great momentum, its market value explodes and value is no longer proportional; it has polarized. Many examples are given such as Cisco vs. Bay Networks, Coca-Cola vs. Pepsi, and Nike vs. Reebok. Polarization means "winner takes all", and is spreading to other industries. The focus of competition in more and more industries is competition for mindshare, and is crafted as a three-part strategy: 1) mindshare with customers, 2) mindshare with investors and 3) mindshare with talent. Getting It, Polarization and Mindshare are critical skills in the war for dominance in an industry.

Part II of Profit Patterns describes thirty patterns that have affected business designs over the last two decades. The patterns are organized into the following categories:

o Mega - No Profit, Back to Profit, Convergence, Collapse of the Middle, De Factor Standard, Technology Shifts the Board

o Value Chain - Deintegration, Value Chain Squeeze, Strengthening the Weak Link, Reintegration

o Customer - Profit Shift, Microsegmentation, Power Shift, Redefinition

o Channel - Multiplication, Channel Concentration, Compression/ Disintermediation, Reintermediation

o Product - Product to Brand, Product to Blockbuster, Product to Profit Multiplier, Product to Pyramid, Product to Solution

o Knowledge - Product to Customer Knowledge, Operations to Knowledge, Knowledge to Product

o Organizational - Skill Shift, Pyramid to Network, Cornerstoning, Conventional to Digital Business Design

Numerous examples are given of the patterns, and case studies of successful companies such as Nokia, Dell, and Cisco Systems show how a company can detect patterns and trends, organize around them and create significant value, even polarization, from these patterns. The case studies, since all are well known companies, are very useful in understanding the patterns and comprehending how they can be applied in real-life business situations. This infrastructure of patterns can be used to organize and correlate the relevant experiences of well known corporations to your own organization. The patterns are equally applicable to large corporations or small-to-midsize companies.

Part III of Profit Patterns is called 'Putting Patterns to Work' and includes chapters on putting the patterns into action (company case studies), accelerated pattern detection, putting the patterns to work in your organization, and a patterns workbook. This is perhaps the most useful section of the book, in that it offers practical advice on applying the pattern thinking theories.

"Profit Patterns" is written in a practical, thorough, no-nonsense style and the theories are backed up with many real-world examples. I will definitely use the workbook section in the future to analyze business patterns and strategies. The authors are prolific, respected writers, and this book will become one of the staples of business literature. My only criticism is that the graphics are crude and unsophisticated and that a more professional approach to the graphics would lend more credibility and clarity to the concepts they illustrate.

Slywotzky and Morrison have accomplished something with this book that regular readers of business books would have thought impossible - they've applied intelligence and creativity to strategic buisness thinking and created a materpiece of originality and insight. Their categorization of business models into patterns based on their effects on either customers, distribution channels, products, knowledge, or organization is one of those flashes of insight that seems obvious only after someone has articulated it as clearly as Slywotzky and Morrison have done here. The clarity of expression and organization, and the case studies of real-world examples that illustrate the use of these patterns of business strategy and competition, make this a central holding of any serious business reader's library. Every management consultant, business owner or manager, or executive, should understand the business strategies outlined here.

This is not a book of answers. Nor is it a 'how to' book. It is a book of questions. These questions are intended to challenge you and your ways of doing business. It helps you to spot patterns for 'success' and 'failures' in different business situations by heightening your business awareness. Because the concepts of this book are written at the strategic level (as opposed to tactical level), most of the discussions are focused around general concepts and general trends. Overall, this book should be an invaluable reference guide.

I would rate this book highly recommended for business managers. It brings forth very good examples of how one can predict a new pattern is emerging and quickly change business strategy to get ahead of competitors.

The patterns presented are based on case studies. Therefore it is well illustrated. However, in the real world, it requires business managers to think deeply about their business to identify the pattern relevant to their business. So this book is good for a warm up exercise for your mind to get you into the mindset of pattern recognition.

This book will resonate with observers of the electronic marketing lanscape. Unprecedented fluidity of environment and ability to shape value packages are forcing e-marketing executives to take the same strategic view described in this book. In this new world, speed in identifying and responding to changing patterns in the marketplace is the key to leadership and profitability. However, this book takes these e-marketing lessons and applies them broadly, to a wide range of industries. It is an easy yet compelling read, which captures ideas that many executives will find familiar, once they see them here.

This book goes beyond Marketing, beyond Technology, its about when to apply specific knowledge to a specific situation. This Guys really are wizards of the business game!.

Really, very, very good........

PROFIT PATTERNS is a big book, but it is easy to read and understand. Yet, you can also use it as a daily reference tool when you come up against a problem that leaves you stymied. The workbook section at the end is especially valuable. CEOs regularly report that they have trouble finding new strategic business models. This book is just full of them, and uses a chess-playing analogy to help you understand the points very well. I strongly urge you to read this book. If your problems are in areas other than your strategic business model, you will also need to read and answer the questions in THE 2,000 PERCENT SOLUTION, which shows the way to get 20 times the normal results or the same results in 1/20 the time.

As a businessman looking for new opportunities, I'm constantly surveying different industries and examining their dynamics.

Profit Patterns provides a shorthand to look at a situation and have the strategic intuition to understand how it will play out.

Though many pages, about half are pictures that are not relevant - what is relevant are the 140 pages of patterns have advanced my thinking a great leap forward.

If you are involved in new business development of business strategy you'll be glad to have read this book.

What a visaully interesting book - in many ways a logical follow-on to The Profit Zone - such an interesting start to the book - using IBM's Deep Blue chess match against Kasparov to set the tone of discerning patterns to win - and then using photos of Picasso paintings to show how what was once clear is now exceedingly difficult to understand (in the new business models - as well as in Picasso's paintings). I thought the two previous books (Value Migration and The Profit zone) were outstanding business books that I use almost everyday in my consulting and teaching activities.