Punching Above One’s Weight: Strategy Amplification
In the pages that follow, we describe how the outlier companies not only experiment with novelty but punch above their weight, or create outsized impact. How do companies amplify their strategy, and for example, achieve a significant impact despite limited resources? This is something that large companies need also to learn—how to use resource scarcity as a lever for innovation, not merely a limitation (Gibbert et al, 2007).
Rather than scaling up their strategy with large investments, vanguard outliers smartly and cost-consciously amplify their strategy and its global or inventive impact. We selected our case companies for their potential insights into such strategy amplification.2 Some, like Quirky, reached out to a community of inventors and thus used massive search for ideas through inclusiveness as an amplifier. Grow VC Group, a pioneer in finance, is another example where building a novel contributor architecture enables disproportionate potential competitive advantage. Taking modularity to the extreme of plug and play provides amplification for Shapeways in rapid design and manufacturing of industrial products. And of course, doing something so radical that the costs plummet, like in the case of Organovo and its revolutionary contribution to clinical drug trials (providing 3D-printed cell tissue replacing the need for testing on living animals or humans), is a tried and true amplification strategy applied first by outliers in ways not conceivable before. An organizational design fostering generativity for problem solving could be an amplifier when used skillfully to invite people to address the issue from different angles and then to build on these multiple perspectives and adjacent ideas. Robin Hood Minor Asset Management Coop is generative in its approach for redefining, and democratizing access to equity.3 Kaggle is highly generative in inviting leading scientists and amateurs to compete on big data problem solving and develop new solution approaches.
In Chapter 2, we introduce the theoretical and methodological perspectives that support our study. In Chapter 3, we offer the Workbook which includes tools for facilitating learning from the cases and, broadly speaking, from novelty and outlier organizations. Then, in the chapters that follow, the cases, some with commentaries from the CEOs, founders or analysts, and participants in organizational activities, are presented in the order of their strategic novelty, or how far out we deem their business model innovation to be from the current mainstream. We start with Fondia, a new kind of a legal firm, and end with Robin Hood Minor Asset Management Cooperative that is in the process of launching its own synthetic finance instruments based on Blockchain technology (an emergent Internet technology for transacting records). Bang & Olufsen, a 90-year old high-tech, high-design sound system veteran, provides a final incumbent perspective on strategic renewal. We conclude with a reference summary of the cases and an outlook for the strategist.