Celebrating the Phoenix

In the book I am writing, I have identified a number of industries where companies got demolished by tech savvy competitors (Blockbuster, Borders and many more).  But my research also highlights plenty of companies which have reinvented themselves with technology or have commercialized technology which did not succeed in the first go-around.

Exhibit A is of course Apple. In 1997, shortly after Steve Jobs returned to Apple, Dell’s founder and chairman, Michael S. Dell, was asked at a technology conference what might be done to fix Apple, then deeply troubled financially.

“I’d shut it down and give the money back to the shareholders.”

A decade later Apple was valued more than Dell, and has since gone on to even higher heights.

GoGo, the Wi-Fi service being offered by many US airlines leverages Aircell’s experience around airphones we had in most seatbacks in the 90s. Aircell paid the FCC a few years ago about $ 30 million to acquire licenses for the air-to-ground frequencies. The air-to-ground is a big difference from the satellite services Row 44 (that Southwest utilizes) and others are rolling out. Planes transmit via underbelly blade antennae to 92 cell towers that can be accessed around the country and up to about 100 miles over international waters. In the long run, with numbers starting to build nicely (such as 1 GB of data per flight), the licenses may turn out to be one of the best investments they have made – and they are leveraging previous investment in the towers.

Delta Airlines has had a roller coaster ride along with the rest of the airline industry. In its heyday, the Delta Red Coat was a symbol of exemplary customer service – authorized to do all kinds of favors for passengers. Delta has reintroduced the Red Coat this time armed with Motorola handhelds to “help them more efficiently assist passengers, directing those who’ve missed a connection to their new flight, for example, securing boarding passes or even providing food vouchers if there is a need.” Delta has also leveraged GoGo above aggressively. With more than 2,200 flights daily, Delta operates the largest fleet of Wi-Fi enabled aircraft in the world. In addition to convenient flight times and air fares, the availability of Wi Fi is a growing decision criterion for many passengers and it provides Delta a significant competitive advantage. It was one of the first airlines to leverage Facebook for on-line check-ins. At selected airports, Delta has worked with franchisees to operate restaurants that are physically located in the gatehouse area and use iPads for customers to place orders. These same devices are free for customers to use to surf the internet. This new “digital experience” is allowing Delta a fighting chance to regain its past glory.

The GM On Star telematics with navigation and emergency services were a significant differentiator for its cars a decade ago. Then the world moved to Garmin and other hand held GPS units, and to Google Maps on our smart phones. GM is introducing On Star FMV as a rear view mirror and on an annual fee basis so even Toyota and Ford customers can avail of it.

Corning has shown a remarkable ability to go back into its vaults and repurpose technology which was once ahead of its time. So the basic composition in its fiber-optics had been available since the 1930s but the market really took off in the 1990s when telecom companies started replacing their copper networks. Gorilla Glass, its very successful product for consumer electronic displays and on a billion dollar run rate this year, had its inspiration from strengthened glass Corning had developed in the 1960s.

As the US Postal Service looks to reinvent itself it will find inspiration in a number of European peers. From BusinessWeek “Itella, the Finnish postal service, keeps a digital archive of its users’ mail for seven years and helps them pay bills online securely. Swiss Post lets customers choose if they want their mail delivered at home in hard copy or scanned and sent to their preferred Internet-connected device. Customers can also tell Swiss Post if they would rather not receive items such as junk mail. Sweden’s Posten has an app that lets customers turn digital photos on their mobile phones into postcards. It is unveiling a service that will allow cell-phone users to send letters without stamps.”

It’s normal for us to celebrate startups, but many old companies have tricks up their sleeves and can rise from their ashes. Ignore them at your peril.

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CEO of Deal Architect, a top advisory boutique recognized in The Black Book of Outsourcing, author of a widely praised book on technology enabled innovation, The New Polymath, prolific blogger, writing about technology-enabled innovation at New Florence, New Renaissance and about waste in technology at Deal Architect.  Previously Analyst  at Gartner, Partner with PwC Consulting. Keynoted at many business and technology conferences and has been quoted in the Wall Street Journal, BusinessWeek, The Financial Times, CIO Magazine, and other executive and technology publications.