- Subject: Strategic Management. - Mandatory book for this week's assignment (file attached - please include in citations): Rothaermel, F. T. (2013). Strategic management: Concepts. New York: McGraw-

E ssay # 1: R efle ctin g h ig her v a lu e c re atio n b ase d o n it s d if f e re ntia tio n s tr a te gy, P &G

genera lly c h arg es a 2 0 – 4 0 p e rc e n t p re m iu m fo r it s p ro ducts in c o m paris o n to r e ta ile rs ’

p riv a te -la bel b ra nds. F or in sta n ce , a 1 50 o z. c o n ta in er o f liq uid T id e d ete rg ent is $ 18 a t

Ta rg et, w hile th e r e ta ile r’s p riv a te -la bel b ra nd is p ric e d a t $ 15. G iv e n r e ce nt

re ce ssio nary p re ssu re s o n d is p o sa b le h ouse h old in co m es, m an y c o nsu m ers s w it c h ed

to p riv a te -la bel b ra nds th at th ey fe lt d id ju st a s fin e a jo b. N ot o nly h as P &G lo st m ark e t

sh are b eca use o f it s h ig her p ric e s to c o n su m ers ; it s p ro fit m arg in s h ave a ls o b een

sq ueeze d b y r is in g c o sts o f in put fa cto rs .

O ne u nderly in g p ro ble m th at P & G is fa cin g is th at r a th er th an c re atin g n ew p ro duct

ca te gorie s th at it is fa m ous fo r, it is tw eakin g e xis tin g p ro ducts in cre m enta lly . P &G ’s

r e ce nt m ajo r p ro duct b re akth ro u ghs s u ch a s S w if f e r c le anin g d evic e s a nd s u pplie s,

C re st Wh it e str ip s, a nd F ebre ze o dor fr e sh e ners w ere a ll la unch ed o ve r a d eca de a go.

In a n a tte m pt to b rin g in m ore in nova tio n fr o m th e o uts id e th ro ugh it s C onnect+ D eve lo p

in it ia tiv e , P &G h as s la sh ed it s R &D s p e ndin g in r e ce n t y e a rs b y a s m uch a s 5 0 p erc e nt,

a nd is n ow s p endin g le ss th an s o m e o f it s r iv a ls . T he C onnect+ D eve lo p in it ia tiv e w as

put in p la ce b y A . G . L afle y d urin g h is fir s t te rm a s P &G ’s C EO .

Questio ns

1. P &G is p urs u in g a d if f e re ntia tio n s tr a te gy. L ookin g a t th e v a lu e a nd c o st d riv e rs

d is cu sse d in th is c h apte r a nd th e ta ble e ntit le d “ C om pe tit iv e P osit io nin g a nd th e

F iv e F orc e s: B enefit s a nd R is ks o f C ost- L eaders h ip a nd D if f e re ntia tio n B usin ess

S tr a te gie s” in F ig -1 3, id entif y th e fa cto rs c a u sin g P & G ’s b usin ess s tr a te gy to lo se

it s lu ste r. Wh y is P &G ’s d if f e re ntia tio n s tr a te gy n o lo nger a s p ote nt a s it o nce w as? Fig ure 1 3

2. G iv e n th e d is cu ssio n in th e C ase a bout P & G s la sh in g it s R & D s p endin g a nd

cu ttin g c o sts a nd jo bs m ore g en era lly , d oes th e fir m r is k b ein g “ s tu ck in th e

m id dle ”? Wh y o r w hy n ot? If y e s, w hy w ould b ein g “ s tu ck in th e m id dle ” b e a b ad

str a te gic p osit io n?

3. Y our ta sk is to h elp M r. L afle y s h arp en P & G ’s s tr a te gic p osit io n. W hic h s tr a te gic

p osit io n a lo ng th e p ro ductiv it y f r o ntie r s h o uld P & G s ta ke o ut? W hic h v a lu e a nd/ o r

co st d riv e rs w ould y o u fo cu s o n to im pro ve P & G ’s s tr a te gic p ro file ? H ow w ould

y o u g o a bout it ? Wh at r e su lt s w ould y o u e xp e ct?

E ssay # 2: A lm ost e ve ry o ne in C hin a k n ow s L i N in g C om pa ny L td . T he e ponym ous

sp orts w ear c o m pany w as fo unded in 1 990 b y fo rm er s ta r g ym nast L i N in g, w ho w on s ix

m edals ( in clu din g th re e g old ) a t th e 1 984 L os A ngele s O ly m pic s. R id in g o n th e fa m e o f

it s fo under, L i N in g q uic kly b eca m e th e la rg est a nd b est- k n o w n C hin ese s p orts w ear

co m pany. In p ara lle l w it h C hin a’s in cre dib le e co n om ic r is e , L i N in g d id e xce ptio nally

w ell.

T he c o m pany d ecid ed th at th e 2 008 O ly m pic s in B eijin g w ould m ark th e b egin nin g o f

ove rta kin g th e w orld le aders in s p o rts s h o es a nd a ppare l, N ik e a nd A did as. T his w ould

h appen fir s t in th e C hin ese m ark e t a nd th en g lo bally . T o s ym bo liz e th e c o m pany r is e , it s fo under L i N in g, s till a p opula r fo lk h ero w as c h o se n to lig ht th e O ly m pic fla m e d urin g

th e B eijin g o penin g c e re m onie s. W it h it s h om e tu rf a dva n ta ge, e ve ry th in g s e em ed to b e

goin g in L i N in g’s fa vo r. In M arc h 2 013, h ow eve r, L i N in g s h o cke d th e b usin ess w orld

b y a nnouncin g a w ors e -th an-e xp e cte d a nnual lo ss o f $ 315 m illio n. T his w as L i N in g’s

f ir s t e ve r lo ss s in ce g oin g p ublic in 2 004. J u st tw o y e a rs e arlie r in 2 010, L i N in g

re porte d a ll- tim e-h ig h r e ve nue o f $ 1.5 b illio n, w it h $ 182.3 m illio n in n et in co m e. W hat

happened?

Li N in g’s s tr a te gic in te nt h ad b e en fr o m th e v e ry b egin nin g to o ve rta ke N ik e a nd

A did as. T he B eijin g O ly m pic s w ere to b e th e tu rn in g p oin t in th is “ e pic b attle ” fo r m ark e t

dom in ance . In a ntic ip atio n o f th e e norm ou s b usin ess o pportu nit ie s th at w ould c o m e

wit h th e 2 008 B eijin g O ly m pic s, L i N in g p ush e d it s p enetr a tio n in to C hin a’s s e co nd- a nd

th ir d -tie r c it ie s v ia a ggre ssiv e c h a nnel e xp a nsio n th ro ugh it s d is tr ib uto rs , a ddin g a lm ost

1 ,0 00 s to re s a y e ar ( F ig -1 4). In 2 008 a nd 2 009 a lo ne, m ore th an 8 0 p erc e nt o f th e n ew

sto re s w ere o pened in C hin a’s s e co n d-a nd th ir d -tie r c it ie s.

F ig ure 1 4

C hin a’s r a pid u rb aniz a tio n a nd t h e p ost- O ly m pic s e ff e cts e ch o ed L i N in g’s v is io n: fr o m

2005 to 2 010, L i N in g tr ip le d it s r e ve n ue a nd s e e m ed to b e o ve rta kin g A did as to

b eco m e n um ber tw o in th e C hin e se m ark e t, ju st b ehin d N ik e ( F ig -1 5). F uele d b y

se em in gly u nsto ppable s u cce ss, L i N in g b egan to e xp a nd in S outh east A sia . In a

b ra ze n m ove , L i N in g e ve n o pen ed a s p e cia lt y s to re a cro ss th e P acif ic in P ortla nd,

O re gon, th e h om eto w n o f N ik e . Fig ure 1 5

Li N in g s o on fo und th at it s lo ca l C hin ese c o m pe tit o rs w ere p urs u in g a s im ila r e xp ansio n

str a te gy. T o m ake m atte rs w ors e , e ve n N ik e a nd A did as jo in ed th e fr a y to c o m pete

a ggre ssiv e ly in s e co nd- a nd th ir d -tie r c it ie s. T his w as a d epartu re fr o m th e u su al

busin ess m odel w here th e tw o w orld le aders w ould fo cu s o n h ig h-e nd m ark e ts s u ch a s

S hanghai a nd B eijin g. A s th e p ost- O ly m pic s h o ppin g e nth usia sm g ra dually fa ded,

co m petit io n fu rth er in te nsif ie d. R ea liz in g th at th e e xp a nsio n-fu ele d g ro w th w as n ot

su sta in able , L i N in g b egan fin e-tu nin g it s b usin ess m od el: c o n so lid atin g d is tr ib uto rs ,

u pgra din g p ro duct o ff e rin gs, a n d fo cu sin g o n s e rv in g h ig her-e nd m ark e ts a nd y o unger

co nsu m ers . L i N in g e ve n c h ange d it s lo go a nd s lo gan to p ro m ote th e n ew im age.

A lm ost o ve rn ig ht, L i N in g’s b ra nd m ark e tin g c a m pa ig n s w ep t C hin a’s a ir w ave s, to w ns,

a nd c it ie s.

D esp it e it s b est m ark e tin g e ff o rts , L i N in g’s in ve n to ry k e p t p ilin g u p. A gain st th e

backd ro p o f d eclin in g s a le s, L i N in g’s c a sh flo w s o o n d ra in ed. G iv e n it s fin ancia l

sq ueeze , L i N in g h ad to r a is e fu nd s fr o m a p riv a te e quit y g ro up a nd th e G ove rn m ent o f

S in gapore In ve stm ent C orp ora tio n. T his le d to a s h a ke -u p o f L i N in g’s b oard o f

dir e cto rs , w hic h s u bse quently p ut a n ew to p m an agem en t te am in p la ce . T he to p

prio rit y o f th e n ew m anagem en t w as to ta ckle L i N in g’s in ve n to ry p ro ble m s. Its

m anagem ent to ok s e ve ra l d ra stic s te ps to r e viv e th e s a le s c h a nnel b y fr e ein g u p

dis tr ib uto rs ’ c a sh flo w s fo r in tr o du cin g n ew p ro ducts . D is tr ib uto rs w ere fu rth er

co nso lid ate d a nd L i N in g a dded m ore fa cto ry o utle ts a nd d is co unt s to re s to s p eed u p

in ve nto ry c le ara nce . A ll s to re s u n derw ent c a re fu l p erfo rm an ce e va lu atio n. E ve ntu ally , L i

N in g c lo se d 1 ,8 21 u nderp erfo rm in g s to re s. In a ddit io n, L i N in g s ta rte d im ple m entin g a tr a ns-fo rm atio n p la n to g ra dually s h if t a w ay fr o m th e d is tr ib uto r-d riv e n b usin ess m odel

to a m ark e t- o rie nte d o ne. In th e p ast, L i N in g’s d is tr ib uto rs m ad e o rd ers b ase d o n th eir

o w n ju dgm ent o f r e ta il d em and s ix m on th s a head a t q uarte rly tr a de fa ir s , a nd s o L i N in g

w ould a rra nge p ro ductio n, d eliv e rie s, a nd m ark e tin g c a m pa ig ns. U nder th e n ew p la n, L i

N in g in tr o duce d “ A 1 ” S to ck K ee pin g U nit s ( S KU s), a s w ell a s c u sto m er g ro up-s p ecif ic

S KU s, h elp in g d is tr ib uto rs m ake s o u nd o rd erin g d ecis io ns. O nce th ese S KU s h it th e

sto re s, L i N in g w ould c o lle ct a nd m on it o r r e al- tim e s a le s d ata a nd m ake in ve nto ry

a dju stm ents a cco rd in gly . L i N in g la unch e d fa st- re sp o nse p ro ducts th at c o uld e asily b e

ord ere d in b etw een tr a de fa ir s in r e sp o nse to c h a nges in m ark e t tr e nds. It a ls o

re desig ned p ro duct lin es a nd c h a nged p ric in g b ase d o n th e n eeds o f it s ta rg et

cu sto m ers , w hic h h ad n ot b een c le arly d efin ed b efo re .

T he n ew m anagem ent te am a t L i N in g b elie ve d th at th ere w as a b ig m ark e t b etw een

th e h ig her-e nd N ik e a nd A did as, o n th e o ne h and a nd m ost o f th e lo w -e nd lo ca l b ra nds,

o n th e o th er. N ew p ro ducts w it h a w id er p ric e r a nge w ould b e la unch ed to c a ptu re th e

co nsu m er in th e “ m id dle .” L i N in g ’s tr a nsfo rm atio n is n oneth ele ss c o stly : r e ve nue in

2 012 d eclin ed b y a w hoppin g 2 5 p erc e n t to $ 1 b illio n ( v e rs u s $ 26 b illio n fo r N ik e a nd

$20 b illio n fo r A did as). L i N in g’s m ark e t s h a re r a nkin g in C hin a h as d ro pped to n um ber

fo ur fr o m n um ber th re e ( n ow h eld b y a lo ca l c o m pe tit o r, A nta ). T o a vo id b ankru ptc y, L i

N in g h ad to a sk fo r a noth er r o un d o f liq uid it y in je ctio n b y it s r e ce nt b acke rs .

L i N in g’s p ro ble m o f o ve re xp an sio n is n ot u niq ue. S lo w in g s a le s a nd h ig h in ve nto rie s

have b urd ened o th er s p orts w ea r b ra nds in C hin a, in clu din g N ik e a nd A did as. T he tw o

glo bal b ra nds h ave g ain ed b ack th eir m ark e t s h a re s, p re su m ab ly a t L i N in g’s e xp ense .

N ik e a nd A did as w ere fa ste r in r e sp o ndin g to c h a nges in th e m ark e t e nvir o nm ent. T hey

als o fu rth er d if f e re ntia te d th em se lv e s fr o m th e p ack th ro ugh c o n tin ued in nova tio n a nd

so phis tic a te d m ark e tin g. F or e xa m ple , A did as in tr o duce d fa sh io nable s p orts w ear s u ch

a s h ig h-h eele d s p orts s h oes in C hin a.

T he o nly s p orts w ear b ra nd in C hin a to p ost p osit iv e g ro w th in 2 012 w as A did as, a nd it

s e em s b est p osit io ned to g ain fr o m th e c o u ntr y ’s $ 24 b illio n s p o rts w ear b usin ess, w hic h

is e stim ate d to g ro w a t 1 5 to 2 0 p erc e n t fo r th e n ext th re e y e a rs . In c o ntr a st, L i N in g is

i n d eep d ow nsiz in g m ode: s to re s, d is tr ib uto rs , a nd b usin ess s e g m ents a re a ll u p to b e

cu t in 2 013. Its p ro ud P ortla nd v e ntu re a nd o th er o ve rs e a s s to re s a re lo ng g one, a nd

th e c o m pany is n ow r e fo cu sin g o n th e C hin ese m ark e t o nly .

Q uestio ns

1. A t th e c lo se o f th e c a se , w hy w as L i N in g e xp e rie ncin g a c o m pe tit iv e

d is a dva nta ge?

2. Wh at a re th e s tr a te gic p osit io ns o f N ik e , A did as, a nd L i N in g? D o y o u s e e a lin k

betw een s tr a te gic p osit io n a nd fir m p erfo rm an ce ? If s o , w hat e xp la in s th at lin k?

3. Wh y is it s o d if f ic u lt fo r L i N in g t o c h a lle nge N ik e a nd A did as e ve n in C hin a? W ould

y o u e xp ect th at th e C hin ese c o nsu m er w ould b e m ore lo ya l to a C hin ese b ra nd?

Wh at m ove s c o uld th e c o m pan y m ake th at w ould b uild c u sto m er lo ya lt y ? W hat re co m mendatio ns w ould y o u g iv e L i N in g to a ch ie ve a s u cce ssfu l tu rn aro und?

E xp la in .

E ssay # 3: In th e e nvis io ned tr a nsit io n a w ay fr o m g aso lin e-p ow ere d c a rs , N is sa n’s C EO

C arlo s G hosn fir m ly b elie ve s th e n ext te ch n olo gic a l p ara dig m w ill b e e le ctr ic m oto rs .

M r. G hosn c a lls h yb rid s a “ h alf w ay te ch n olo gy” a nd s u g gests th ey w ill b e a te m pora ry

p henom enon a t b est. A n um ber o f s ta rtu p c o m pa nie s, in clu din g T e sla M oto rs in th e

U nit e d S ta te s a nd B YD in C hin a, s h a re G hosn ’s b elie f in th is fu tu re s ce nario .

O ne o f th e b ig gest r e m ain in g im pedim en ts to la rg e-s ca le a doptio n o f e le ctr ic v e hic le s,

h ow eve r, is th e la ck o f a ppro pria te in fr a str u ctu re : T here a re fe w s ta tio ns o n th e r o ads

w here d riv e rs c a n r e ch arg e th e ir c a r’s b atte ry w hen n ece ssa ry . W it h th e m ile age r a nge

of e le ctr ic v e hic le s c u rre ntly lim it e d to s o m e 2 00 m ile s, m an y c o nsid er a la ck o f

re ch arg in g s ta tio ns a s e rio us p ro ble m ( s o c a lle d “ ra nge a nxie ty ”). T e sla M oto rs a nd

oth ers , h ow eve r, a re w ork in g h ard to d eve lo p a n etw ork o f s u p erfa st c h arg in g s ta tio ns.

N is sa n’s M r. G hosn b elie ve s e le ctr ic c a rs w ill a cco unt fo r 1 0 p erc e nt o f g lo bal a uto

s a le s o ve r th e n ext d eca de. In c o ntr a st, T o yo ta is c o n vin ce d g aso lin e-e le ctr ic h yb rid s

w ill b eco m e th e n ext d om in ant te ch n olo gy. T hese d if f e re nt p re dic tio ns h ave s ig nif ic a nt

in flu ence o n w hat te ch nolo gy th e y d ecid e to b ack a nd h ow m uch m oney N is sa n a nd

To yo ta in ve st in th at te ch nolo gy. N is sa n’s fu lly e le ctr ic v e h ic le , th e L eaf ( a n a cro nym fo r

Leadin g, E nvir o nm enta lly fr ie ndly , A ff o rd able , F am ily c a r), b uilt a t a p la nt in S m yrn a,

Te nnesse e, w as in tr o duce d in 2 01 0 in J a p an a nd in 2 011 in E uro pe, th e U S, a nd

C anada. A s o f 2 013, th e N is sa n L eaf is th e b est- s e llin g a ll- e le ctr ic c a r, w it h g lo bal s a le s

of s o m e 1 00,0 00 u nit s .

To yo ta is e xp andin g it s R &D in ve stm en ts in h yb rid te ch n olo gy. T o yo ta h as a lr e ady s o ld

s o m e 4 m illio n o f it s p opula r P riu s c a rs s in ce th ey w ere fir s t in tr o duce d in 1 997. B y

2020, T o yo ta p la ns to o ff e r h yb rid te ch n olo gy in a ll it s v e h ic le s. E ve ntu ally , th e

in ve stm ents m ade b y N is sa n a nd T o yo ta w ill y ie ld d if f e re nt r e tu rn s, d ependin g o n w hic h

p re dic tio ns p ro ve m ore a ccu ra te .

A n a lt e rn ativ e o utc o m e is th at n e it h er h yb rid s n or e le ctr ic c a rs w ill b eco m e th e n ext

p ara dig m . T o a dd e ve n m ore u nce rta in ty to th e m ix , H onda a nd B M W a re b ettin g o n

ca rs p ow ere d b y h yd ro gen fu el c e lls . In s u m , m an y a lt e rn ativ e te ch nolo gie s a re

c o m petin g to b eco m e th e w in ner in s e ttin g a n ew s ta ndard fo r p ro pellin g c a rs . T his

s it u atio n is d epic te d in F ig -1 6, w here th e n ew te ch n olo gie s r e pre se nt a s w arm o f n ew

entr ie s v yin g fo r d om in ance . O nly tim e w ill te ll w hic h te ch n olo gy w ill w in th is s ta ndard

b attle . Fig ure 1 6

Q uestio ns

1. D o y o u b elie ve th at th e in te rn al c o m bu stio n e ngin e w ill lo se it s d om in ant p osit io n

in th e fu tu re ? Wh y o r w hy n ot? W hat tim e h oriz o n a re y o u lo okin g a t?

2. Wh ic h fa cto rs d o y o u th in k w ill b e m ost c rit ic a l in s e ttin g th e n ext in dustr y s ta ndard

fo r te ch nolo gy in c a r p ro puls io n? D o y o u b elie ve it is p ossib le th at th e n ew

te ch nolo gie s c a n c o exis t, o r d o y o u th in k th ere w ill b e o nly o ne in dustr y s ta ndard ?

3. Wh ic h c o m panie s d o y o u th in k a re c u rre ntly b est p osit io ned to in flu ence th e n ext

in dustr y s ta ndard in c a r-p ro puls io n te ch n olo gy?

4. Wh at w ould y o u r e co m mend d if f e re nt c o m pe tit o rs ( e . g ., G M , T o yo ta , N is sa n, a nd

Te sla M oto rs ) d o to in flu ence th e e m erg in g in dustr y s ta ndard ?

E ssay # 4: WI KIP ED IA , le ve ra ges te ch nolo g ic a l in nova tio n a ff o rd ed b y th e In te rn et

co m bin ed w it h a c ro w dso urc in g a ppro ach to c o n te nt d eve lo pm ent a nd m ain te nance .

B eyo nd th e te ch nic a l c h alle nges o f w eb in te rfa ce s, s e rv e rs , a nd b andw id th fo r d eliv e ry

is a s o m etim es-o ve rlo oke d c a pa bilit y : th e W ik ip edia ns th em se lv e s. O ve r 3 2 m illio n

people h ave r e gis te re d a cco unts to c o n tr ib ute e dit s to W ik ip edia . M ore th an 3 00,0 00

use rs p ro vid e e dit s to th e w ebsit e a t le ast o nce a m on th . T hese v o lu nte ers b uild th e

co nte nt fo r th e s it e , u sin g a c re ativ e c o m mons lic e n se th at e nsu re s fr e e a cce ss to a ny of th e 5 00 m illio n u niq ue v is it o rs e ach m on th . T his c ro w dso u rc in g a nd it s le gal

underp in nin gs a re s u cce ssfu l o nly a s lo ng a s in div id uals a re w illin g to s p end th eir o w n

tim e c o ntr ib utin g to th e s it e fo r n o p ay o r o th er e xtr in sic b enefit s . T he a bilit y to a ttr a ct

a nd u tiliz e le gio ns o f in te re ste d in div id uals is v it a l to th e s u cce ss o f W ik ip edia b oth

t o day a nd in to th e fu tu re .

M ore ove r, Wi kip edia is a n onpro fit , fr e e-o f- a dve rtis in g s o cia l e ntr e pre neurs h ip v e ntu re

th at is e xclu siv e ly fin ance d b y d o natio ns. W ik ip edia r u ns r e gula r c a lls fo r d onatio ns

usin g s lo gans s u ch a s: “ P le ase h elp u s fe ed th e s e rv e rs ,” “ W e m ake th e In te rn et n ot

su ck. H elp u s o ut,” a nd “ W e a re fr e e, o ur b andw id th is n ’t !” C alls fo r d onatio ns a ls o

c o m e in th e fo rm o f p ers o nal a p peals b y c o -fo under J im my W ale s. T he q uestio n a ris e s

w heth er th e d onatio n m odel is s u sta in able g iv e n n ot o nly th e in cre asin g d em and fo r

Wi kip edia ’s s e rv ic e s, b ut a ls o th e e m erg ence o f c o m pe tit o rs .

Wi kip edia m ig ht n ot b e a s e rro r-p ro ne in s cie nce to pic s a s s h o w n in th e N atu re s tu dy

m entio ned e arlie r, b eca use m ost e ntr ie s o n W ik ip edia a re n ot a bout s cie nce . W ik ip edia

m ain ta in s th at it fo ste rs a “ n eutr a l p oin t o f v ie w .” A r e ce n t r e se a rc h s tu dy te ste d th is

c la im . In p artic u la r, a s tu dy o f 2 8,0 00 a rtic le s a bout U S p olit ic s r e ve ale d a s ig nif ic a nt

bia s. O n a ve ra ge, Wi kip edia e ntr ie s le an le ft o f c e n te r. In it ia l e ntr ie s a rriv e w it h a s la nt,

a nd c h ange lit tle o ve r tim e. T his b ia s is m ore p ro nounce d in e arlie r W ik ip edia a rtic le s.

T he a uth ors c a ll th is th e “ v in ta g e b ia s.” A lt h ough th e d egre e o f s la nt in W ik ip edia

a rtic le s c h anges lit tle o ve r tim e, m ore r e ce n t p olit ic a l e ntr ie s a re m ore b ala nce d. O ne

re aso n th e a uth ors p ut fo rth to e xp la in th e v in ta ge e ff e ct is th at in th e e arly d ays o f

Wi kip edia o nly te ch nolo gy e nth u sia sts a nd e arly a dopte rs p artic ip ate d, a nd th is

d em ogra phic te nds to le an le ft. T he s h if t to w ard a m ore “ n eutr a l p oin t o f v ie w ” o ve r th e

ye ars h as a ris e n fr o m th e g ro w th o f W ik ip edia , b rin gin g in th e e arly a nd la te m ajo rit y a s

co ntr ib uto rs .

Q uestio ns

1. H ow c a n Wi kip edia m ain ta in a nd g ro w it s a bilit y to h arn ess th e c ro w dso urc in g o f

it s “ Wi kip edia ns” to m ain ta in h ig h -q ualit y ( a nd q uic kly u pdate d) c o nte nt?

2. A s Wi kip edia k e eps g ro w in g, d o y o u th in k it c a n c o n tin ue to r e ly e xclu siv e ly o n

donatio ns ( in tim e a nd m oney)? W hy o r w hy n ot? W hat o th er “ b usin ess m odels ”

c o uld b e c o nsid ere d? W ould a ny o f th ose “ v io la te th e s p ir it o f W ik ip edia ”? W hy o r

w hy n ot?

3. Wh at, if a nyth in g, s h ould Wi kip ed ia d o to e nsu re th at it s a rtic le s in deed p re se nt a

“ n eutr a l p oin t o f v ie w ”? S hould n’t th e c ro w dso u rc in g a ppro ach e nsu re o bje ctiv it y ?

D oes a “ n eutr a l p oin t o f v ie w ” m atte r to W ik ip edia ’s s u sta in abilit y ? W hy o r w hy

not?

4. H ow h as th e “ lo ng ta il” a ff e cte d W ik ip edia ?

E ssay # 5: T he c h apte r d is cu sse d th e In te rn et a s a d is ru ptiv e in nova tio n th at h as

fa cilit a te d o nlin e r e ta ilin g. It a ls o , h ow eve r, h as p re se n te d c h a lle nges to b ric k-a nd-

m orta r r e ta ile rs . H ow m ig ht r e ta ile rs s u ch a s N ord str o m , N eim an M arc u s, o r M acy’s

n eed to c h ange th eir in -s to re e xp erie nce in o rd er to c o n tin ue to a ttr a ct a flo w o f cu sto m ers in to th eir s to re s to e xp and s a le s u sin g d ir e ct s e llin g a nd s to re d is p la ys o f th e

actu al m erc h andis e ? If th e In te rn et c o n tin ues to g ro w a nd s a le s o f b ric k-a nd-m orta r

re ta ile rs d eclin e, h ow m ig ht th e r e ta ile rs a ttr a ct, tr a in , a nd r e ta in h ig h-q ualit y e m plo ye es

if th e in dustr y is p erc e iv e d a s in d eclin e?