The secret to Amazon’s success in disruptive innovations

Throughout the last 4 years Amazon has reoriented itself towards a domain of activity which is very far from its original purview: it shifted from trading in e-commerce to cloud computing and is now the leader in this emerging market. What were the keys to its success?

With AWS (Amazon Web Services), the company offers computing power on demand to companies. AWS is the perfect solution for companies who need computing power and who do not want to invest in data centers. Voyages-SNCF.com (French train company) uses it to test new programs before they are released on its own website. Turbo Tax runs its tax declaration program, whose use is largely confined to a few intense days per year, on AWS. Facebook uses it to host thousands of online gamers.

2 simple ideas for success :

• Seizing an opportunity created by a technological disruption.
  Amazon understood the potential of cloud computing when four years ago nobody could predict whether the disruption would be a transient fashion or a major phenomenon.


• Betting on its internal potential.
  Thanks to its ability to process great volumes of transactions for the purpose of e-commerce, Amazon organised itself to make its composition available to other companies.

Questions that you must ask yourself :

This perfect example of a disruptive innovation strategy begs the following questions:

• Is there a technological disruption in your sector that paves the way for new innovations?
• Do you have abilities that may be of interest to clients outside of your usual market because of their level of excellency ?
• Are you ready to use these assets to create a new market?

The answer to these questions may be the beginning of a new period of growth for your company.

Comments

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[Taobao]

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[Edilane]

BrentonJanuary 12, 2012Check out the Fed's Beige Book, just released taeysrdey. A pretty dry read as well but might offer you a few hints to the true direction of the U.S. economy. I recommend looking up a few stats related to retail sales, consumer credit, and household spending over the last few months and use them to draw further implications from the reports in the Beige Book. Also, try to identify regional trends and trends in economic development on a basic scale in order to identify indicators of how the U.S. economy has evolved (or not) since 2008. If you do get around to reading even just a little then come talk to me and I can guarantee you a very interesting discussion!-B