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Business Plan Should Answer

 

From HBR, By William A. Sahlman 

When I receive a business plan, I always read the résumé section first. Not because the people part of the new venture is the most important, but because without the right team, none of the other parts really matters. 

 Fourteen “Personal” Questions Every Business Plan Should Answer 

• Where are the founders from? Where have they been educated? 
• Where have they worked—and for whom? 
• What have they accomplished—professionally and personally—in the past? 
• What is their reputation within the business community? 
• What experience do they have that is directly relevant to the opportunity they are pursuing? 
• What skills, abilities, and knowledge do they have? 
• How realistic are they about the venture’s chances for success and the tribulations it will face? 
• Who else needs to be on the team? 
• Are they prepared to recruit high-quality people? 
• How will they respond to adversity? 
• Do they have the mettle to make the inevitable hard choices that have to be made? 
• How committed are they to this venture? 
• What are their motivations? 

Source: HBR

5G Evolution and Positioning to Sell

 5G Evolution and Positioning to Sell   

IT Economics for Business - II

Real Options Valuation (ROV):
A complex technique than TCO, ROI and EVA. It is based on the financial estimation techniques used in stock options theory. ROV is used to modify the ROI calculation by considering the value that the current project could contribute to future projects. This approach typically enhances the ROI of projects such as IT infrastructure. The cost of implementing a whole new infrastructure for just one project for one business unit’s needs is so burdensome that no one business unit could ever justify starting the new infrastructure. However, the overall value of the new infrastructure to all the business units in the organization could be huge. ROV provides a technique for justifying that first project based on the future derived value.

Return on Assets (ROA):
A popular measure for the performance of companies, ROA can also be applied specifically to IT assets.ROA for IT assets can be calculated by isolating the IT-specific assets from the organisational assets and the net income due to IT assets from the overall net income. This can be hard to do, and the accounting systems need to be set up appropriately to provide any chance of achieving this on a repeatable basis. ROA approach has deeper implications than might be immediately obvious.

 Return on Infrastructure Employed (ROIE):
 ROIE is similar to ROA, but it focuses on IT services rather than IT assets. With ROIE, IT service cost (including depreciation) is the basis for computing a return. While ROIE can be used for a single project, it works best when calculated for aggregations of projects. For example, it might be used to compare the performance of different in-house or outsourced IT Providers. ROIE might be improved by providing the same IT service at a lower cost or by containing the cost growth of providing a particular IT service to less than the rate at which the organisation’s net income is growing.

Part 1 is here

Source/Credit: The Business Value of IT

Business Performance Framework

Credit: Gartner

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Top 4 Probable Digg Buyers

Rumours are hot again about Google/Microsoft planning to buy Digg. When I wrote about Top5 probable Digg buyers in 2006 it was a rumor, but this time reports coming out suggest that this time Kevin Rose might sell it, esp when the stock market is going down and the US is technically in recession. The only difference between now and then is, that one of the suggested 5 players, Yahoo itself is in trouble. So only 4 players remain in the race and these are :
1. News Corp
2. Time Warner
3. Microsoft
4. Google

I'm quoting from my previous post here with some modifications on why these 4 players are after Digg:

News Corporation - Newscorp would love to have this esp; after their acquisition myspace has lost traffic/users and momentum to Facebook. And as a media company it makes sense to have the most popular portal for news/technology/current affairs to be in their armour.

Microsoft - Microsoft will be the obvious choice because Microsoft is lagging in this Web 2.0 phenomenon. There hasn't been any decent/buzzing service offering by Microsoft in this space. If this comes on board, it will provide them a kick-start, which they are hoping for a while. Microsoft has got all the ingredients the to make this happen. Only problem i see is they are offering less money than what Google is offering and they are tied with Yahoo acquisition.

Time Warner - Time warner group which own Netscape will be other contender. Netscape has launched their portal on digg style but is not popular as digg is. Netscape previously asked top digg contributors to join and get paid for their contribution. Netscape would definitely like to acquire this.

Google - If nobody can buy digg than Google will definitely try. It will be more of a strategic move, to not to allow, Microsoft or News corp to buy this. Google can pull this off. Also Kevin Rose would love to be part of Google rather than Microsoft.

I can think of only these 4 contenders, what do you think? is there any other company (media) that might be interested in?

Unholy alliance - Microsoft, Novell partnership

Microsoft has announced its partnership with Novell to put Suse Linux (2nd no Linux distro) on a Windows desktop. As part of the deal, Microsoft will offer sales support for Suse Linux and also co-develop technologies with Novell to make it easier for users to run both Suse Linux and Microsoft Windows on their computers. Microsoft plans to distribute 70,000 coupons for SUSE Linux Enterprise Server maintenance and support to customers that want to run both Windows and Linux in their environments. In addition to this, Novell and Microsoft will work together to improve interoperability between Windows and Novell's SuSE Linux.

Some insights from infoworld why this partnership has come along:

Scenario one: Looking to the future and seeing the proverbial handwriting on the wall, stops the bleeding of Windows to Linux desktops.

Scenario two: Did the desktop OEMs push Microsoft toward this deal?
More of their customers want Linux and so the PC manufacturers want this technology so they can give them both.

Scenario three: The most intriguing possibility of all.
Did increasing sales of Apple Macintosh which now has Intel inside and uses OS X which is a form of Unix, have anything to do with this decision.

All this sounds very compelling for Linux enthusiasts, but in reality, it's not, esp when Microsoft talks about interoperability. Microsoft over the years has been opposing Linux and open source solution and now this deal doesn't ring a bell to me. Novell and Microsoft have come together because they both want to screw Oracle and Red Hat. This unholy alliance of arch-rivals getting together is to strike on the head of other guys.

Is this alliance going to help Novell? In short term yes, but in longer term no. As Foley from zdnet adds, "Microsoft is not conceding that desktop Linux is gaining ground. It's not admitting that its closed-source strategy has failed. Sure, Microsoft is licensing to customers' requests for better interoperability. But if you think the Redmondians are throwing in the towel, vis-a-vis open source, you are underestimating severely Microsoft's well-proven ability to come out ahead on any partnership to which it commits." And that, I think, maybe the real take-away from this, aptly described in this post from ZDNet's Mitch Ratcliffe. Microsoft is not changing its license to GPL, it is still going to sell it s/w under strict license, but Novell has opened the gates for Microsoft to sell to its customers.
This alliance is a win-win situation for Microsoft and it proves again, it has no soul at all when it comes to business.

Looking ahead, this deal and Oracle's recent unbreakable Linux move has definitely put a lot of pressure on RedHat.
It will be interesting how RedHat responds to these changes in the marketplace. Until now there hasn't been much pressure on its share price, it is holding up, which suggests the market has a lot of confidence in RedHat. Let us wait and watch how this unholy alliance comes out in future.