Breaking the Kubernetes Kill Chain: Host Path Mount
Vertical Market Expansion into the Energy Sector
1. GROWTH PROCESS OVERVIEW
2013
Vertical Market Expansion
Accelerating Growth through Principled Market Opportunity
Evaluation and Entry Strategy Development
Vertical Market Spotlight – Energy Markets
2. Why Vertical Market Expansion?
After cutting expenses to
CEOs are therefore
One path an organization
the bone in the recent
refocusing on growing the
might take to growing the
recession, most companies
top line.
top line is to take an existing
now recognize that they
product or service into a
can’t cut their way to
new market.
growth.
Three Critical & Gated Questions for Evaluating Vertical Markets:
1 – Is Vertical Market Expansion appropriate for your company and is the timing right?
2 – If the answer yes, which vertical markets are most appropriate/feasible to pursue?
3 – Finally, what is the optimal go-to-market strategy?
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3. Vertical Market Expansion Risks
For every successful market entry, four fail.
95% of all vertical entries in the aerospace & defense industry
fail to take hold.
Winners and losers all look like winners at the outset – so why
do so many companies head down ill-advised paths?
Where Companies Go Wrong
Numerous pitfalls can derail even the most well-intentioned executive
•Assuming vertical market expansion will deliver expected growth
•Entering multiple vertical markets simultaneously
•Moving into markets not adjacent to your core
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4. Vertical Market Expansion Best Practices
Key Principles:
Pursue only one or two verticals at a time
Vet all opportunities for strategic fit before committing to market entry
Understand that the better the assessment of market size, competitors,
market share, revenue, costs, and other factors, the better their odds of
making good vertical market entry decisions
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6. Opportunism Abound Across the Energy Value Chain
Oil & Gas
Generation
Power and Water
Transmission
Renewables
Distributed Power
Back-up
End Users and
Waste Streams
Convergence Themes
Smart Cities
Green Energy
Globalization
Grid Modernization
Shale Gas Phenomenon
Data Center Energy Trends
Digital Oil Fields
Virtual Power Plants
Connected Homes
Energy Storage
Smart Buildings
Water and Energy
7. Energy & Environment
Top 10 Technologies and Markets to Watch for in 2020
Energy Efficiency and
Smart Buildings
Gas-Fired Power
& Shale Gas
Exploitation
LED Lighting
Revolution
Small Scale
Distributed
Generation
Energy Recovery
from Waste
Top 10 Markets
of the Future
Energy
Harvesting
Smart Grids
Advanced Batteries
and Energy Storage
Solar PV
Smart Water Networks
Source: Frost & Sullivan
8. The Challenges and Opportunities in Energy are Too
Great for Any One Company or Industry to Address
Energy management is increasingly data
driven and customized
Growing need for efficiency drives
information-based solutions across the
value chain:
– Upstream oil and gas
– Power generation
– The Grid
– Smart homes and buildings
Decentralized power systems increase complexity and opportunities globally through
challenges such as:
– Intermittent power from renewables
– Load profile uncertainty due to electric vehicles
– New business models with utilities and third party energy information providers
– Growth of on-site power and micro grids
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9. Unique Qualities of the Energy Industry to Consider
When Assessing a Potential Expansion
• High visibility industry
• Intrinsic to economic growth and development
• Key target for environmental legislation
• Strong public sector involvement, even ownership in
certain countries
• Utilities and governments with long planning cycles
• Highly regulated
• Large end user of materials, equipment and services
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16. Energy Attracting New Competitors into the Market
Through Industry Convergence
New materials providing
• Better electricity conductivity
• Better insulation
• “Self-healing” for everything from pipelines to buildings
Information and communications
• M2M in power plants and across grids
• AI, for example in predicting energy loads and demand based on weather
• Gathering and interpreting high volumes of data
Defense Companies
• Field services for remote oil and gas: information, security, communication, etc.
• Commercialization from military to private sector
• Leveraging advances in small scale, efficient and light weight technologies
Smart Industry Integration
• Energy, IT and Energy in the Smart Home
• Security, Transportation, Electricity and Water in the Smart City
• IT, Building Materials, and Efficiency for the Smart Building
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17. New Companies Entering energy Will Force
Existing Competitors to Respond
• Redefining “Energy” in light of changing
market dynamics such as:
• Shale oil & gas
• Renewable energy
• Efficiency and green standards
• Energy savings as revenue
• New business models in energy
generation, procurement, and
management
• Moving from equipment to solution sell
• Retiring workforce for operations at
utilities, oil & gas and heavy industry
open the door to more third party
outsourcing opportunities
• Increasing automation in homes,
buildings, factories, the grid, cities and
oil fields all center around better energy
usage
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18. Different Strategies for Entering or Expanding Share in the
Energy Market
Low
Directly in
Energy
High
Market Penetration
Product Development
Verizon is already an established player in
power distribution communication, though
the market has limited growth due to
saturation. Using it’s large communication
network and expanding into related grid
markets would boost revenues and visibility
By leveraging its know-how in areas of
communication, monitoring, and technical
advances, Lockheed Martin is able to
transition key core competencies from the
aerospace and defense industry into a value
proposition for energy efficiency and security
to utilities and industrial customers
Market Development
Diversification
IBM, Cisco and others have embraced the
Smart City, looking to connect disparate
systems such as security, energy, water,
transportation, and others through a
connected platform to reduce costs, improve
efficiency and communication across city
services. Smart Cities are a new market
and concept in the making, early entrants
will define what the market will be
Google has had several forays into the
energy space, from helping homes monitor
power usage, to installing and promoting
electric vehicle charging stations. Google’s
most recent major energy venture has been
its $400M investment into solar power.
What might be next, the Google Smart
Energy Home?
Increasing Risk
Increasing Risk
PROXIMITY TO
EXISTING MARKET(S)
Existing
Market(s)
DEGREE OF INNOVATION
19. Secrets to Success in Market Expansion into energy
Find
the Right
Partner(s)
Invest for the
Long Term
Know Your
Business Model
Define Your Value Proposition
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