NEW GAME

New businesses achieve success against the odds with their own assets

Dirk Reiter, Karl Ulrich

2007

What do Caterpillar, Apple and the Süddeutsche Zeitung have in common? All three have successfully fought the dominating business trends and used their existing assets to penetrate new business sectors.

Caterpillar used its image as a manufacturer of powerful construction machines to launch a fashion label. Apple used its strong community and design skills with the iPod and iTunes to become the leader in music downloads. The Süddeutsche Zeitung found new sources of income via its media brand. The SZ-Mediathek with books, films, audio books and music is today one of the cornerstones of the company, which has therefore been able to lessen its dependence on the stagnating newspaper market.

All three companies have displayed their strengths by boldly implementing new business concepts. These would otherwise never have made it through the traditional filter logic of diversification management.

Management paradigms come and go, but diversification seemed to be perennially unfashionable. It sounded outdated in light of tough reorganizations in strongly diversified companies such as Daimler-Benz and its heir Daimler-Chrysler. Both forecasters and executives sounded the cry: "Back to core competencies!"