What are strategic inflection points? Is your business facing such a crisis?<\/p>\n\n\n\n
Drawing on his experience as the CEO of Intel, Andrew Grove provides clear guidance on preparing for, identifying, and adapting to the kinds of upheavals that send less agile companies out of business. He calls these crises “strategic inflection points.”<\/p>\n\n\n\n
Keep reading to learn what strategic inflection points are and how to determine whether your business has reached one.<\/p>\n\n\n\n\n\n\n\n
Grove’s advice draws heavily on his experience leading Intel through one of its greatest crises to date. Before selling microprocessors, Intel specialized in memory chips. An \u201cearly mover\u201d on this technology, they enjoyed close to 100% of the market share in the late 1960s. However, by the early 1980s, Japanese firms began selling higher-quality memory chips at lower prices. Able to produce and export these chips at high volume, they quickly grabbed 70% to 80% of the market share.<\/p>\n\n\n\n
After three years of scrambling, confusion, and vigorous debate, Intel decided to pivot. Ultimately, their bet paid off. Not only did Intel survive an upheaval that shut down other American memory companies, but they also became a global leader in microprocessors.<\/strong><\/p>\n\n\n\n After reflecting on his experience, Grove distilled his hard-won lessons into clear advice for other companies facing a similar upheaval. He encourages you to adopt a stance of vigilance, flexibility, and forward-thinking as you work to keep your organization stable and competitive in an ever-changing business environment.<\/strong><\/p>\n\n\n\n To prepare for a crisis like Intel\u2019s, you first need to understand what kind of change to look out for. Throughout the 1990s, Grove defined and popularized the concept of the “strategic inflection point.”<\/strong> This is the point in a company\u2019s trajectory where they face a crisis unlike any they\u2019ve ever seen before. Strategic inflection points may look different across industries and companies, but Grove notes they all share three defining characteristics:<\/p>\n\n\n\n Strategic inflection points happen constantly throughout the commercial world. For example, the shopping mall was once the future of retail, but online shopping has now forced malls across America to close. Or, consider how free-trade agreements have forced international competition on companies used to operating in smaller domestic markets.<\/p>\n\n\n\n