“PC vendors also need to shift focus away from 'distributor and reseller customers' wants' to 'users' needs.’”
Alternative 2 - Current Products and New Business Model
For Tsai, this alternative suggests that PC vendors form a new team that can experiment with new business and revenue models for PC products, such as PC as a service.
In this scenario, the business model is agile, allows risk taking and accepts failure. Vendors could, for example, partner with a digital education content publisher.
“The vendor's two-in-one devices are bundled with digital content on a subscription basis; the PC is free to users but is subsidised by the publisher,” Tsai explained.
Alternative 3 - New Products With Current Business Model
The third alternative is a more conservative way to explore new product offerings and new market opportunities, such as making PCs smarter in terms of sensing, speech, emotion and touch; expanding new products for the connected home; or developing products targeted to vertical markets.
“It's a gradual way for PC vendors to expand into new products based on their current business model,” Tsai added.
Alternative 4 - New Products With New Business Model
Finally, Tsai said alternative 4 is the most “aggressive way” to transform in terms of business operations and product innovations.
In this scenario, PC vendors could establish a new business unit to run business in a different mode and explore new technology solutions to create a completely new product line.
“This would include working with new channel partners and independent software vendors (ISVs) and partnering with startups,” Tsai advised. “The resources and revenue model might be completely different from a vendor's existing structure.”
An example could be personal assistant robots. A PC can serve as an "information butler" at home, a combination of a chat bot and voice-activated virtual personal assistant, with revenue from developers and third-party content and service providers, such as those in retail, healthcare, education, video or music.
“Business leaders of PC vendors need to think about business outcomes based on the four alternatives discussed here,” Tsai added. “Some vendors may need a whole new business and product strategy to turn their situation around.
“PC vendors need to identify their core competencies, evaluate their internal resources, and adopt one or more alternative business and product innovation models to stay in or leave the PC business.”
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