HN Books @HNBooksMonth

> I would have to disagree with the goal of any business is to be a monopoly.

> There are lots of examples of successful business out there who did not monopoly the market.

Such as? If you cannot eliminate competition within your given market, marginal profit will eventually be driven to zero. The internet amplifies this challenge because it is not geographically constrained (minimal transaction costs) and software amplifies this challenge because of zero marginal cost (creating massive economies of scale).

You can find more on this in the works of Michael Porter (http://amzn.com/0684841487, http://amzn.com/0684841460) and Peter Thiel (http://amzn.com/0804139296). Zero to One discusses how many seemingly successful non-monopolies are actually either monopolies pretending not to be one or non-monopolies that are not as successful as they portray themselves to be.

Wow, lots of good recommendations in this thread already... I skimmed them, but apologies in advance for any dupes:

I'd suggest some general "business strategy" works that will help you understand the context of how/why the very highest level business decisions are made, as well as some works that deal with tying together strategy and tactical execution (which includes technical initiatives).

1. Understanding Michael Porter - John Magretta. http://www.amazon.com/Understanding-Michael-Porter-Essential...

Porter's framework is VERY influential in the business world, and having at least a passing familiarity with his work is important at the higher levels. Going straight to the primary sources (Porter's books) can be a bit daunting as they are big, dry, and academic and not exactly what you'd call "page turners". This book is a fairly solid overview of the key elements of Porter's approach, and a good read before diving into the meat of Porter's works.

2. Competitive Strategy - Michael Porter. http://www.amazon.com/Competitive-Strategy-Techniques-Indust...

3. Competitive Advantage - Michael Porter. http://www.amazon.com/Competitive-Advantage-Creating-Sustain...

4. On Competition - Michael Porter. http://www.amazon.com/On-Competition-Updated-Expanded-Editio...

5. Good Strategy, Bad Strategy - Richard Rumelt. http://www.amazon.com/Good-Strategy-Bad-Difference-Matters/d...

6. Blue Ocean Strategy - W. Chan Kim, Renee Mauborgne. http://www.amazon.com/Blue-Ocean-Strategy-Uncontested-Compet... This book has its critics, but I think it's a worthwhile read. Some people argue against the whole idea of a "blu e ocean" market, but even if the authors aren't 100% right about everything, I think the lines of thinking this book fosters are valuable in a general sense.

7. The Discipline of Market Leaders. http://www.amazon.com/Discipline-Market-Leaders-Customers-Do... I think very highly of this book and the author's approach to strategy. It's not radically different from the Porterian approach in some ways, but I'd say it's narrower in focus and simpler. The big takeway is the idea (which should be obvious, but often isn't) that "you can't be everything to everyone". The authors push a model of choosing a market discipline to appeal to a certain type of customer, and making that discipline the core of your business.

8. The Machine That Changed The World. http://www.amazon.com/Machine-That-Changed-World-Revolutioni... Have you ever wondered what this "lean" stuff is all about? Or why Toyota is so revered by business leaders? Here's a good place to find the answer to those questions.

9. Working Knowledge- Davenport and Prusak. http://www.amazon.com/Working-Knowledge-Thomas-H-Davenport/d... Perhaps the seminal book on Knowledge Management, or at least one of them. If you want to understand the importance of knowledge in an organization, this is a very valuable read.

10. Outside Innovation - Patricia Seybold. http://www.amazon.com/Outside-Innovation-Customers-Co-Design...

11. The Future of Competition. http://www.amazon.com/Future-Competition-Co-Creating-Unique-...

12. The Balanced Scorecard. http://www.amazon.com/Balanced-Scorecard-Translating-Strateg...

13. Strategy Maps. http://www.amazon.com/Strategy-Maps-Converting-Intangible-Ta...

14. The Strategy Focused Organization. http://www.amazon.com/Strategy-Focused-Organization-Scorecar...

15. If Only We Knew What We Know. http://www.amazon.com/Only-Knew-What-Know-Knowledge/dp/14516... Another seminal title in the Knowledge Management world.

16. Common Knowledge - Nancy Dixon. http://www.amazon.com/Common-Knowledge-Companies-Thrive-Shar... Another seminal title in the Knowledge Management world.

17. Winning The Knowledge Transfer Race. http://www.amazon.com/Winning-Knowledge-Transfer-Michael-Eng...

Good stuff. Personally, I've been spending a lot more time lately getting serious about strategic thinking, doing competitive analysis and formulating meaningful strategies instead of just "winging it" so much.

The book Outhink The Competition[1] really inspired me to start down this path. There's some good stuff in there, and that led to me finally picking up my copy of Porter's Competitive Strategy[2] and digging in. I take this seriously enough now, that I wrote a quick and dirty internal app just for managing competitive intelligence and keeping track of documents and links related to competitive analysis and strategy formulation.

Which, when you think about it, is a Good Thing. I mean, if you're talking to an investor and they say "how do you intend to compete with $FOO?" It's probably good to have a solid understanding of exactly how you intend to do that, instead of just saying "Oh, we'll out execute them." Especially when you choose to play in crowded markets like we do[3]...

[1]: http://www.amazon.com/Outthink-Competition-Generation-Strate...

[2]: http://www.amazon.com/Competitive-Strategy-Techniques-Indust...

[3]: http://news.ycombinator.com/item?id=4054540

⬐ ckluis

Seems like if you could automate your app a little you might have a decent app targeted for the startup crowd :)

⬐ mindcrime

Funny you would mention that. This app has been so useful to me already, that I've considered making a SaaS offering out of it. If I don't do that, we might just release it as open-source. Or both. The biggest argument against making a SaaS offering out of it, is that this type of app isn't really core to what we're doing, and I'm worried that it would just turn into a distraction.

⬐ Kaizyn

Set it up as an internal SaaS tool. After you and others on your team have 'eaten your own dogwood' for a while, then start selling it. Even if it is a sideline product, it's still worth pursuing.

⬐ ckluis

Open sourcing it would seem like a nice way to potentially have other people help make a product better for you that isn't your core product.

Or do what I think 37signals should have done with sortfolio. Start a subsidiary and put 1-2 people removed from your company in charge of it. That way you still own the IP, but you aren't required to focus on it.

⬐ mindcrime

Heh, I don't think we're big enough for a subsidiary yet. :-) But yeah, at some point I think we'll do something with it, even if it's just putting it up on Github. We're an Open Source startup anyway (as in, all of our core offerings are Open Source / AL 2.0 licensed), so doing that kind of thing is in our DNA.

Some questions to think about:

- Are the customers genuinely frustrated with the low quality of the products currently on the market? How do you know? How can you convince them you're better?

- Will you create new markets? If not, can you differentiate yourself enough that you're not competing purely on costs? Can you beat your competitors on costs? How long can you sustain that? (i.e. as your costs rise can you stay competitive)

The typical books here are:

http://www.amazon.com/Competitive-Strategy-Techniques-Indust...

...about competing in markets, and...

http://www.amazon.com/Blue-Ocean-Strategy-Uncontested-Compet...

...on creating new markets. (At this point I've only read the latter. The other one is on my queue. :-) )