tage, decided to define the game in terms of core microprocessor clock speed. This is why, when you buy a computer, you are told that a 2.8 Ghz CPU is better than a 1.5 Ghz CPU. Superficially, this is absolutely true — the faster clock speed on the CPU makes it process program instructions faster. For some time, AMD made the mistake of playing the game as defined by their compePeople, quite naturally, prefer to do easy things. Easy things are — well, easy. It often seems, when we look at our businesses, that the more things we can make easy, the more profitable the company will be. To a point, this is true. If you are putting more effort than you need to into creating your product or service, the time and effort involved may well be coming right out of your bottom line. Recognizing this, most managers will put plenty of effort into taking effort out of your processes.

But wait — there's a catch. Management is not just about minimizing cost — it's also about maximizing value. Some of the effort involved in your business creates tremendous value for your customers, and chances are you aren't even sure where the greatest value lies.

When companies set out to innovate strategically, they often rush off in the same direction as everyone else. In many industries — especially high-tech industries — this causes markets to mature very quickly as unique specialty items that took tremendous R&D investment become "me-too" commodities. If the innovation is a compelling one that creates real, preferred value for the customer, this commoditization is almost inevitable. The only place this is unlikely to occur is when your competitors — for whatever reason — do not copy your valuable idea.

Let's look at an example of this. For the past several years, AMD and Intel have been slugging it out over the microprocessor market. Intel, with deep pockets and first-mover advantage, decided to define the game in terms of core microprocessor clock speed. This is why, when you buy a computer, you are told that a 2.8 Ghz CPU is better than a 1.5 Ghz CPU. Superficially, this is absolutely true — the faster clock speed on the CPU makes it process program instructions faster. For some time, AMD made the mistake of playing the game as defined by their compet

of your bottom line. Recognizing this, most managers will put plenty of effort into taking effort out of your processes.

But wait — there's a catch. Management is not just about minimizing cost — it's also about maximizing value. Some of the effort involved in your business creates tremendous value for your customers, and chances are you aren't even sure where the greatest value lies.

When companies set out to innovate strategically, they often rush off in the same direction as everyone else. In many industries — especially high-tech industries — this causes markets to mature very quickly as unique specialty items that took tremendous R&D investment become "me-too" commodities. If the innovation is a compelling one that creates real, preferred value for the customer, this commoditization is almost inevitable. The only place this is unlikely to occur is when your competitors — for whatever reason — do not copy your valuable idea.

Let's look at an example of this. For the past several years, AMD and Intel have been slugging it out over the microprocessor market. Intel, with deep pockets and first-mover advantage, decided to define the game in terms of core microprocessor clock speed. This is why, when you buy a computer, you are told that a 2.8 Ghz CPU is better than a 1.5 Ghz CPU. Superficially, this is absolutely true — the faster clock speed on the CPU makes it process program instructions faster. For some time, AMD made the mistake of playing the game as defined by their compe

t value lies.

When companies set out to innovate strategically, they often rush off in the same direction as everyone else. In many industries — especially high-tech industries — this causes markets to mature very quickly as unique specialty items that took tremendous R&D investment become "me-too" commodities. If the innovation is a compelling one that creates real, preferred value for the customer, this commoditization is almost inevitable. The only place this is unlikely to occur is when your competitors — for whatever reason — do not copy your valuable idea.

Let's look at an example of this. For the past several years, AMD and Intel have been slugging it out over the microprocessor market. Intel, with deep pockets and first-mover advantage, decided to define the game in terms of core microprocessor clock speed. This is why, when you buy a computer, you are told that a 2.8 Ghz CPU is better than a 1.5 Ghz CPU. Superficially, this is absolutely true — the faster clock speed on the CPU makes it process program instructions faster. For some time, AMD made the mistake of playing the game as defined by their compe

rred value for the customer, this commoditization is almost inevitable. The only place this is unlikely to occur is when your competitors — for whatever reason — do not copy your valuable idea.

Let's look at an example of this. For the past several years, AMD and Intel have been slugging it out over the microprocessor market. Intel, with deep pockets and first-mover advantage, decided to define the game in terms of core microprocessor clock speed. This is why, when you buy a computer, you are told that a 2.8 Ghz CPU is better than a 1.5 Ghz CPU. Superficially, this is absolutely true — the faster clock speed on the CPU makes it process program instructions faster. For some time, AMD made the mistake of playing the game as defined by their compe

tage, decided to define the game in terms of core microprocessor clock speed. This is why, when you buy a computer, you are told that a 2.8 Ghz CPU is better than a 1.5 Ghz CPU. Superficially, this is absolutely true — the faster clock speed on the CPU makes it process program instructions faster. For some time, AMD made the mistake of playing the game as defined by their competitor (almost always a bad move). Recently, however, AMD has departed from classifying their products by clock speed (which is what Intel still does). AMD now wants users to evaluate their products by effective speed rather than clock speed — and, of course, they have helped to create the means for customers to measure effective speed. This is an interesting twist in the history of CPU innovation, because today, AMD chips with slower clock speeds are being pitched against Intel chips based upon testing that is purported to depict the real-life speed of a computer using that chip. There is tremendous debate about the testing of system speeds in the technical press today, which means — to some extent — AMD has moved the game of innovation into the realm of measured effectiveness for the customer, and away from CPU clock speed. Customers, of course, will benefit from this move towards real-world comparisons and away from slavish pursuit of the gigahertz — and AMD is hoping that it has the know-how to keep up with Intel in the redefined race. For us, the most interesting part of this is that we are seeing two excellent competitors investing heavily in markedly different paths of innovation for the very same product.

The concept that competitors might not copy something that is strategically valuable seems absurd on its face. After all, why wouldn't you copy a product that enables a competitor to gain valuable market share, often at higher margins? There are three main reasons why competitors do