Why business size is not necessarily proportional to strength
Picture source: Boeing. An acquisition* is a corporate action in which a company buys most, if not all, of another firm’s ownership stakes to assume control of it. An acquisition occurs when a buying company obtains more than 50% ownership in a target company.
Highlight: “Aerospace giant Boeing has developed the lightest metal structure ever, which is also one of the lightest materials known to science, called Microlattice.The entire structure is 99.99% air and is comparable to the hollow honeycomb architecture of bone. The structure is composed of a network of super thin, hollow struts. The struts are around 100 micrometers in diameter and have walls just 100 nanometers thick. It’s this design that makes Microlattice 10 times lighter than Styrofoam. However, despite it being insanely light, it is also extremely strong.”
Insight: While our senses mislead us to think that we live in a three dimensional space, we are actually surrounded by multiple dimensions. Indeed, we only see the surface of things when in fact new dimensions start to become apparent with a closer look. For instance a simple fabric may seem like a plain colored surface but zooming in with the naked eye will start to reveal the mesh structure, zooming in further will expose inter locked fibers used to make the fabric and going down even further using technology will reveal hidden dimensions up to the molecular level and beyond.
The simple point here is that we overlook the dimensions of space including within organisms where the very fabric of living tissues and molecular structures are a great source of inspiration in areas such as design or engineering. While some species have been studied for their behaviors, taxonomy, morphology or anatomy, very little work has looked closer into the tissue structures at different scales. Special traits in species (e.g unusual surface strength) should serve as a hint that perhaps elements of their structures could provide applied solutions…
The light/strength property of Microlattice provides a good business philosophy: Common opinions can be misleading, for instance strong material would not be expected to be light but rather heavy, it actually comes as a surprise that a material can be strong and light. Similarly, a strong business would not be expected to be small but rather the larger organizations. There are countless examples of startup companies which rapidly become strong on the global platform sometimes even overtaking the big companies in terms of innovation and expertise; for this reason it is not uncommon to see smaller companies acquired* by larger groups.
Lets illustrate the above point with the following case study: A large diversified industrial group specialized in security systems has been in the business line for over a century. While they haven’t faced mush competition over most of the 20th century, everything started to change with new internet technologies and artificial intelligence making their way into the early 21st century. In recent years a start up company has come up with a completely new idea that makes a much stronger offering to customers in terms of security systems strength. Their system is able to identify threats and self learn to modify itself accordingly in response to the developing threat. The innovation of this small company is groundbreaking and reputation quickly rising as a serious contender to the larger more established organization. They are also praised for their service quality and customized approach which the larger company has been criticized for. Seeing this rising company as a significant threat and opportunity to expend, the large company decides to acquire this smaller company at a very high price for 4 billion USD.
Are you part of large multinational? If so, be mindful to keep an eye on what the smaller players are doing as your business model and strength may well be on the verge of being reshuffled because of them…
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What is Biomimetics: the field of gaining inspiration from nature first to solve some of our most difficult challenges. Instead of coming up with our own solutions to a problematic, the odds are that species on the planet already offer an ultimate solution. This simple fact is also another strong case to preserve species at all cost as the intellectual heritage contained within or through the study of species is both irreplaceable and invaluable…