1 USC MIW Case March 2010 GSBA 556 – Business Models for Interactive Digital Media & Services Case Version 1.0 - March 8, 2010 Growing Delighted Customers in the Digital Ecosystem: Customer-Centricity at Make It Work Inc.1 It was a bright February 2010 day in Santa Barbara and the early morning California sun was shining into the office of Eric David Greenspan, the CEO of Make It Work. As Eric started his day with a fresh mug of steaming coffee brewed from the special Starbucks coffee machine in the office, he looked out of the window and pondered the next steps for the growth of the company. It was now over eight years since the founding of Make It Work in 2001 as a two-employee start-up, and Eric was proud of how far they had come. Make It Work was founded on the idea of bringing personal high-touch technology services to the digital home with same day service, instant response, and an extreme approach to customer delight. Eric who loved In-N-Out Burger had always relished the idea of Make It Work being the best in quality and service – just as In-N-Out was for the fast food business. And fortunately, Make It Work had lived up to that vision. In 2006, Make It Work was named Software Services Company of the Year by the Software Council of Southern California, and in 2007 made it to the Inc500 list as the 78th fastest growing IT company in the USA. Make It Work had also been named "Best of" in computer repair by the Santa Barbara Independent the past two consecutive years. They had extended their territory beyond Santa Barbara and were now covering major parts of Southern California with eyes on other states, had partnerships with major technology players, and were extending the scope and range of their technology services. In 2010, Make It Work had set their sights even higher to be the “Virgin Airlines” of the consumer digital technology service industry. Eric was especially proud of the IT-enabled real-time response capabilities that the company had developed for helping them to delight customers, and the way that the management team worked together around that. Eric took the last sip of his coffee, and went back to his HD 32” computer monitor. He started eying the up-to-the-moment performance measures on the colorful “delight dashboard” that showed real-time customer satisfaction numbers and other performance measures [See Exhibit 1 for Make It Work’s delight dashboard]. Through their home-grown delight dashboard, they could monitor up-to-the-minute performance stats, financial measures, customer bookings for service, and other key performance indicators. With this dashboard they could also be alerted very quickly of any issues warranting immediate attention such as a customer complaint level beyond a predefined threshold, and be able to respond to it quickly. Apart from the delight dashboard, Eric also see the current task plans of all the management team in the Yammer window [See Exhibit 2 for a view of Yammer]. Yammer is a collaborative software package that enabled Make It Work managers to easily communicate to each other their daily working schedules and on-going issues. It is based around answering short frequent answers to one simple question “What are you working on?” – sort of like an enterprise Twitter for projects. These and other IT capabilities and their associated business processes made it possible for Make It Work to be nimble and act very quickly. 1 This teaching case was prepared by YoungKi Park, Doctoral Candidate in Information Systems at the USC Marshall School of Business under the direction and editorial guidance of Professor Omar El Sawy. We are grateful for the time, access, and insights provided by the Make It Work management team. Permission to use the case in other schools can be obtained from either [email protected] or [email protected]. 2 USC MIW Case March 2010 Company Backgroundand Development Founded in 2001 by Eric Greenspan and Jeremy Anticouni as a two-employee operation, Make It Work started a neighborhood computer support business that helped resolve problems with PCs and Macs, home networks, mobile devices, printers, iPods®, home theaters, online backup, Internet safety, gaming systems, financial software, health checks, gadgets and gizmos, and nearly everything that “beeps, clicks, or hums” in homes and small businesses. Eric’s own words on his personal homepage www.ericgreenspan.com most vividly describe how it started and grew: “In November, 2001, I officially formed my third company, once again called Make It Work. When I sold the first Make It Work, I kept the trademarks, URLs, systems, etc. But this time, I wanted to do it differently, so we created a new logo and launched the business. We got many of our former Citrix clients back and we earned our gold Citrix status pretty quickly. Jeremy Anticouni, my first tech at the original MIW, joined as a founder shortly thereafter. He was a savvy Citrix engineer and the business started to take off. The phone was ringing, but many of the calls were coming in from home computer users. I wondered if technology in the home was strong enough to support a business yet. It seemed like an up and comer regardless, but I wasn’t willing to bet the farm on it, so I launched a division of Make It Work called Computer Plumber, the residential provider of MIW. I remember sitting with Jeremy, who was a very talented engineer, discussing how he could wow our customers with his advanced skills while fixing their home computers. He laughed and said, “I think this is a mistake, but I trust you.” A year later, Computer Plumber was booming and we renamed Computer Plumber to Make It Work, Inc.®, the Neighborhood Computer Support Company™ and rolled all our focus into this emerging industry. We went on to receive $3.7 million in funding, doubled revenues four years in a row, had 21 consecutive growth quarters…and we lost a ton of money in the process. In 2008, trusting my gut, we completely realigned the business to become profitable. In December of 2008, we had our first EBITDA positive month. Since then, we have continuously strengthened our bottom line and business structure and have matured into a solvent, soon-to-bedebt-free, profitable business. Currently Make It Work serves all of Southern California, with long-term plans to expand nationwide. Its fleet of red and white, logo-emblazoned Mini Coopers are seen from Santa Barbara to San Diego, fixing everything that “hums, beeps or clicks, from computers to iPods to home theater” in homes and small businesses. With a focus on mind blowing customer delight, the company serves over 35,000 customers and has received over 30,000 cult-like testimonials. With Tech News, our nationally syndicated radio show on CBS and ABC radio, the company is achieving great things on a regular basis and we hope to become the “Virgin Airlines” of the industry nationally in 2010.” By bringing personal, high-touch technology services to the home with same-day service and instant response, Make It Work has delivered superior customer experience, challenging the existing technology service market generally characterized by a low touch, in-store support and the long time it takes for service to start and be completed. If customers are not delighted, they get a full refund. The Make It Work business model has had great success and has resulted in company growth in both customers and revenues [See Exhibit 3]. Make It Work has also since evolved into offering technology radio shows and online interactive webinars around digital technologies and managed its services portfolio under the rubric of “..for a stress-free digital lifestyle ..” ™. More details are on their website at www.makeitwork.com. 3 USC MIW Case March 2010 The company has expanded to cover all of Southern California, from the Mexican border to Palm Springs to Goleta (http://www.youtube.com/watch?v=W9Q-Ujs7OuQ). Make It Work’s 40 tech support specialists drive distinctive, symbolic red and white Mini Coopers to deliver extreme customer service to homes and small businesses. The logo-emblazoned Mini Coopers parked in front of residential driveways and small businesses have helped Make It Work’s branding and name recognition in the local neighborhoods. The Mini Coopers are like mobile offices and also carry needed spare parts, and some consumer products that technicians sell to homes. Everyone has a mobile device, whether Blackberry or iPhone or other, and all information about service calls are entered in real-time. 4 USC MIW Case March 2010 Frequently Asked Questions about MIW Service(from makeitwork.com) How can I book an appointment? Don’t go berserk, call 877.MAKEITWork (877.625.3489)! Customer Response Representatives are available to assist in booking appointments and answer questions Monday-Friday 8:00am – 7:00pm, Saturdays 8:00am – 5:00pm and Sundays 9:00am - 5:00pm. We strive for same to next day service, so don't be surprised when we say, "See you this afternoon!" When are you open/available for appointments? We strive for same, to next day service. MIW Neighborhood Technology Consultants are available to come to your home and solve your technology problems Monday - Saturday 8:00am – 6:00pm. If your appointment runs over these hours, don’t worry, we won’t run out! We will always stay until the job is complete. Need a special time, don't be afraid to ask. We hardly ever say "no" to a customer. Do you offer drop off service? Nope. Make It Work specializes in on-site technology support for home users and small businesses. We have found through experience that computers and technology work best in their natural environment, with their normal connections. Who wants to climb under their desk and mess with all those wires anyway? Do you offer phone support? We have a phenomenal in-house Technical Response Team that is available for phone support during business hours, Monday-Friday 9:00am – 5:00pm. The Technical Response Team can answer questions and provide stateof-the-art remote support technologies to troubleshoot and repair technology problems over the phone. Do you provide service in my area? MIW serves most of Southern California, including Santa Barbara, Ventura, Los Angeles, Riverside, San Bernardino, Orange, and San Diego Counties. If we are not in your area yet, it doesn’t mean we aren’t coming! Keep an eye on our coverage map for future MIW expansion! Do you service Macs? YES! No matter the brand, your computer is safe in our hands! Do you sell technology products? Make It Work Technicians carry a variety of products with them at all times. If you would like to order any new technology, we can definitely help with that. Take advantage of our Technology Concierge service, and let an MIW Neighborhood Technology Consultant help pick out your new product today! How can I pay for service? We accept cash, check, MIW Crash Card, and most major credit cards, including Visa, MasterCard, Discover, and American Express. Is Make It Work really that great of a company? You will hear us saying this everyday and twice on Sundays, but the best way to be sure that Make It Work is as great as you might have heard is to read a few of our 30,000+ testimonials. We wake up every morning to be great, and here's proof that we are doing what we promise. 5 USC MIW Case March 2010 The high quality technical service that Make It Work provides has been recognized by large technology partners. For example, in 2006Make It Work became a “Microsoft Gold Certified Partner”, a coveted designation awarded to only a select number of service partners worldwide by Microsoft. In 2007, Make It Work forged a strategic partnership with Verizon Communications to provide services that integrate FiOS TV and Internet services with complex digital home solutions like home theaters, multimedia rooms, computer networks and audio-video needs (for more details, refer to http://news.thomasnet.com/companystory/514983). Make It Work also has been an Apple authorized reseller since 2005. Growing a satisfied customer base that is strategically supported, Make It Work made the Inc500 list in 2007 as the 78th fastest growing IT company in the United States. The high quality technical service has also allowed Make It Work to charge premium prices for their service. However, their responsiveness is so well appreciated that 75% of their current customers have pre-paid agreements (with a discount for pre-payment). In March 2009, the company became the host of Tech Newson CBS Radio’s KNX 1070, LA's premiere news/talk radio station. Make It Work CTO Jeremy Anticouni and the acclaimed radio talent, Tim Conway, Jr. host this show. The Tech News has grown quickly in its early stages and topped the Arbitron rating charts. This successful radio show has helped attract new customers while garnering new co-sponsors for the show with very favorable economics for Make It Work. It has attracted the launch of a second radio show starting January 2010 in the San Francisco market on ABC/Citadel’s KSFO 560. It will soon broadcast from other US cities, including New York, Washington D.C., Chicago, and Dallas. MIW Press Release Make It Work Lands Tech Radio Show on KNX 1070 Tech News, Powered by Make It Work will launch Saturday, March 21st, 2009 Los Angeles, CA – Make It Work, Inc. ®, the Neighborhood Computer Support company™, today announced that it has signed a multi-year contract to host a new radio show, Tech News, powered by Make It Work on Southern California's most honored news station, KNX 1070 NEWSRADIO. The show will broadcast Saturdays from 1pm – 2pm and be followed with an online workshop from 2pm – 3pm, launching Saturday, March 21, 2009. The show will be hosted by Jeremy Anticouni, cofounder and Chief Technology Officer of Make It Work and Tim Conway, Jr., a renowned radio talent. Tech News, powered by Make It Work will feature expert advice and genuine content, focusing on the latest technology trends derived from real life experiences from Make It Work Neighborhood Technology Consultants who currently serve tens of thousands of Southern California residents. Topics will include discussion about the latest PCs and Macs®, Mobile Devices, Internet Safety, Home Theater, the Internet, Wireless Networking, and of course troubleshooting. After the hour of on-air broadcast, the show will shift to a live, interactive webinar format from 2pm – 3pm. Listeners are invited to log onto KNX1070.com at 2pm on Saturdays to follow Jeremy and Tim to Tech News Interactive, where they can continue to chat and ask questions in a live setting. Tech News Interactive will use GoToWebinar® from Citrix Online, a division of Citrix Systems, Inc. (NASDAQ:CTXS) to present content and allow for listener interaction. Designed specifically for Webinars and larger online events, the award-winning GoToWebinar combines exceptional ease of use and user-friendly features with advanced security and industry-standard encryption for maximum privacy and data protection. Citrix Online is also a major sponsor of the Tech News radio show. “Tech News is going to be different than any other tech show because the content is from real world experiences from the hundreds of homes Make It Work visits each day,” said Eric David Greenspan, co-founder and CEO of Make It Work. “We’re not just reading the headlines; our technicians are solving technology problems for customers throughout Southern California on a daily basis. We know what technology problems people are facing and we have practical solutions to share with KNX 1070’s listeners,” said Greenspan. KNX 1070, a CBS Radio station, broadcasts to nearly 1.2 million listeners a week and streams live on the Web 24/7.Major sponsors include: Verizon Communications, Citrix Online and South Bay Mini/BMW. 6 USC MIW Case March 2010 Supporting the Growth of Delighted Customers in Digital Ecosystems: Real-Time Responsiveness is Key Make It Work’ digital business ecosystem is turbulent and dynamic, which means that changes in customer preferences are fickle, competitor moves are unpredictable, and emerging digital technologies are multiplying fast. This requires nimbleness and agility, and a realization of the critical importance of near-real-time responsiveness for competitive advantage. Eric Greenspan describes it this way: “We are like plumbers. If a plumber does not respond, your house can be flooded and damaged. People are so dependent upon technology in their day to day lives, that if a computer or iPhone stops functioning, they are unable to perform their daily responsibilities. As a result, MIW must respond immediately to all requests that related to our customers inability to function. Imagine if a TV didn't work and the Superbowl was about to start, you have 10 friends over, you just finished preparing a full meal, etc. Imagine if your daughter's hard drive crashes and her homework is due tomorrow. Imagine if your computer has a virus and you cannot log on to pay your bills? If we fail to respond immediately to a customer and a prospect’s call, they will call someone else. People deserve great service and any company that believes they can allow a customer to wait for an extended time is merely opening up an opportunity for a competitor. ” To be real-time and to deliver superior customer experiences, Make It Work gears all of its business processes and resources to their core business process -- the growth of delighted customers. Make It Work believes that the more they can increase the number of extremely satisfied customers, the more it will enhance financial performance. The internally developed information systems and IT infrastructure play a key role in making this possible. For example, their web-based customer management and call center system (Web CRS)has smarts that help their hotline operators identify a customer’s problem, match an appropriate IT specialist’s skills to the problem, check their availability, and set-up a visit schedule – while on the phone with the customers. All these processes are completed in a few minutes. Customers are notified by a call of the time when the assigned tech specialist will arrive. Customers are asked by email to give feedback about the service they received. The email explains the purpose and importance of the customer’s feedback, and then URLs them to the web site to ask several questions including their delight rating score. These responses instantly update their customer and performance database. All the data generated through these processes are stored in a database and used to calculate key performance indicators in the “delight dashboard.”If a measure goes below or beyond a predefined threshold, the dashboard system alerts managers by sending emails and changing the indicator’s color so that managers can notice and manage the problems immediately. The customer feedback is monitored by the management team -- including the CEO. If the delight point is below the threshold 3.80 out of 4 --- the perfect delight point is 4.00, then a procedure is immediately triggered. The Make It Work customer care team immediately calls the not-fully satisfied customer and finds the reason why the customer is not delighted. To make the customer happy, the Make It Work care team has the flexibility to reduce the chargeable service time, and redo anything that was deemed not fully satisfactory. Furthermore, if the customer is not satisfied after that, they receive a full refund. The current average delight score is 3.92 calculated over about 30,000 customer services. Because tech specialists are the interface between Make It Work and customers, they play key roles in delivering superior customer experience. They are trained in technological skills, attitude, and the policies of customer service. They are even trained in dress appropriateness and home etiquette. In addition, Make It Work has developed MIWALL, an iPhone and mobile device application, which notifies tech specialists of any change in policies, new technology tips, and new marketing events [See Exhibit 4 for a view of MIWALL]. When a tech specialist receives such a notice, they are required to reply in real-time with an energetic “On it”. If they do not reply, the tech manager personally calls the technician and confirms the notification with them. Furthermore, the customer database stores other non-service all related data that is gleaned from visits such as a plan to buy new entertainment appliances, as 7 USC MIW Case March 2010 well as non-intrusive personal information such as the name of a pet. Then, this information is used to deliver better future service or to create new services. The accounting system, QuickBooks,is sufficient for the current size of Make It Work. It keeps track of sales data related to services provided to customers, and feeds accounting data into the digital dashboard which calculates key financial performance measures so that all managers can monitor and manage operations in a timely manner. In short, information systems are the nerve center of Make It Work, connecting all business processes and resources and allowing communications among all managers and technicians in real time to drive the increase in the number of delighted customers. Understanding MIW Strategyand Culture through the Management Team The CEO: Think – Test – Implement – Disrupt Eric strongly believes Make It Work’s core business is to deliver the utmost superior experience to customers. All his concerns are about how to sustain the growth of delighted customers. As a big fan of the In-N-Out Burger business mantra, he will not expand the business at the expense of customer service quality. To keep increasing the number of delighted customers, he continually experiments with the learning cycle of what he calls “think-testimplement-disrupt”. He thinks and tests a new idea, implements it if it proves to works well, but disrupts it soon by replacing it with a new idea, modifying it, or just throwing it away if it does not fit anymore. Constant disruption is a must to survive in a dynamic digital ecosystem. He believes that Make It Work’s IT infrastructure is adequate to serve the core business. Make It Work just needs to replicate technologies that it is using now in Southern California to other areas when it expands its business. He explained: “Setting up a technician with a car and a Blackberry in New York City is no different from doing it in Orange County. We run the whole thing like a football team. Some of our Level Four techs have offered to relocate at least temporarily to some of these markets.” On the other hand, Eric thinks that the biggest challenges for expanding the business are to find good people and adjust Make It Work to local cultures. The Santa Barbara culture as Eric playfully likes to say is a casual “flip-flops beach culture”. New York city is markedly different. 8 USC MIW Case March 2010 The Chief Innovation/Technology Officer: Over-Engineer for Growth The Chief Innovation/Technology Officer and cofounder of Make It Work, Jeremy Anticouni has led the development of in-house information systems. These include their Web CRS (a customer management and call center system), the digital delight dashboard suite, the online survey system for collecting customer feedback, MIWALL (an iPhone mobile device bulletin board application), their customized Blackberry email system. He oversees all system development and maintenance activity and any relationships with contract developers. He is also the one who is constantly poking for emerging technology innovations that can help the business. The early use of Yammer software for the management team www.yammer.com is an example. Like the CEO, Jeremy believes that Make It Work’s information technologies were over-engineered at the outset at the right level for growth, so he is satisfied that they are adequate for near-term expansion. He is also satisfied with the level of redundancy such that there is not a single point of failure. They run one logical, consistent database that is physically distributed over several systems. However, he worries that as Make It Work expands its business to other states, it will needs to hire more employees, use more resources and manage more data from the extended business processes, possibly resulting in a lack of IT capacity. He is looking at virtualization solutions to make it easier to expand with less computing-intensive devices at the edges of the network, and to have more “offthe-shelf scalability.” The Chief Operating Officer: Coach the Team The COO, Randy “Coach” Greene used to be an Ohio State football player, and he knows how to operate a team. He is good at probing and transforming team members with receding personalities into strong assertive ones who are comfortable with themselves and others on the team. He applies such know how to managing his Make It Work technician teams. He tries to motivate tech specialist team workers by having regular face-to-face team meetings and letting them share their experiences and knowledge they have learned through their work. It is not only talk – Randy tracks the tech specialists copiously and helps them improve the way they work on the customers' premises. Sometimes he uses the Skype video feature on the technicians’ laptops to observe how the technician is working in a customer’s home. Randy believes this also helps to assure the customer that the technician is doing the right work. This video feature also helps the technician get information and advice from other technicians to more quickly solve tough technical problems with external assistance -- if needed. 9 USC MIW Case March 2010 Randy constantly uses the digital dashboards on his office computer monitor, but at the same time he cherishes three white boards which hang visibly on his office wall. The backdrop of his football “chalk talk” culture is evident and his office has a variety of football memorabilia. He uses those white boards to manually write key tasks and measures: action, sales, and delight measures every morning. This is also his interaction medium with others who call or drop in to his office. Randy is quick to point out that there is a good balance between human interaction and automated indicators. Even though information systems can automate all procedures to identify problems, match appropriate technicians, and schedule the visiting time, he does not want that to be all there is. He repeatedly emphasizes the importance of a customer having an empathetic conversation with a real person who is not “short” in his responses, but who takes the time to listen and interact, and in turn generates a much better customer experience. That is not only true for customers, but also for employees. Vice President, Finance: Track the Financial KPIs to the Hilt Carson Feleay started his career at Make It Work as the controller, and was promoted to Vice President of Finance after leading the development of industry-relevant financial reporting, helping enhancing executive decision-making through better financial reporting --- which helped achieve greater overall company performance. He is well-versed at enforcing strict financial controls and streamlining systems and procedures to maximize productivity and profitability. One of his roles is to monitor and control how individual technicians spend their time effectively because their time is the core resource of Make It Work to create revenue. He also manages the effective operations of the Mini Coopers. He is the one who has to count the pennies which can add up quickly. For example, he is somewhat skeptical of the value of renting the Starbuck coffee machine costing Make It Work about $350 monthly, even though he understands the importance of the work environment. Carson relies on the delight dashboard to monitor and manage key financial performance indicators (KPIs), including sales, revenues, the number of bookings, appointments completed, headcount, average revenue per appointment, cash flow from operations to name a few. Overall, he is satisfied with current information systems, but recognizes the future needs for several “wish list” IT functionalities that could allow him to keep score in more probing ways as the business expands and becomes more complex; for example, online ad hoc data query, drill-down/up data manipulation and sophisticated slice-anddice data analysis. 10 USC MIW Case March 2010 The Director of Flow: “Always On It” ! Heather Burlesci has the telling title of Director of Flow. She started her career at Make It Work with door-to-door marketing, followed by quick promotions in the customer service and accounting departments. She has gained a lot of practical knowledge about the workflow process with technicians at Make It Work over the years. She oversees all call center and scheduling operations with two (and sometimes three) other employees and with the help of the Web CRS system. With a motto of “Always On It” her team successfully manages all service calls and transactions generated from all over the Southern California service areas. They work 7 days a week, from 7:30 am to 7 pm. Heather is very proud of the call center stats. Their average hold time is only typically 18-24 seconds, and their skill level with CRS is such that on average a call lasts between 2-4 minutes. They use Google maps to estimate drive times for technicians and can give customers a 30 minute window for the arrival of the technician to the customer’s premises – they hope to integrate that feature into the CRS in the future. While generally satisfied with the CRS system, Heather also has a wish list for new IT functionalities for the CRS system to deal with the deluge of new customers, and self-service features for customers to track the status of their booking requests online. The Senior Assistant Coach: Also the Running Back … Yes, Senior Assistant Coach is really his formal title. As a field manager, Ben Wilding is in charge of hiring and training new technicians. He also creates and updates policies which all tech specialists should follow. He also is expected to set the example, and show them how. He assists “Coach” Greene. He has expertise in technologies and keeps making sense of technological changes. He posts new updates in policies and technologies, and marketing events on MIWALL, the iPhone bulletin board application for communicating these changes to all technicians. He confirms these changes with every technician. Ben always listens to technicians to gather their insights and experience so that he can create new ideas for services and policies. He monitors Make It Work’s competitors through his network of relationships with professional colleagues, as well as through learning from new employees; for example, what kinds of new services competitors introduce and how they change service policies. He believes that Make It Work’s information systems capacities are beyond that of the typical company in terms of the task support and the variety and quality of information they provide. However, he believes additional investment in information technologies can further enhance work performance. 11 USC MIW Case March 2010 The Director of Clever: Managing the Buzz &Bustle.. Ashley Smith joined Make It Work in February 2009 with the creative title ”Director of Clever.” She is the point person who makes sure things get done in critical projects, that people stick to deadlines, and she helps to prioritize and expedite key initiatives for Make It Work – she manages the day-to-day bustle. As she says without missing a beat: “I’ll hop on IM and get them to do it.” But Ashley is also in charge of helping to manage the “buzz”. She manages Make IT Work’s activities on social networking sites such as Facebook and Twitter. She updates information about Make It Work on these sites and redirects questions for Make It Work from these sites to the appropriate technicians who can answer them. She is also the associate producer for Make It Work’s radio show. The Competitive Landscape of Make It Work’s Digital Ecosystem Make It work operates in a very dynamic technology ecosystem and a highly competitive business environment. It sits in the midst of a digital ecosystem that spans digital home entertainment, small business computing, and the explosion of mobile devices and their “apps”. New technologies that Make It Work is required to support appear virtually every week, whether it is a Windows 7 update, a new Slingbox model, a new iPhone app, the emergence of Android devices, or a new HDTV feature. Switching costs for customers are low in this line of business. If the company does not respond to customers’ calls rapidly, they will call other IT service companies --- meaning that consumers can move easily and rapidly. Consumer confidence is also very fickle at this time given the economic downturn of the last two years, and it directly affects the spending habits of consumers – so it is difficult to predict how consumer demand for Make It Work services will change. Barriers to entry to this market space are also low, because any company providing IT service can imitate the business model to a certain extent rather easily. Therefore, competitors can easily enter the market when the market turns out to be very lucrative. There are a large number of companies doing IT-type service activities in Southern California as seen in the example Google map below. They range from one-man shops to corporate giants such as Best Buy with its Geek Squad. Granted, Make It Work has an execution advantage with its laser-like focus on extreme customer delight and its real-time IT-enabled capabilities, and its blend of computing and digital home entertainment, but that does not limit its exposure to competitors with deep pockets trying to imitate that, or innovating with new business models. 12 USC MIW Case March 2010 Evolving with New Business Models: As the World Turns Make It Work’s homepage suggests that a new business model may be brewing for delivering extreme customer delight and for growing delighted customers. The portfolio appears divided into three: “On the Ground” (Onsite Technology Service & Support), “On the Air” (The Latest Technology News) and “Online” (Interactive Webinars). And while Make It Work’s internal credo is “Always On It !” the website sports a contrasting and soothing trademarked “For a Stress-Free Digital Lifestyle..” Is this a display of the yin and the yang of digital ecosystems, or is Make It Work’s business model evolving and changing ? In 2009 and 2010, Make It Work has made big strides in stepping up its radio presence in Los Angeles and San Francisco with the Tech News channel that is enjoying wonderful ratings, great sponsorships, and an increased following. By keeping pace with their business expansion to other big US cities, they plan to broadcast Tech News in over 20 US cities, including New York, Washington D.C., Chicago, Dallas. Similarly, the online interactive webinars have generated a big following. Furthermore, Make It Work has expanded its educational activities in some of the communities they serve and have held “Poogling” seminars. Poogling (a play on Poo and Googling)are free community seminars that educate parents and protect children online from browsing controversial subjects (e.g. sexuality, bullying, eating disorders, suicide) that could lead to dangerous exposure on the internet out of curiosity and the intimidation to ask others (e.g. family, friends, teachers, or peers). These seminars help parents tackle the growing problem of Internet social networking for children and other perils associated with online behavior 13 USC MIW Case March 2010 Most recently, the CEO of Make It Work is hosting one of the trendy TEDx events http://www.ted.com/tedx around technology, entertainment, and design -- and the Make It Work portfolio mix may be shifting some more (see screen capture from MIW events page below ). Is this foray into the media, and educational/event space, an evolution of Make It Work’s niche in the digital ecosystem? Or is it a new business model ? Or is it just a way of boosting consumer confidence and comfort with Make It Work by changing the revenue equation for the existing business model ? Is it just another way of growing more delighted customers quicker ? Or is Make It Work setting its sights on much further away destinations and goals? After all, Eric Greenspan’s e-mail signature reads “To the Moon”… Pondering Future Growth Eric Greenspan and his management team are pondering the future growth of Make It Work. They are looking for their next expansion into other areas of California and other states. They are looking to continue their quest to grow delighted customers and fans. They are expanding their media presence on the air, online, and through social networks, and events. They are continuing to seek strong partnerships with technology partners. They would like the well-reasoned analysis of MBA students in answering the following questions: Q1: Identify and assess the importance of Make It Work’s IT-enabled real-time response capabilities in supporting their customer-centric strategy and business model. What would you do to further enhance that capability ? Q2: Assess Make It Work’s business model and compare it to Best Buy’s Geek Squad business model, while taking into account their relative positioning in the digital ecosystem. Use the CTM VISOR framework2 or any other systematic business model framework for your assessment. Q3: What expansion strategy and associated business model would you recommend for Make It Work as it heads into its next growth spurt ? Please justify and explain your recommendations. Please identify the associated risks and vulnerabilities for the business model you propose, and any measures that need to be taken to manage competitors and complementors in the digital ecosystem niche that they choose. 2 www.marshall.usc.edu/ctm 14 USC MIW Case March 2010 EXHIBITS Exhibit 1 Delight Dashboard 15 USC MIW Case March 2010 Exhibit 2 Yammer 16 USC MIW Case March 2010 Exhibit 3 Make It Work Customer & Revenue Growth Trend-line for Services 17 USC MIW Case March 2010 Exhibit 4 Digital Bulletin Board both for Web and for iPhone – MIWALL