Inside the Tornado: Strategies for Developing, Leveraging, and Surviving Hypergrowth Markets (Collins Business Essentials) [Englisch] [Taschenbuch]

Inside the Tornado is the 1995 sequel to the 1991 book, Crossing the Chasm. Inside the Tornado repeats the arguments of Crossing the Chasm, and adds three new stages of how to manage a business during the lifecycle of a technology. While Crossing the Chasm was primarily about marketing with some strategy emphasis, this book reverses the emphasis. I recommend the 1999 paperback version because it contains a new introduction that serves better as a helpful afterword to the book, as Mr. Moore suggests, in updating it for the Internet.

In Crossing the Chasm, Mr. Moore successfully argues that new technologies first attract customers who love technology, and will try anything. If you succeed with that group, you will next attract visionary customers who will want to use the technology to steal a march on their competitors. After that comes the chasm, getting into broad acceptance. Many technologies never make it. The method to cross is described in Inside the Tornade as the bowling alley. You pick a few key segments that may reflect the needs of other segments. By providing custom solutions for these segments, you create a ricochet effect into striking good solutions for other niches. The analogy is to the way that after the bowling ball first hits the one and three pins (for right handers) and then continues on to take out the five pin, those three pins hit the pins behind them, which in turn go backward to take out the pins in the final row, until you have a strike.

The tornado is the period of mass market acceptance. This is when there is a lot of demand as everyone who decides about infrastructure adopts the new standard simultaneously. You have to standardize, get your costs down, and ship at low prices. Your strategy is just the opposite of the bowling alley period. The metaphor here is to the tornado in the Wizard of Oz that sweeps Dorothy, Toto, and her house from Kansas to Oz.

Then comes Main Street, when the market demand is now filled and you are looking at "aftermarket development, when the base infrastructure has been deployed and the goal now is to flesh out its potential." You once again focus on segments, and create custom solutions.

The final period is End of Life, when "wholly new paradigms come to market and supplant the leaders who themselves had only just arrived." In essence, you start a new technology cycle. The best companies (like Intel) will do this to themselves.

The book also describes the importance of becoming the gorilla who will have about 50 percent market share and earn 75-80 percent of industry profits as a result of dominating the tornado period. Gorillas are made during the tornado. Oracle is described as an example.

During the bowling alley your company needs to be very good at product leadership and customer intimacy, during the tornado you need to shift to product leadership combined with operational excellence, and in Main Street the focus is on operational excellence and customer intimacy. This thinking will remind you of the book, The Discipline of Market Leaders, and the work of Dr. Adizes. Most companies will not be agile enough to make these transitions. Examples abound in the book. Apple's example will hit home with you, I'm sure.

As to the Internet, things are different. In the original book, the Internet is only mentioned three times. In the introduction here, Mr. Moore says that the "Internet market tornado, however, is so powerful that it has sucked all four models into its vortex." Companies are succeeding simultaneously in different parts of the Internet space at the same time with each of the strategies outlined here.

In the future, I think technologies will evolve more like the Internet has. During these evolutions, I think that business model discontinuities will be more important than technology discontinuities. While you can only put technology discontinuities in during parts of the cycle (never during the tornado), business model shifts can occur at any stage. Also, it is easier to shift business models than to shift technologies. Business model shifts affect your own operations more than customers, while technologies have a large impact on customers. My current work is focused on how the two need to interact with one another, which is not addressed here.

After you have read this excellent book, I suggest that you consider the organizational planning issues required to create such a multi-faceted effectiveness. For example, you may find it easier to have two organizations. One will focus on creating custom solutions, while another focuses on mass market solutions. In that way, you can hedge your bets with predicting the timing of each phase.

May you always focus your attention on the most important activities required by the markets you serve!

In December 1995, I read an excerpt from this book in Success Magazine. I made it a goal of mine to identify and take advantage of the next big tornado market to hit the US. By then, the Internet was already taking off, and in my opinion, the door for first movers was rapidly closing.

I began to study technology, based on the premises put forth in this book, in attempts to identify the next major market. After several years of study (and no tornado markets spawning), it became apparent that the wireless internet, or mobile data industry had all of the makings of a full blown tornado market. In late 1999, after four years of research and a constant re-reading of the Bowling Alley, the Chasm, the Tornado and Main Street, I co-founded a Professional Services and Software Development company in the mobile data industry, which over the past 8 months has become the hottest industry on the face of the planet. The understanding of the technology adoption life cycle that I gained from this book provided me the opportunity to be a first mover in this space, which is sure to be a full blown tornado market.

I can't tell you how many copies of the Dec 1995 Success Magazine article that I have given out in over four years, in an attempt to help others on their journey "In Search of the Tornado Market." To my knowledge, noone that has received this article from me has identified a major market. It just goes to show that opportunity will knock for everyone, but few will answer.

I just wanted to give a personal thanks to the author for having such a profound impact on my life and the lives of so many people. I also have bought the 2nd version and would recommend it.

I consider this book a fraud. The key element, "The Tornado" which the author claims to be a new concept is a pale copy of early works of Peter Drucker(e.g."Age of Discontinuity" [1978])
and the excelent book by Richard Foster "Innovation - The attacker's Advantage" [1986].

Besides, two chapters seems like low quality summaries of Al Ries & Jack Trout's "Positioning: The Battle for Your Mind" [1985] and Michael Porter's "Competitive Advantage : Creating and Sustaining Superior Performance" [1985]