Home Latest Insights | News The One Oasis Strategy

The One Oasis Strategy

The One Oasis Strategy

Last week in Lagos, I ran a Board Meeting strategy for a major client. The business had many products and was looking at how to coordinate capital investment to ensure optimal asset allocation and utilization. Our job was to drive the visioning process to make sure investments are synergistic across the product lines. During my work, I introduced my clients to One Oasis Strategy (my phrase) which I have used with major clients in U.S.  You will read an extended piece if you subscribe to Harvard Business Review print.

Before explaining the One Oasis, let us refresh what oasis means:

In geography, an oasis is an isolated area in a desert, typically surrounding a spring or similar water source, such as a pond or small lake. Oases also provide habitat for animals and even humans if the area is big enough. The location of oases has been of critical importance for trade and transportation routes in desert areas; caravans must travel via oases so that supplies of water and food can be replenished. Thus, political or military control of an oasis has in many cases meant control of trade on a particular route.

Indeed, oasis is very critical and every company has oasis. Your best product is the oasis in your business. Every other product feeds on that best product. If you build your investment around that main product, you will find success, because those investments will have a clear “customer”, and that reduces market risks. In other words, if your new business investments are geared to support the best product, and the best product is doing well, it means the risks on the new investments will be easily managed. Provided the best product continues to do well, demand on the new investment is assured. That is the One Oasis Strategy.

Tekedia Mini-MBA edition 14 (June 3 – Sept 2, 2024) begins registrations; get massive discounts with early registration here.

Tekedia AI in Business Masterclass opens registrations here.

Join Tekedia Capital Syndicate and invest in Africa’s finest startups here.

Every product is like the animal that returns to the oasis for water. Every product is like the humans that depend on the oasis for habitat. Provided that the oasis is there, and doing well, their survivals are guaranteed. Yet, as those new products do well, they could find new customers, beyond the first customer (that best product). That means, you can introduce them to the markets for other customers to buy, even when they are supporting the best product, which is the most important reason the original investments were made.

For my client, we spent time and agreed upon the best product in the business, using many indicators including brand, financials and market positioning like market share, etc. We then worked on how investments could support that best product while also having the capacity to serve the broad market in future. We want the best product to be the category-king and purely peerless in the industry. The massive accumulation of capabilities in the company to deepen its position was designed to make that happen. We structured some business lines and reshaped how some products were made. Simply, we engineered a One Oasis Strategy. I have so much confidence that my client has paid for elite insights.

An oasis (istock photo)

Cases of One Oasis Strategy

In this section, I will explain two companies which have used the One Oasis Strategy.

Amazon: Amazon is an ecommerce company with massive user base. It supports billions of transactions in a year and needs computing resources to keep its portal functioning well. Amazon could have called IBM to rent a cloud infrastructure for its ecommerce. Rather, Amazon decided to build one in-house knowing that the future of its ecommerce will be driven by the capacity to offer great experiences to clients. The cloud infrastructure investment is necessary as growth in the ecommerce keeps going up. It does not make sense to be sending that money away. So, Amazon went and invested in cloud. The ecommerce is the oasis and the cloud is like the animal that finds habitation from the oasis. Provided the ecommerce is doing well, the investment in cloud has minimal risk. The first customer to the cloud business was ecommerce and that means Amazon does not have to worry if there is any external customer for the cloud services. Amazon does not need to check market dynamics to invest in cloud provided its ecommerce business is doing well.

But interestingly, after time, Amazon did find opportunities in the external market to sell its cloud services. Those services are now called Amazon Web Services (AWS). Tekedia is hosted on AWS, just as many websites which include brands like Dropbox and Instagram, present or in the past. The oasis (the ecommerce) has been served by the new product (cloud) and now that new product is making profit for Amazon.

Samsung: In the global semiconductor business, Samsung is one of the most prominent companies. Others are Chartered, Intel, TSMC and GlobalFoundries (old IBM). While Intel makes chips it sells to customers to be bundled in products, it does not have any direct customer-end products of itself. Others are largely pure foundries. But Samsung is different: it makes all these chips, fabricates them, and it has products in the markets that use them. The Samsung Galaxy series is the best Samsung product, an oasis, which the semiconductor is serving.

This is what makes Samsung competition with Apple very interesting. It can afford to invest in new memory chips and OLED display irrespective of what the market trajectories are. Why? The first customer to Samsung semiconductor business is Samsung mobile devices unit. That means Samsung semiconductor has an incentive to innovate because it wants to make the best mobile devices in the world. No other company in the world has those capabilities, at scale, as Samsung.

Between Apple and Samsung, Samsung is a better business in terms of re-positioning, but Apple is a fashionista brand which makes customers great fans. Samsung has better engineering, but Apple builds better customer perceptions on products. But when you look deeper, you will notice that without Samsung, there will not be any Apple iPhone in this world, at least at its quality level. Samsung will make about $110 from each iPhone X sold.

Simply, with this capacity to feed the oasis, knowing that Samsung semiconductor has no risk in the business, it makes it harder for competitors who are in OLED display and memory chips. Those competitors have to find customers, and then get their assurances they will stay with them for long. But Samsung semiconductor has the customer in-house and can wager without any risk since its best customer is a unit in the group business. That explains why Apple has been unable to find an alternative to Samsung in supplying these critical components used in iPhone: no one can take the risk required for innovation unless Apple can lock in for years. But Apple will not do that. So, at the end, only Samsung has the best product. That is the reason why Apple has to use Samsung, its arch-rival.

Apple along with some investors bought Toshiba memory business. Sure, this new business can see Apple as its first customer, based on the One Oasis Strategy, to invest. But with private equity (PE) firms involved, they will not be in a hurry to invest billions required to match Samsung scale. Apple will not just have to guarantee taking those supplies; Apple has to be ready to pay at the rates that PE will like to see. It is not likely that is possible because Apple is a minority investor which will likely look for the best deal in the market. Samsung has the best price along with the best product. Toshiba has to win on both ends.

All Together

The One Oasis Strategy is about finding how to create solutions which can find their first customers within the business. Amazon Cloud has the ecommerce operation as its first customer thereby removing any market risk. Samsung Semiconductors has the Samsung mobile devices business as the first customer. With those assured internal customers, these firms deploy resources, irrespective of the market dynamics, because they have found the first customers already, in-house. But over time, the products are now made available to the general public. You need to identify your best product (the oasis) and get others to find how to build habitations around it.


---

Register for Tekedia Mini-MBA (Jun 3 - Sep 2, 2024), and join Prof Ndubuisi Ekekwe and our global faculty; click here.

No posts to display

18 THOUGHTS ON The One Oasis Strategy

    • It would have been great if you explained the backward/forward integration for the readers. But largely, the oasis pushes companies to focus on ONE core product and builds everything around it. In B/F integration, you can have many products in the business competing for attention and ways to integrate. Largely, you would not have a single oasis. The use of ONE is vital especially for startups where I push that they focus on one core product and then make it the best possible under the winner-takes-all environment where only the best wins. Having 20 products may not be useful- you need one and that one must be a category-king in its category. This is not about integration processes. This is about an evolutionary strategy of alignment of capital. In One Oasis execution, you can apply B/F integration. The latter is operational, the former is strategic.

  1. Well done Mr Ndubuisi. I only discovered Tekedia recently and I’ve been purring through your articles. Amazing insights. Please do you offer tech strategy sessions for startups? We’re in the finishing stage of developing a digital product which we believe ticks the One Oasis and Duality Element boxes. We’ve validated the idea using a minimum viable product and would love to get you insights on board as we get set to launch in December.

  2. I always come back to read this article every time. It has my focus railed on creating a core product with dual values to serve as a main stream. I thank you sir for your valuable insights.

    I do hope we will get to see and discuss.

  3. Thank you very much for sharing sir.

    You said, Your best product is the oasis in your business. Every other product feeds on that best product.

    What if your best products are seasonal, By that I mean A product is only best for a time. And when season changes it’s another product?

    Thank you once again.

    How can I be part of your the mini-MBA you mentioned?

  4. Great one my Prof, the day i can to know about you through linkedin after reading your article , you became my mentor immediately because i saw wealth of wisdom coming out from you.

  5. Great one my Prof, the day i can to know about you through linkedin after reading your article , you became my mentor immediately because i saw wealth of wisdom coming out from you.

    …..Bravo My Prof

  6. This is very insightful! Thank you for sharing such a wealth of business wisdom! I’ll surely save this article as I’m in the phase of generating business ideas to go into.

Post Comment

Please enter your comment!
Please enter your name here