Kittyhawk

Product Vision – HP DMD wants to be a major player in the disk drive market.

Kitty Hawk Project –

Creates heavyweight project team (best and the brightest)

- Co-locate the team the team in separate facility

Seperates team from the rest of the division

Product Vision: small, dumb and cheap

Company places big bet and heavily resources kitty.

Divisions best engineers taken off sustaining 5.25 and 3.25 in projects to work on kitty Hawk

Kitty Hawk Charter –

Introduce product in 12 months from start to finish

Accomplish a break-even time of less than 36 months

Achieve a $100 million in revenue 2 years after launch

To be the 1st to the market with a 1.3 inch drive

Grow faster than the disk drive market and become a significant growth leader.

Revenue growth rate should remain at 35%

Kitty Hawk Market-

Low end game market (ex. Nintendo)

Need cheap storage

Nintendo during the Christmas season ships 1.5 million/day

Mobile computing (ex: PDA)

Kitty Hawk Performance-

Be able to work after a 3 foot drop

Have a storage capacity of 20 mb

Manufacturing capabilities –

Outsourced manufacturing to citizen watch company and built a capacity of $150000 units/month

Oem pricing - $250

Outcome –

mobile computing – sold 100,000 units instead of plan 700,000

could not enter the game market due to the high cost.

Closed kittyhawk in 1994, product removed from the market.

Dmd revenue flattened since it lost performace edge at 4 gb

Disruptive businesses – sustaining businesses need to embrace the disruptive business model.

Set up a separate business unit to develop.

Aggressively look for acquisition targets that are potentially disruptive.