Based on nearly 25 years of industry experience and some hit-and-miss strategies, Sun is hitting the mark with its vertical industry strategy. Senior VP of the Strategic Insight Office, Larry Singer, shares his take on Sun's "componentized" industry strategy and offers insights into how companies both large and small can gain ground on the vertical industries they wish to play in.

Q: What are the components of an effective industry strategy?

A: The first thing to understand is where you are today — what is your existing customer base, where is your revenue coming from? Once you know this, you can decide whether you want to focus on growing your business in those industries where you have a strong position or whether your focus is on acquisition in a new industry.

Before Sun began its focus on select industry offerings, we had a high concentration in three areas — financial services (primarily capital markets), government, with a large share coming from the United States defense and intelligence agencies, and communication, with a strong emphasis on telecommunications service providers. Without a focused industry effort, we still had very high clustering in those industries because of the natural affinity for our products based on the processing requirements of those industries. They all are early adopters and users of the most advanced technology solutions. With Sun's reputation and focus on excellence in research and development it was a natural affinity.

So for us, we had to understand why we were strong in those industries and then we had to determine whether we wanted to double down in those industries or use our resources to create similar wins in secondary industries.