Established 1996
How Digital Leaders Outperform their Peers
The gap between the digital Haves and Have-nots has been steadily expanding. While a lot of organization on either camp are similarly invested, the real difference between their lot tends to be in decision making. A study was conducted to look into these crucial differences and thus some solutions have emerged. First of all, companies must be true to their founding values and the corresponding corporate strategy must be framed in accordance just as Lego renewed itself using own competitive advantages. Another point is that while rejigging the IT capabilities for the digital age, it is important that companies build the entire capacity to fit in with their business model as done by the likes of Airbnb, Nordstrom, Uber, Lending Club and Task Rabbit. While costs need to be cut, the saved amounts need to be invested in reimagining the world according to present business conditions. Challenges need to accepted and defunct models of yesterday dumped just as what State Street bank did by expanding into business analytics capabilities. In order to really win big in business, the existing work culture needs to be tapped in to drive increased energy in the team just as Zappos has done. Whatever is the decision made, it has to align with customer requirements and demands with IKEA being a prominent example of this approach being met.
Source:https://www.strategy-business.com/blog/How-Digital-Leaders-Outperform-Their-Peers?gko=324ad
Uploaded Date:06 October 2017
3 Ways M&A is different when you’re Acquiring a Digital Company
Mergers and Acquisitions (M&A) is a popular method for companies to grow inorganically. However, it does not work on a one-size-fits-all principle as it is especially unique when acquiring digital companies. One such difference may be observed at the financing stage. As a lot of digital companies are valued in terms of future expansion or goodwill rather than existing or physical assets, overvaluation is a common occurrence. This could lead to future write-offs, thus the acquisition must signal a change in the corporate strategy where this deal is part of a series of upcoming ones to propel the company’s push towards digitization. Also, the financing must rarely be fully by cash, but other modes of payment ought to be considered. Another change is the due diligence process. In deals with traditional companies, the valuation is based on current value, but in digital companies, a futuristic dimension needs to be applied. Tools exist to ease this process such as CB Insights, Quad Analytix and Sysomos which provide cutting-edge business intelligence on various related aspects. Another challenge is integrating this acquisition without killing it. A thorough investigation needs to be carried out on which aspects the new entity will complement the existing establishment. When the acquisition is only intended to enhance a particular function, then incremental alignment works. But for disruptive gains, a complete streamlining is necessary.
Uploaded Date:20 July 2017
To Reinvent your Firm, do Two things at the same Time
Due to the digitization at play across industries right now, newer business models are getting created and older ones disrupted constantly. Disruption need not be a negative word as often perceived. Instead it is the game-changing moment when an upstart becomes the business leader and legacy companies may look clueless. Kodak is a poster child of this occurrence as it failed to beat off competition from film based cameras. A partner at management consulting firm Inno-sight provides some useful insights on this happening. He says that two things are needed in order to embrace business disruption. One is to reposition the existing business to ward off the disruptors. The other is to actually take advantage of such changes and win business value oneself. This cycle will complete what is known as Dual Transformation.
Uploaded Date:14 July 2017
Good Management Predicts a Firm’s Success better than IT, R&D, or even Employee Skills
Sports is one field where team managers are consistently either praised to the hilt or derided for the performances. In the business world, the glorification of management practices though is less obvious. To cite an example management consulting has long been known as a profession where the expert simply arranges already known obvious facts in an aesthetic manner. This perception however is inaccurate as a recent study on firms’ performances vis-à-vis the practices adopted shows. Data is paradoxically low when it comes to the field of management, and even the material available is often in the form of case studies on top companies taught at various MBA institutions. Thus in this latest study a more holistic approach was adopted with manufacturing plants all over the US sampled. Questions were phrased under three broad heads- monitoring, targets and incentives. It clearly emerges that only a fifth of them make use of the latest management practices recommended but these were far more productive. For each ten percent increase in adoption of best management practices, there was a fourteen percent productivity increase. There was even a difference in performance within the same firm’s separate plants. Other factors were also studied and it emerged that for every increase in productivity, eighteen percent may be directly attributed to management practices, a bit less to research and development, then come employee skills and finally IT investment at single digits.
Uploaded Date:07/07/2017
The Six Types of Successful Acquisitions
There are all kinds of acquisitions in the business world, but some more successful than others. In order to be in the former category, six broad types have been identified. In neither case, will overpaying for acquiring ever work. One such corporate strategy for acquiring is to improve the other company’s performances. Another is to remove excess competition from the market. Sometimes smaller companies may have great produce or service in their portfolio but being small limits their market access which may get rectified by such an acquisition. It will also help in scaling up the business’s industry-specific capabilities. Another factor in the acquisition could be inorganic skill or technology capture at lower cost than building in-house. Savvy acquirers identify winners early on and facilitate their seamless growth.
Uploaded Date:05/07/2017
Great Businesses Scale their Learning, not just their Operations
There is enormous focus these days on technologies that create new business models. While static knowledge is important, it is evolving at alarming rate due to such technologies taking over. Similarly, the return on assets in public institutions in the US has gone down to a record low. A study conducted by business consulting firm Deloitte revealed that more than three-fifths of employees’ productive time is spent on resolving exceptions rather than executing tasks. Most organizations these days are leveraging new technologies to automate tasks and reduce jobs. This is a trend going back to the Industrial Revolution when there was a huge time lag between growth of actual productivity and the introduction of machinery. This is because the workers took time to develop such skills. So that such a repeat does not take place, the really great business must use technology to scale their learning and not just operations. Business transformation demands that the existing workers be provided management training on these new skills so that the company can cover up for these trends. Such learning will also accelerate with work environments getting a design facelift with physical, management and virtual systems being interconnected.
Uploaded Date:29/06/2017
What U.S. CEOs can learn from GM’s India Failure
General Motors (GM) and Ford, both American automobile giants have never occupied a double digit market share in India. GM has recently even announced an exit plan by the end of the year from the country. This and the exits of other American multinationals such as Mary Kay raises several questions about why certain American companies are failing in this market which now attracts greater FDI than China even. Generally speaking, European and East Asian brands seem to have greater presence in India. Yet, several American companies have been successful such as PepsiCo, Coca-Cola, Cisco, Boeing, GE, Cummins, HP, Google, Dell and McDonald’s. Certain key reasons exist for this lopsided success ratio. First of all, a consistent leadership over time is crucial in this market as India is a complex one consisting of a mix of Western and Asiatic values. GE for example has had a single leader over the last fourteen years as opposed to the constantly shifting leadership at GM. Local leaders need autonomy to even tweak products or servicing suited to the market as done by PepsiCo in launching Kurkure snacks, Whirlpool during their campaign to attract hand washers to washing machine and by Western Union for partnering with the national postal services. Since GM’s competition is expected to be India-centric, the corporate strategy too needs to be centred around such a philosophy as done by Japan’s Suzuki and Korea’s Hyundai. GM is a mass player, and thus their focus should not be limited to the top of the pyramid but also reflect towards the middle of it to truly take advantage of the market. Finally, every entrant into India must recognize that there will be no instant gains, but only long-term thinking ought to succeed. PepsiCo and Boeing both followed this approach.
Uploaded Date:29/06/2017
Obsess over your Customers, not your Rivals
Usually most companies set others in the same industry as their main rivals. This however deflects attention from the genuinely main competition, which is a market trend to reject the product or service altogether. A focus on customers ultimately brings more benefits to marketers than any similar focus on competitors. Thus for a health maker, the main rivals are fast or junk food producing companies or the natural human tendency to crave fats and sugars. Thus the marketing team’s time or effort needs to be re-geared in certain ways. Firstly, there must be a rethink on what exactly is the mission or corporate strategy of the firm. This involves a rethink on what exactly is being sold and how is it relevant to the customers. Then, a rethink on the wider customer base is needed which includes not only present buyers but potentially all who may end up using the service or product. Their problems must be listed in order to be relevant to them. This includes obstacles they face in product usage and resolving them. The competition too must be redefined according to specifics of the broader industry rather than using rivals as reference pieces. Content marketing may be used to advertize the benefits of the game rather than attacking rival claims.
Uploaded Date:28/06/2017
Amazon’s Competitive Advantage isn’t cost or convenience, It’s This
Competitive advantage differs from one company to another. Global tech giants such as Apple, Google, Facebook and Amazon are all known for separate niches. What is common between them all is the constant improvisation to adopt. Apple started off as a computer company, but is now into self-driving cars, augmented reality and has even broken into the payment space, traditionally reserved for banks. Google was initially just a search engine, but is now the dominant player in mobile operating systems and the navigation or mapping industry. It has now ventured into self driving cars and its latest business innovation is in internet-beaming balloons. Facebook isn’t just a social network, but a producer of augmented reality glasses and is now experimenting with the possibility of typing being done by the brain. The biggest differentiator for Amazon is the sheer convenience that gets induced. With the click of a button, one can order anything delivered to one’s doorstep. Its latest merger with Whole Foods though will have challenges, as the company cultures of the two are totally disparate. Establishing cross-pollinated teams will now be a challenge.
Uploaded Date:27/06/2017
11 Types of Strategic Maturity: Which one describes your Company?
Different companies stand at different stages in terms of strategic maturity. A study has been conducted by PwC’s research arm to gauge the maturity levels of companies’ corporate strategy. Eleven levels have been identified. One of them is strategically adrift where the firm is on the verge of failing or simply lucky to still survive. Then there is undifferentiated where the final product or service is not unique enough to make a dent in the market. The third variety is underleveraged. These are firms where several aspects are well executed, but there is lack of coherence between various components. Another is the portfolio-constrained variety where products or services offered are too many leading to chaos in their execution. A fifth variety is unfocused. Here the company is good at several tasks, but not particularly renowned at anything. Distracted are the ones that do have a coherent strategy, but keep getting sidetracked. Resource-constrained ones are those that struggle to arrange the funds to execute to diverse tasks at hand. Capability-constrained on the other hand are those that simply lack the intellect or knowledge to build capabilities. Another version is overstretched. These are those that do have a proper identity, but the actual execution is veering away from main goal. The tenth and best type so far are the coherent ones. They are truly aligned to their goals. The super-competitors lie on top of the pie. They are not only coherent but constantly strive to do newer things with full perfection.
Uploaded Date:27/06/2017
What’s your Strategy to create a great Company Culture?
Due to the digital nature of modern workplaces, employees across the board are struggling with work-life balance. There is the constant pressure of work through the connected environment so people are constantly under the scrutiny of work. Management consulting giant Ernst & Young has outlined through its latest research that a full third of full-time employees surveyed revealed a struggle to them is where incremental changes are made, while the other focuses on the bigger picture. In the first approach, adopted by The Glint and Rakuten Marketing, a community feeling is being fostered at the workplace. People must feel the connect so common spaces have been designated and days earmarked for fun, social events among employees. They are being encouraged to go home with a free mind and not carry work. The other approach tries to rectify from the very route through three steps. They listen to employee recommendations, leverage existing solutions for business advantage and get all employees hooked to the work process. At such places, the talent recruitment is particularly crucial so that there is the correct match between organization and employee culture. The likes of BMS Software, DISYS, Siegel + Gale and Omega have adopted this technique.
Uploaded Date: 19/6/2017
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