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Corporate Strategy

For long business problems and innovations were approached from the top end of a rigid corporate strategy. It assumed the value proposition to be directly proportional to the relevance of the solution. But now increasingly, business professionals are using the approach of design thinking. This approach understands that human buying decisions need not always be rational. This is why designers are now being roped in to solve business problems. They inherently have an outside-in approach so they can gauge customer requirements more intuitively. Their structured and creative interpretations enable insights to translate towards actions. The approach will formalize towards a generative problem solving. It also helps in formalizing ideas around whom no historical data is available, as was the case with the founders of Airbnb who had a certain belief. It is increasingly being used for product development and curating customer experience. As per present trends, even culture and trust will eventually be curated using the help of designers.

Source:https://medium.com/digital-mckinsey/designers-are-solving-business-problems-whats-next-247ca68309c5

Uploaded Date:17 May 2018

During the age of the Industrial Revolution, the most important component driving business success was financial capital. Finance gave companies access to markets and funding. As it gave way to the twentieth century, two other important aspects were added. They were natural and human capital. The former provided companies with seeming unlimited resources, while the latter enabled the best of talent recruitment. Now in the digital age, three more forms of capital have further been added. They are behavior, cognitive and network capital, collectively known as BeCoN. The most successful of companies in the ongoing digital age – Apple, Amazon, Alphabet (Google), Facebook and Microsoft- are those who have all six of these forms of capital in abundance. Behavior capital is the process of data warehousing which enables companies to track enormous amounts of customer related behavioral insights which can be processed before decision making. Cognitive capital includes algorithms that help break such data sets through codified knowledge flows. Network capital is what keeps all the other points connected to each other. It encourages collaboration and has led to the establishment of the sharing economy exemplified by the likes of Netflix.

Source:https://www.strategy-business.com/article/The-Bionic-Company?gko=25219

Uploaded Date:17 March 2018

The digital age calls for agile organizations. After much observation, it has been deduced that this kind of agile transformation works best through a series of pilot programmes. To get such programmes off the ground, companies must first identify a fighting unit. Their number has ideally been pegged at one hundred-and fifty, divided into cells of seven to twelve people in each. This number has emerged from a study known as Dunbar’s Number. While corporate strategy still has its place of importance, agile systems work best when these are not rigid, set-in-stone. Instead, the must be continuously evolving to absorb emergent ideas or firefight ongoing challenges. Nothing beats testing-and-learning. This principle is why in the first-place pilots get launched. The experimentation may be within a controlled group, so flaws may get rectified before they go public. Management training programmes need to be simulated so that prototypes may be put to the test.

Source:https://www.mckinsey.com/business-functions/organization/our-insights/the-organization-blog/get-agile-faster-through-pilot-programs?cid=winningtalent-soc-twi-mkq-mck-oth-1803&kui=P6iQpUmqTOA4YG-YaE99nA

Uploaded Date:17 March 2018

Amazon has now entered the banking industry in a big way, creating massive opportunities as well as threats to some. However, the threats will be mitigated by the fact that Amazon does not wish to become a bank itself, but simply act as the digital partner to several clients who would be holding all the deposits. One segment of the market where Amazon would be able to make the biggest impact and be benefitted itself is the young-depositor category. Youngsters usually possess lesser money and are used to free-use accounts. This makes them an unprofitable proposition for many, but not Amazon which sees them as an opportunity segment. Youngsters’ usage patterns will provide Amazon a source for enormous amounts of data warehousing. This data will then be used to predict and create demand for futuristic products such as Alexa, which this segment is most likely to use over the years. Once Amazon establishes itself into this co-branded strategy, the company is likely to venture in financial products.

Source:http://www.bain.com/publications/articles/bankings-amazon-moment.aspx

Uploaded Date:16 March 2018

Being good at talent recruitment is only half the task done. Matching the recruited personnel to their skills with the right position is the other half. Here, many companies come short. A lot of companies even make the mistake of bundling roles such as putting IT under finance, just because they did not have the right personnel for the former. Certain techniques have been identified which if done the right way, can help bridge this gap. First of all, the people responsible for the right fitment must understand how value gets created using these pieces in the puzzle. The thinking must look at both present performance as well as future growth. The most important roles need to be identified at first, so that others may smoothly follow on. The use of data may be made to analyze the right talent for their kind of suitable roles. Developing talent isn’t all about providing corporate training sessions. Instead, it is about managing the performance during their real-time work so that intervention is authentic.

Source:https://www.mckinsey.com/business-functions/organization/our-insights/the-organization-blog/4-strategies-for-linking-talent-to-value?cid=winningtalent-soc-twi-mip-mck-oth-1802&kui=2_ZGUXtys_eUtDYcKAndug

Uploaded Date:16 March 2018

There have been numerous articles on company growth, yet this concept itself has seen a vast change in the ongoing digital age. This is because, unlike the earlier times, when those growing had to take systematic, strategic steps, now singular, bold steps may do, if executed properly. Now, even the industry incumbents need to up the ante, or else they may see their turfs being taken over. Due to a generally slow GDP growth globally, there is now a focus towards cost containment. Business research conducted by McKinsey clearly shows how the onus of innovation and growth lies with the top management of companies. They need to understand that performance and creation are essential drivers of such a thinking across the organization. The corporates also need to practice dexterity as a singular approach may not always work out, so a multi-pronged one insures somewhat against dynamic risks. But before approaching one’s colleagues, the senior leadership team needs to self-diagnose the existing flaws within the company.

Source:https://www.mckinsey.com/business-functions/digital-mckinsey/our-insights/setting-an-agenda-for-organic-growth-in-the-digital-age

Uploaded Date:16 March 2018

The considerations for making deals in B2B business arrangements versus individual shopping appear vastly different, yet on closer scrutiny are not as apart. Of course, the former will look into aspects such as warranties and the value reflecting upon the level for whom purchased, while the latter will be about personal preferences. But deep down, just as renowned management thinker Abraham Maslow brought out his Theory of Needs for individual users, similarly industrial buyers too, seek value across levels. A study conducted by business consulting giant Bain has divided all such needs of industrial buyers into five levels. If one starts at the basic level, one begins with the Table Stakes which includes meeting specifications, regulatory compliance, ethical standards and the acceptability of the pricing set. The second level is about the functional value which may be divided into Economic and Performance. The former would include cost reduction, but improved sales while the latter speaks about the quality of product, level of innovations and the scalability of operations. The next Ease of Business tackles several broad topics such as productivity, access, relations, the corporate strategy envisioned and its operational implementation. The Individual level comprises of one’s personal needs as well as the career trajectory. At the very top, one finds the inspirational value comprising of the vision, hope and ensuing social responsibility.

Source:https://hbr.org/2018/03/the-b2b-elements-of-value

Uploaded Date:16 March 2018

Across rounds of executive coaching, trainers have realized that quite to the contrary of what they say, most leaders tend to be oblivious about their weaknesses, but fully aware of their strengths. While all human beings have their own weaknesses, many of them may not manifest at work. Some fatal flaw however, may prove to completely bring down a leader. In spite of other qualities, if someone as seen to be particularly bad at something major, it can prove to be hindrance. Since a weakness is due often to inaction, they are less well identified. Leaders with such fata flaws have been observed to be poor atstrategic thinking. The leader can gauge insights about the perception about himself/herself by enlisting the services of some “truth teller” who will provide honest feedback. If this doesn’t work, the leader may consider external talent recruitment to bring new ideas to the firm. An increase in self-awareness is essential to the right form of leadership.

Source:https://hbr.org/2018/02/most-leaders-know-their-strengths-but-are-oblivious-to-their-weaknesses?utm_medium=email&utm_source=newsletter_weekly&utm_campaign=weeklyhotlist&referral=00202&spMailingID=19088896&spUserID=OTY0OTMwNTk5NwS2&spJobID=1201699181&spReportId=MTIwMTY5OTE4MQS2

Uploaded Date:03 March 2018

Historically, most private companies have been focusing solely on TSR (Total Shareholder Returns). This, has prompted a sense of short-termism where profits are all that shareholders have cared for, while societal issues, often created by these companies in the first place are dealt by the government or non-profit firms. This trend is changing due to increased societal awareness, and shareholder pressures. Shareholders are now more ware of the ESG (Environmental, Social, Governance) concept than earlier. Private companies are also to play a part in meeting the UN’s SDGs (Sustainable Development Goals). TSR has thus been replaced by TSI (Total Societal Impact). SRI (Socially Responsible Investing) has also increased in scope. One of the major benefits of this TSI approach is the opening up of new markets, to underserved communities often leveraging partnerships. Costs can be reduced and risks mitigated within the supply chain. Due to a better company image, talent recruitment and further retention will be boosted. This will further enhance the brand value, which will allow for premium pricing. It will also spur business innovations as rampant use of resources will no longer be possible, so improvised solutions will be needed. Eventually, the company will find a place within the overall social and economic fabric.

Source:https://www.bcg.com/publications/2017/total-societal-impact-new-lens-strategy.aspx

Uploaded Date:03 March 2018

While sustainability is a word that has found a palace in the lexicon of most people, few are genuinely hands-on in doing something about it. The general belief is that it is someone else’s job. And that is why, the carbon emissions are increasing for most of the world’s biggest companies, and even at the board levels there is little in the way of systematic sustainability audits. The companies that have successfully managed to have any effect, are the ones that have inculcated a sense of ownership towards the cause among its employees. This sense of ownership is equally good for the company’s talent management practices as this inevitably leads to improved job satisfaction. A framework can be adopted across the board for the effective implementation. This framework need have three phases that are- incubation, launch and entrenchment. At the incubation stage, as successfully done by ING, a sense of purpose ought to be established, so that the employees feel themselves valuable enough to be contributing towards a greater cause. At the launch phase, specific plans are detailed team-wise to specify the inputs and expected outcomes. Financial services firm Old Mutual conducted specific management training workshops for its senior executives to detail the plans. At the entrenchment stage, these inputs become part of the routine, as it gets deeply embedded within the system as has happened at BASF.

https://hbr.org/2018/02/how-to-make-sustainability-every-employees-responsibility?utm_medium=email&utm_source=newsletter_daily&utm_campaign=dailyalert&referral=00563&spMailingID=19070288&spUserID=OTY0OTMwNTk5NwS2&spJobID=1201484687&spReportId=MTIwMTQ4NDY4NwS2

Uploaded Date:03 March 2018

The giants among digital natives such as Amazon, Tencent and Rakuten from Japan are tough to categorize in terms of industry of belonging. They collectively dabble in several industries and have redrawn the boundaries between each of them. This would be unimaginable in the traditional sectors. Technological changes have over time led to sectors being born, disappear and then merge. Banking for example has undergone several changes. Customer expectations too are changing thanks to newer inputs being available for them. Customer-centricity has increased as a pillar in businesses. All strategic decisions companies are taking are based around insights derived from enormous sources of data warehousing. There exist different stages in the digitation curve. They are needed at stages such as search, acquire, use, maintain, sell and collaborate. The priorities for companies too ought to expand with time. The entire mindset to be opted for must be towards an overall ecosystem. Any business analytics operations to be conducted must be done around the right data available. But all this data will be rendered pointless if brands fail to connect emotionally with theircustomers- existing or potential. The partnerships forged must be based around shared synergies. The aim must be to ensure that the whole is bigger than the sum of all individual parts.

Source:https://www.mckinsey.com/business-functions/mckinsey-analytics/our-insights/competing-in-a-world-of-sectors-without-borders?cid=other-eml-ttn-mkq-mck-oth-1712

Uploaded Date:01 March 2018

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