MANAGING in the

NEW WORLD

Corporate Strategy

A lot of events take place periodically where people try to find meaning in life. It includes those such as Sundance, TED, SXSW, Art Prize and Burning Man. A lot of millennials and gen x-ers in particular are opting for different modes of such meaning making. They are doing it through their vocations and everyday work. Business innovation that is transformative is in many ways an art. It is needed even more in today’s environment as workplaces are increasingly becoming short-term oriented with a me-too culture to remain static. New products, services experiences and business models are bringing out this sense of innovation among the people. A lot of new startups have this spirit of trying out new challenges and working towards a mission. This is in contrast to a lot of older firms that have become too comfortable in their own stasis.

Source:http://innovationexcellence.com/blog/2018/06/29/meaning-making-how-the-innovation-driven-organization-imparts-purpose-meaning/

Uploaded Date:18 July 2018

The platform-based business model is thriving right now. Seven of the twelve largest companies worldwide follow this model. In spite of this, few of the traditional giant corporations have adopted this model. The likes of Alibaba, Google, Amazon, Microsoft, Facebook, Tencent and Apple all rule over huge pieces of the pie. They also have tremendous reach especially through social networks emanating from Instagram, We Chat, WhatsApp or YouTube. This gets leveraged by companies for their digital marketing activities. A digital platform is one with an open infrastructure. They are matchmakers connecting various resource providers towards collaborative innovations. Their ecosystems sprawl across international boundaries. Due to the vast digital activities, they end up performing vast quantities of data warehousing operations, from which business insights may be gleaned. Few incumbent market leaders have adopted a proactive platform strategy. It has instead been attritional to support their traditional businesses.

Source:https://www.mckinsey.com/business-functions/digital-mckinsey/our-insights/five-fifty-platform-plays?cid=other-soc-twi-mip-mck-oth-1805&kui=WRrEnLPQHtax6yFuuFmpKw

Uploaded Date:10 July 2018

Osteria Francescana has now been voted as the world’s best restaurant in a noted study. But all was not rosy at the beginning. The restaurant was panned by Italians due to its constant experimentation in a culture which adheres to centuries-old norms when it comes to culinary habits. The initial success and subsequently being granted Michelin stars could have led to some sort of complacency, as is a common feature across successful new companies. But instead Osteria Francescana has constantly built on success due to it evolving at all times. Business innovation is the norm at Osteria with new practices or recipes being experimented with. Novelty is rewarded here above the mundane. This creativity also leads to an improvement in job satisfaction, further linked with increased productivity.

Source:https://hbr.org/2018/06/what-the-worlds-best-restaurant-knows-about-keeping-its-creative-edge

Uploaded Date:04 June 2018

The US steel industry at one stage not that long back seemed invincible. This was primarily driven by demand-side economics mainly from the automotive and consumer electronics businesses. Now allthree have been disrupted thanks to cheaper foreign competition. The American healthcare is one ripe for such kind of disruption as costs are spiraling high. Regulation too is excessive. That is where Narayana Health’s business innovation could prove to be the first nail in the coffin. It’s Health City in Cayman Islands (HCCI) is not far from US shores, yet outside the regulatory boundaries. Concepts of reverse innovation have been brought in from India where the founder is originally from. The average cost per bed for building HCCI stands at a third of US prices. Even FDA endorsed medicines could be purchased at lower prices thanks to relations back home in India being leveraged. Back-end operations such as HR, finance and radiology were outsourced to Indian units. Certain units were even home-produced such as medical oxygen being made inhouse. This isn’t strictly medical tourism, but being so close to home, could en up being a major disrupter.

Source:https://hbr.org/2018/06/is-this-the-hospital-that-will-finally-push-the-expensive-u-s-health-care-system-to-innovate

Uploaded Date:04 July 2018

Mergers, acquisitions and partnership agreements have become increasingly common in business. There have been many of late such as AT&T-Time Warner, CVS-Aetna, Express Scripts-Cigna and T Mobile- Sprint. This raises the specter of collaboration, yet there is a fear within the US Department of Justice (DoJ), that this could thwart the true spirit of competition, essential to a healthy business environment. Occasionally the DOJ can actually knock-down some proposed mergers when affects the customer base substantially. However, a lot of mergers take place due to other reasons and not just to kill competition. In fact, competition itself is a varied term. Five kinds have been identified, starting with horizontal competition which is naturally one where two or more compete within the same industry. Conversely, vertical is that where companies are in competition either with their suppliers upstream or buyers downstream, mainly over profit margins. Disruptive competition is one where any business innovation moves in to the market, threatening to deplete or eliminate legacy firms. State-sponsored competition is very common in China. Here, companies are backed by a central government, often for welfare purposes. Collective competition is increasing its presence but has always been around. It is when several players collaborate simply to fight an existing giant head-on. These collaborators do not have much in common except a common enemy, such as Apple is for the Android camp. Source:https://hbr.org/2018/06/how-mergers-change-the-way-your-company-competes?utm_medium=email&utm_source=newsletter_daily&utm_campaign=dailyalert_not_activesubs&referral=00563&deliveryName=DM7457

Uploaded Date:22 June 2018

There are different models for any company to grow, but six of these are most commonly identified. The first one relates to technology through new processes. Apple was very good at offering new experiences. Features cannot always be completely overhauled, but even some incremental changes can have ripple-off effects. Getting new customers is always a challenge, so newer markets need to be forever explored. A business innovation such as the iPod or the Home Pod were revolutionary and not just enhancements on existing models. Solutions need to be found for existing problems within the society. iTunes is an example of a completely new model being developed. It involves reimagining the existing ecosystem to garner innovative revenue streams. A matrix needs to be built to plan future growth. Within this, markets must be divided into current and new, while capabilities similarly need to be broken down into new and existing.

Source:https://hbr.org/2018/06/the-6-ways-to-grow-a-company?utm_medium=email&utm_source=newsletter_daily&utm_campaign=dailyalert_activesubs&utm_content=signinnudge&referral=00563&deliveryName=DM7588

Uploaded Date:22 June 2018

2017 was a year of substantial M&A (Mergers and Acquisitions) activity in the healthcare industry. A recent report brought out by business consulting giant Bain has further highlighted this in its latest report. In total, three mega-mergers took place last year. These are defined as mergers with a combined value of US$ 20 billion or more. The collective value of these three deals accounted for over a third of the entire industry’s activity. In the first of those deals, Johnson & Johnson (J&J) acquired Swiss pharmaceutical company Actelion. J&J also sold off Rectinol and Anusolto Church and Dwight. The company also sold Codman Neurosurgery to Integra Life Sciences. A common theme among the buyouts were leveraging the research and development capabilities of those acquired. Private Equity (PE) analysts meanwhile are forming an unbiased market view through business analysis involving quantifiable goals. This is helping them take more informed investment decisions. One must clearly know the objective and focus ahead towards the same. One must be transparent with those brokering the deal. Every asset must be leveraged for what it is worth.

Source:http://www.bain.com/publications/articles/global-healthcare-corporate-m-and-a-2018.aspx

Uploaded Date:22 June 2018

A lot of companies experience a gap between their lofty corporate strategy documents with the actual execution of the same. That is why a thinktank has listed out ten principles which can reduce this gap. In spite of the obvious differential, companies must for a start nonetheless aim for the stars. Brands must leverage their inherent strengths. They need to be ambidextrous to the point that they can dabble in a number of work styles. The right talent management would dictate that each person’s role within the overall strategy be well explained. The entire structure must ultimately be aligned with this overall strategy. Functional teams are just for convenience sake but must not act as silos or barriers. The aim must be to be get as digital as possible. The management team must try to keep things simple. The value chain must also be shaped accordingly. To ensure coherence, collective mastery has to be inculcated.

Source:https://www.strategyand.pwc.com/principles-strategy-through-execution

Uploaded Date:15 June 2018

Some leaders are good at agile methods so stimulate organizational transformation on those lines. This is a huge challenge for the leaders who occupy the top positions. While they were rising up the ranks, the system was completely different, so they need to engage in proactive unlearning. Not all agile behaviors may be relevant for each organization, so the leader will need to gauge the right ones. A Europe-based financial institution which recently underwent such transformation, outlined some of the traits needed. Trust and openness are the first two. Lowered ego and sense of collaboration are the next. Transparency needs to be maintained within and externally. Employees and the management need to be accountable in their actions. It is important that agile ways be dictated from the very top. The leaders need to behave as change catalysts themselves. They will need to develop talent management abilities by empowering others within their teams. New behaviors not only get accepted but are in fact celebrated.

Source:https://www.bcg.com/publications/2018/agile-starts-or-stops-at-the-top.aspx?linkId=52472651

Uploaded Date:15 June 2018

People tend to view Netflix as a digital native, whereas in truth, its present business model is simply its third avatar. Netflix started off as a DVD rental, moved on to being a platform to stream movies, and is now an entertainment industry leader through its original content. It created content suing customer insights gleaned from the enormous bits of data warehousing done over the years on people’s usage patterns. Across all these three business models Netflix has dabbled in and been successful, the common thread has been its customer-first approach. Blockbuster was Netflix’s biggest rival early on, but completely folded about eight years back. A lot of companies are cursed by their early success in a different model. This is because older, legacy-businesses tend to be asset-heavy. Over time, with reduced cash flows, a lot of these heavy assets appear like liabilities. Unlike Spotify or Airbnb which were born in the digital era, and had little hesitation in adopting a modern outlook, many of the older firms have become dinosaurs. A parallel to Netflix would be Dominos who too have leapfrogged above competitors using technology-enabled customer-centric servicing.

Source:http://www.bain.com/publications/articles/reinventing-your-business-model-for-digital.aspx

Uploaded Date:15 June 2018

Under the leadership of Stanford-educated George Kurian, data warehousing giant Net App has bounced back to post healthy returns. The company’s fortunes have been turned around by the work of the ex-Oracle man. Tough decisions have been taken along the way, the most being laying off of about 1500 employees in early 2016. Cloud storage brought massive disruption to the industry Net App is in. but that was fought using some innovative techniques. Net App is also very careful about the values recruits bring to the table, especially those recruited at senior executive levels. Kurian is himself a great fan of Abraham Lincoln whose role as a leader has profoundly impacted him.

Source:https://www.gsb.stanford.edu/insights/importance-embracing-uncertainty?utm_source=TWITTER&utm_medium=Social&utm_campaign=Insights&Date=20180427&linkId=50713227

Uploaded Date:13 June 2018

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