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Corporate Strategy

Amazon’s Prime Day first began in the year 2015, but has now become one of the showpiece days for the retail industry, about par with Black Friday and Cyber Monday. For Amazon alone, this is in fact a bigger day. The most recent one, brought in the highest traction till date, and has also brought in several learning for all. For one, there were more customers brought into Amazon’s fold this year, than ever before, as per business intelligence supplied by McKinsey. Echo and Kindle were the big winners among products. A number of Amazon’s private labels picked up business this year. Prime example among them include Pinzon, Good threads and Amazon Essentials. The Whole Foods Market (WFM) experienced a slight slump this year. Amazon’s partners such as Bose, San Disk and Dyson took full advantage to leverage the trend. Surprisingly, taking advantage of the overall trend, were also Amazon’s big rivals such as Costco, Target, Lowe’s and Best Buy. Brands need a specific digital marketing strategy to take full advantage of the Amazon Prime Day. Other retailers too must plump in. Amazon itself will only scale up, fully utilizing its traditional flywheel concept.

Source:https://www.mckinsey.com/industries/retail/our-insights/amazon-prime-day-what-the-real-lessons-are

Uploaded Date:20 July 2019

Consumer Packaged Goods (CPG) companies will increasingly come under the pressure to align their entire operations to provide an Omni- channel experience. Retailers in turn, will also prefer such firms. Thanks to the emergence of online retailers such as Amazon or Zalando, the erstwhile grip on the market that the CPG giants possesses, has diminished. To curate such an experience, CPG players need to ensure cross- functional collaboration. The corporate strategy likewise needs to have an Omni- channel philosophy. There are additional complications that have now arisen at the supply- chain network as well. This supply- chain needs to go through a proper segmentation. Disruptive technology also needs to be brought in to the game. Adequate optimization is needed for the internal lead- time. Finally, an overarching transition plan has to be put in place. This has to be include the smaller component pieces too. There must be an adequate provision for testing.

Source:https://www.mckinsey.com/industries/consumer-packaged-goods/our-insights/building-omnichannel-excellence

Uploaded Date:20 July 2019

Companies worldwide, across sectors are struggling hard to modernize their technology. This is needed urgently now as technology is no longer merely an aid to business, but an actual driver. For this, some steps have been documented, which when followed help in the process. The first principle has to be to put the customer at the centre of all decision making. The company architecture needs to be simplified, as this will help amplifying the technology to all parts of the physical space. The entire design has to be geared towards speed and flexibility in execution. The right talent management practices need to be brought in so that a proper company culture gets curated, and there is proactive workforce engagement. An overall services mindset has to be adopted. The journey has to be plotted right at the beginning at the time when the corporate strategy is drafted in. The hierarchy must be design to leverage the existing in- house capabilities. Universally, agile and user- friendly tactics need to be applied. Any investment in resources has to be planned for the long run, so that these transformations stick on. Business partners too have to be identified based on trust and shared values.

Source:https://www.strategy-business.com/article/10-Principles-for-Modernizing-Your-Companys-Technology?gko=6ff05

Uploaded Date:03 July 2019

A new model has been developed by PwC, known as the flywheel. It has the power to transform the thinking behind the corporate strategy. Growth is what the entire flywheel has to aim at. For that it has to take in to account the inbound traffic, the sellers, selection methods and the final customer experience. More drivers need to be added, as demand increases. Some companies have been known to be resilient. Netflix is one such company, due to its strong corporate culture, is able to use the flywheel to its greatest advantage by transforming the strategic thinking. Among startups, Peloton, which is for fitness, has fared amongst the best. Advanced strategy tools are used by all the adherents of the flywheel model.

Source:https://www.smartbrief.com/s/2019/06/how-flywheel-model-can-transform-strategic-thinking

Uploaded Date:03 July 2019

The corporate strategy at any company needs to function within the right strategic imperatives. There are five broad approaches to this strategy as understood. The first is the classical, which has clear phases for planning, analysis and for execution. The next is adaptive. This one focuses on a continuous experimentation, and scaling up when the time comes right. A third is the visionary style, ideal for the fostering of any business innovation. Game changing products, business models or services get the launch required under such strategic leadership. The fourth is where existing platforms and ecosystems are leveraged to the hilt. The leaders shape the views towards a collaborative environment. The one most common now is the renewal style. This late entrant is ideal for now, due to the constant reiterations possible under this model. Radical moves can be plotted in it, even while operating under scarce resources.

Source:https://www.bcg.com/en-in/publications/2018/your-strategy-process-needs-a-strategy.aspx

Uploaded Date:27 June 2019

Not that long back, market leaders in various industries, could be sure of continuing on their perch for a substantial duration of time. This has been eroded now thanks to the rapid influx of new technologies. The TSR or Total Shareholder Return need not remain constant now. The business environment is now so much more dynamic. Reinvention has now become that much harder. To win over the next decade, companies will need to perfect their choice of metrics. The traditional means to measure business success need not hold true any more. Companies need to analyze a few fact that will help frame their future policies. A pipeline needs to be created for possible future business models that have a high growth potential. The corporate strategy too needs to balance out the long term exploration with the near- term profitability. A culture needs to be curated at the organization so that cognitive diversity may thrive. This will also set in motion a competition for ideas. One’s incumbent beliefs and approaches too need challenging at times.

Source:https://www.bcg.com/publications/2018/global-landscape-of-corporate-vitality.aspx

Uploaded Date:27 June 2019

In the globalized market place of business today, some local dynamos are stealing a thunder, thus remaining ahead of the curve. The prolific use of digital tools is helping them take on their otherwise much better funded MNC rivals. Local dynamos exhibit several key characteristics, such as their ability to harness new technology proactively. They often end up developing digital- first business models. Due to their inherent understanding of the local conditions, they are able to meet customer expectations, much quicker, with improved quality margins. Talent recruitment and retention have a very important position for these local dynamos. They are also highly proactive in curating the larger digital ecosystem, that will boost their capabilities and reach. The local dynamos are also quick in moving from their traditional products to a slew of services presently needed in the market. Among the powerful trends driving these local dynamos, is the fast urbanization and the rise of the consumer class in the emerging economies. The likes of India and China are heading this new economic trend followed by Africa and Southeast Asia. The local population in many of these countries is increasingly displaying a digital- first aptitude, with smart phones having empowered millions of consumers.

Source:https://www.bcg.com/en-in/publications/2018/local-dynamos-emerging-market-companies-up-their-game.aspx

Uploaded Date:27 June 2019

Venture capital has now seen a different trend flourishing. It is the act of large corporations, making equity investments on startups. This is known as Corporate Venture Capital (CVC). In 2018 alone, this market increased by thirty- five percent. The number of deals increased by 32 percent and the share of investment rose by nearly half at forty seven percent, as per business intelligence provided by the research wing of the MIT Sloan. Among the corporations that have invested in these CVCs include the likes of Unilever, Novartis, Robert Bosch, Airbus, Mitsubishi and Johnson & Johnson. Unfortunately, in spite of a lot of positivity at the start of each such investment, a number of these falter after some time. There are several reasons for the long- run failures. One is the lack of balance between the traditional venture capital and this new trend. A lot of the risks are caused due to a “stuck in the middle” syndrome.

Source:https://sloanreview.mit.edu/article/making-corporate-venture-capital-work/

Uploaded Date:26 June 2019

Across studies made with companies, that are facing the heat of disruption, the reasons cited by the employees and leadership remain the same. They either blame it on some new technology, or attribute it to some upstart new company, taking away business. But in reality, what has emerged, is that unhappy customers are always the primary reason. This faulty thinking often leads to legacy companies, merely copying another’s technology, or replicate their business model. Yahoo’s travails in the search engine segment against Google and later Microsoft as well, is one good example of this. Several other incumbents across industries have ceded group to disruptors. Examples of those losing out includes the likes of Electronic Arts, Four Seasons, Best Buy, Sephora, Comcast and Gillette to the business innovations of Twitch, Airbnb, Amazon, Birch box, Netflix and the Dollar Shave Club respectively. Alibaba long understood this cycle, so it mastered the art of customer side focus.

Source:https://hbr.org/2019/06/disruption-starts-with-unhappy-customers-not-technology?utm_campaign=hbr&utm_medium=social&utm_source=twitter

Uploaded Date:26 June 2019

The benefits of agile management techniques are now well appreciated. There is a substantial reduction is costs by up to a fourth or even a third, as per a study conducted by business consulting giant BCG. There is also an improvement in quality, by a factor of up to a fifth. The same study also confirms that the delivery of new services and products doubles or even triples. To ensure this happens, commitment is needed right from the top. CEOs must begin each transformative journey by questioning the need to go agile. The principles and practices need to be adopted after due diligence is conducted. The leadership too needs a periodic change. The entire team across the levels, must feel a sense of empowerment. One needs to learn quick. And adapt at pace too.

Source:https://www.bcg.com/featured-insights/how-to/agile.aspx

Uploaded Date:24 June 2019

The truck makers in Europe are trying out innovative ideas to break out of the so- far set pattern. A high interest is being shown towards electric and hybrid vehicles. Interestingly, for most Europe- based truck makers, it is the total cost of ownership that seems to matter most to them, while making their purchase decisions. As per a report by management consulting giant Bain, this aspect far overpowers others factors, such as the truck performance, its features, service quality, truck image, or dealer relationship. Many European truck brands are struggling to differentiate themselves, due to the threshold of quality now achieved by most. The key touch points of the sales process, need to be identified by the dealers and manufacturers to help the buyers make informed decisions. Over a period of time, these truck makers will need to develop unique business models, to meet customer demands for alternative options.

Source:https://www.bain.com/insights/how-europes-truck-makers-can-break-out-pack/

Uploaded Date:22 June 2019

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