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The transportation and distribution network is witnessing unprecedented growth right now, but this is also fueling new forms of operational complexity. Costs can spiral out of control, unless preemptively struck now. According to a report submitted by business consulting giant Bain, leading companies are on top for a reason. Their distribution and transportation costs are less than a mere six percent of total revenue, where the typical companies clock between a six and an eight percent. While designing the network, one needs to have a clear understanding of the overall costs. An overall bird’s eye view needs to be assessed. The corporate strategy needs to focus on the long- run. Any changes to the network needs to be tracked closely, while also ensuring that there is detailed monitoring.

Source:https://www.bain.com/insights/distribution-costs-infographic/

Uploaded Date:20 May 2019

Some companies are disproportionately bigger than the industry average. This is true across industries, and geographical locations. About four- fifths of the global positive economic profit can be traced down to a mere tenth of the world’s largest companies. Business intelligence provided by McKinsey further confirms that a mere one percent of companies accounts for thirty- six percent of the said profits. While economic profits soar for some, the losses likewise too proportionately go up. Several firms are now turning in to what may be described as ‘zombie companies’. Size and productivity do matter, but capital investment often has a more direct influence. Superstar companies on average spend about two to three times more on business research and development than do the others. Intangible investments are now of top importance due to the ongoing digital disruption.

Source:https://www.mckinsey.com/featured-insights/innovation-and-growth/what-every-ceo-needs-to-know-about-superstar-companies

Uploaded Date:20 May 2019

Most organizations suffer from what is called the Seneca Effect. Under this, companies tend to decline much quicker than their pace of growth. That is where preemptive trans- formation is necessary. Among all industries, the greatest effect of such preemptive transformation has taken place in materials, followed by consumer discretionary and consumer staples. The last effect has been at financial services followed at a distance by health care. This is as per a study by management consulting giant BCG. There are some secondary benefits as well of this style of transformation, much more effective than its reactive variant. Such companies tend to have a long- term clearer outlook towards the corporate strategy. To ensure this style is successful, companies must constantly explore for opportunities. A sense of urgency has to be brought in, while watching out for the early- signals of change. Transformational capabilities too need to be created. This will help control the narrative and select the right approaches for the desired change.

Source:https://www.bcg.com/publications/2018/preemptive-transformation-fix-it-before-it-breaks.aspx

Uploaded Date:16 May 2019

There are certain markers that define superstar sectors, cities and firms in the global economy. Any analysis on the economic profit of firms can be extended to sectors and cities where the economic activity is taking place in. Firms move along in a power curve. Sectors also do not move in any uniform pattern, but continuously evolve. Cities have their own sources to derive power from. As per business intelligence supplied by the McKinsey Global Institute (MGI), fifty most power cities have been identified in terms of economic footprint. Atlanta, Boston, Seattle, Houston, Dallas, Chicago and five more are the leading lights of North America. In India, it is Mumbai and New Delhi. In Europe, Amsterdam, Brussels, London, Madrid, Milan and Paris make up among the nine of the most prominent ones. Questions are finally posed to gauge further business research and the implications these lead to.

Source:https://www.mckinsey.com/featured-insights/innovation-and-growth/superstars-the-dynamics-of-firms-sectors-and-cities-leading-the-global-economy

Uploaded Date:15 May 2019

There is much frustration to be handled by academicians during the corporate strategy classes at business schools. This is because there is a perception difference between what is taught and what students feel would lead them to solve strategic problems. While they do absorb the tools mandatory during the classes, the general feeling is that it is often a moment of intuitive spark that’ll provide the innovation needed to succeed at the strategy level. The traditional tools still do have a place, as they can be used to gauge contrast. To begin one needs to identify the assumptions that underlie conventional thinking at the organization. One needs to then assess which of these could be tweaked to lead to maximum gain. The strategist needs to disturb certain parts of the process to beak up the ingrained assumptions. Traditionally disparate products and services can then be married together. Liabilities or limitations may then be turned into opportunities. Far- flung industries can then even solve pressing concerns. Design solutions are increasingly being tapped into as evidenced by the case of IDEO moving into business consulting.

Source:https://hbr.org/2019/03/strategy-needs-creativity

Uploaded Date:15 May 2019

The idea of corporate strategy is usually wrongly understood by people. Employees during their growth phase are so fascinated by this term, they assume it is about setting team goals, and about creating broad frameworks. They also assume that strategy is about writing long documents and motivating others. Drawing graphs on a whiteboard is just one of those means to achieve this. However, as one grows one understands that this is just a stereotype on what work really constitutes. Instead, strategy is about engaging with high- level business and product decisions. Strategy involves three steps. The first is to streamline all company activities towards the final goal of success. One needs to understand the kind of problems being dealt with, and which one deals with which stakeholder group. Finally one needs to prioritize the most important tasks, and execute them with pace.

Source:https://sloanreview.mit.edu/article/how-to-become-a-strategic-leader/

Uploaded Date:13 May 2019

Global brands are market leaders for a reason. They can manage multiple markets across the globe simultaneously. One such is the consumer- packaged goods industry, worth more than a trillion dollars globally. Its key players are Colgate, Olay, Avon and Axe. Among the emerging markets, the most important ones for them have been India, China and Indonesia, followed by Brazil. But this upward trajectory is now getting challenged by several fleet- footed local players. As per marketing research collated by Accenture, the top brands have lost more than five percent in market share in these countries. One way to bridge this falling market share is to include local brands in the product mix to increase acceptability. Another is to adjust the expectations about brand lifecycles. Beyond the marketing alone, it is the ideas and business innovations that must now hold central ground.

Source:https://hbr.org/2019/02/how-global-brands-can-respond-to-local-competitors?utm_campaign=hbr&utm_source=twitter&utm_medium=social

Uploaded Date:11 May 2019

 

A number of companies suffer from the onslaught of excessively well- drafted language that fails to tick the reality boxes. Boards draft the perfect corporate strategy document, but the execution fails. Instead o using the excess jargon, team leaders must instead focus on empowering their team members. This is a very good ploy towards the right talent management, as the employees feel motivated, so the resources may be rightly allocated. This flexibility lets the people seize the opportunities that present themselves. American Airlines for instance has suffered form this use of jargon, as opposed to Southwest Airlines, which gives crisp, clear and unambiguous communication to all stakeholders. The objectives need to be limited to a few only. Midterm results can’t be ignored. Focus has to be on the future. The hard decisions need to be made periodically. The critical vulnerabilities present need to be worked on. The right guidance has to be provided when needed. The top management needs to be in sync with how the execution is actually taking place.

Source:https://mitsloan.mit.edu/ideas-made-to-matter/how-to-turn-a-strategic-vision-reality

Uploaded Date:27/03/2019

Populist strategist inevitably fail. This is because trends that work in some places, especially the big- ticket companies, tend to be widely adopted by all. Little due diligence seems to be conducted while adopting these fancy terms. Instead of blindly jumping on to these terms, boards must adopt their corporate strategy while framing their organization’s condition against a set of relevant questions. One of them is about the line of business or more that the company find itself in, or should it change. The next is, how value could be added to the same. The target customers then need to be etched out. The right value propositions need to be identified to approach to this customer base. Finally, the board must clarify what capabilities does the company have to execute the value propositions claimed.

Source:https://www.strategy-business.com/article/Why-Popular-Strategies-Always-Fade?gko=8e3c9

Uploaded Date: 27/03/2019

A book written by the former CMO of P&G, titled Grow postulated on the significance of purpose. The book argued, that the right focus towards purpose leads to enhanced economic success. To start with, talent management and retention, needs to be top priority as it leads to increased engagement, and thus productivity at work. Similar focus has to be made towards retaining the existing customers, and to attract newer ones. Once all this falls into place, naturally the focus has to be on increasing shareholder returns. In order to find such purpose, the right balance needs to be found between three pulls. Those are towards personal desire, business direction and the customer dreams. To gauge whether one is on the right track towards finding the said purpose, one can follow the RATE formula. It expands to Radical Agile Transformation Exercise.

Source:https://www.innovationexcellence.com/blog/2019/03/02/from-why-to-what-to-how-whats-your-purpose/

Uploaded Date:27/03/2019

Companies need to reinvent their business models to remain relevant in the consumers’ minds. They mustn’t cling to past held ideals, that may not be of great relevance now. A key example of this is IKEA, which on paper is a furniture retailer, but actually is a lot more. They bring added convenience to consumers’ lives. Three more companies can be listed that succeeded in their efforts at the art of inversion. One is Amazon, another is Instant Pot, while the third one is Nestle. One, that got away and could not do so is Ford Motor Company. The company launched a business innovation titled Chariot, which was a van shuttle service. Thankfully for Ford, the company realized soon enough that this was going to be a cropper, so the idea got replaced by Spin, which allows transportation via scooters.

Source:https://mitsloan.mit.edu/ideas-made-to-matter/what-ikea-and-instant-pot-can-teach-us-about-competition?utm_source=mitsloantwitter&utm_medium=social&utm_campaign=instantpot

Uploaded Date: 26/03/2019

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