Tuesday, May 27, 2014

The Go-to-Market Revolution
Igniting Growth with Marketing, Sales, and Pricing
 Rich Hutchinson

Quite interesting

Over the long term, revenue growth powers 75 percent of total shareholder return (TSR) for the upper-quartile value creators of the S&P 500. Even in the short term, growth accounts for nearly a third of TSR for these outperformers—double the boost from improving margins or cash flow. A growing business also empowers employees, attracts top talent, and helps fund expansion, transformation, and more growth. 
These leading companies are taking advantage of what The Boston Consulting Group calls the “Go-to-Market Revolution.” 

Three tides of deep-rooted change are driving the revolution. The first is the dramatic shift, in almost every industry, of what BCG calls customer pathways—the ways customers learn and communicate about products and services on the path toward a purchase. Second, technology and advanced analytics are providing new tools for sales and pricing teams, marketers, and researchers. Third and finally, companies now navigate a globalizing world that requires most of them to compete in new markets, often against unfamiliar rivals.

Customer PathwaysThe first tide is the rapid recent evolution of what BCG calls customer pathways. The ways consumers learn about and buy products have shifted dramatically and quickly, triggered by changes in technology, communications, and media.

Advanced Data and AnalyticsThe second driver of change could be called the go-to-market arsenal. It is the rapid and transformative evolution of “smart” data, advanced analytics and modeling, and other tools capable of increasingly sophisticated approaches in segmenting and analyzing information and reaching customers

Global and Emerging MarketsThe final driver of the Go-to-Market Revolution is globalization, which creates two fundamental commercial challenges.First, globalization has changed the competitive landscape in every market. The rise of globalization has opened labor markets and expanded offshore production, resulting in lower product costs in developed countries even as it destabilized brands and prices….Second, globalization in emerging economies has been accompanied by rapidly expanding wealth

Thursday, May 22, 2014

Ambidexterity: The Art of Thriving in Complex Environments

by Martin Reeves, Knut Haanæs, James Hollingsworth, and Filippo L. Scognamiglio Pasini

This is one of the most important aspects of the MDG framework and an area we spend considerable time on in our Kellogg class. My goal is to entice you to view the entire article

Managers today face an apparent contradiction. On one hand, austerity in the developed world and intense competition push them to cut costs and drive efficiency. On the other, the increasing pace of change means they need to emphasize innovation. 
Resolving this contradiction requires ambidexterity—the ability to both explore new avenues and exploit existing ones. Companies need ambidexterity when operating in diverse environments that require different styles of strategy simultaneously, or in dynamic environments that require them to transition between styles over time. 
Companies need to be ambidextrous when operating in both emerging and developed markets, when bringing new products and technologies to market while exploiting existing ones, when integrating startups into their existing business, and in a range of other circumstances. 
The need to develop ambidexterity is widely acknowledged: in a recent BCG survey of 130 senior executives of major public and private companies, fully 90 percent agreed that being able to manage multiple strategy styles and transition between them was an important capability to develop. But this aspiration is hard to realize. Exploration and exploitation require different ways of organizing and managing…. 
…..3M, a company renowned for its culture of innovation, experienced the exploration-exploitation tradeoff in the early 2000s, when it introduced Six Sigma practices in an effort to boost productivity. While the company’s productivity did indeed increase, the same practices reduced 3M’s ability to innovate, as evidenced by a fall in the proportion of revenues from new products.

Picking the Right Approach to Ambidexterity (see the article for details

Monday, May 19, 2014

Becoming a Capable Company
Cesare Mainardi is the CEO of Strategy&

Very interesting insight…

"There’s always been a tension between two realities of business management today. On one hand, advantage is transient. On the other, corporate identity is slow to change. The capabilities that make companies truly great are slow to develop and can’t be built overnight. If they could, they wouldn't be worth very much because anyone could copy them.
Rita Gunther McGrath, associate professor of management at Columbia Business School, has documented that the factors that used to bring automatic success to companies over time—like scale or market position—are increasingly unreliable. And it’s getting worse with technological disruption, globalization, and regulatory shifts.
How do we resolve this tension? What should companies do?
Five things in particular stood out that made these companies capable and successful: 
1. These companies stay true to who they are….. They commit to an identity and play the strategy long game
2. They get out in front and shape what their customers want…..These companies don’t do that. They anticipate customer desires and create demand.
3. They translate their strategic intent into the everyday…..They build the capabilities that matter most and execute relentlessly and flawlessly.
4. They put their culture to work……These enterprises celebrate what is already great about their culture, leveraging their existing behaviors to make themselves more powerful and effective
5. Finally, they cut costs to grow stronger….They treat expenses as investments, doubling down on the capabilities that matter most in terms of bringing value to the market."