Competitive strategy for business growth: Process, practice and performancePosted on: March 13, 2013
A recent Open University Business School (OUBS) webinar provided a summary of a January strategy summit. The panel included Peter Wainwright, Professor Thomas Lawton, Jo Salter and Antoine Boatwright (Dell) and included numerous case study video clips.
The strategy for positioning for business growth framework comprises three elements:
- Innovation (product and promise)
- Internationalise (product and people)
- Integrate (market and non-market)
Tripadviser – Innovation was introduced to its proposition by embracing user generated content (UGC) and “frenemies” who might be competitors, suppliers or customers. It is driven by outrageous ambition (driven by BHAG – Big Hairy Ambitious Goal from Jim Collins). They mentioned that SEO was the key reason for success – they don’t pay for advertising but have 1,000 software engineers. Other core values include: “speed wins” and “try things and don’t think about being crappy”.
Ryannair – Adapted the South West Airlines model for the European market and then asked “Are we where we should be?” and further adapted the structure and management to succeed.
Capita – From a situation where it had 3,000 seats in telephone contact centres, it had to find way to make money in a new world where social media and the web changed the market. Its innovation and integration stemmed from the recognition that it listened to 150m customer interactions a year and had a significant asset in its knowledge and analytics.
Dell – Recognition that over the past 20 years working globally has evolved with broadband as an enabler and the dominance of the West has been challenged. On integration, they changed their metrics from tight central control of revenue and margins to free up the regions to decide how to operate based on broad strategic directions – this encouraged more long term, strategic thinking. There were also some insights into the importance in cross-cultural management and communication by focusing on the individual in terms of one-to-one conversations, things like etiquette, taking a genuine interest and translating the value proposition into meaningful guidance for all levels of employees.
There was a lot of discussion about alignment – particularly between the business strategy and policy (tactics, rules), market and non-market (e.g. political, social and cultural space, regulatory issues, communities and Government) as well as the company and its supply/value chain.
There were felt to be four criteria for success:
- Market leading growth and ambition – be clear about approach and stretch
- Strong situational awareness – behaviour driven by creating shareholder value
- Strategies have to be adaptive – direction of travel rather than the destination important
- Align the board room and the front line – Big goals don’t work, decide what you want to be famous for
There was also a good example of how the pharmaceutical development model was adapted for the record business to sign artists.
Throughout the session there were polls to assess the reactions of the 150 participants, for example:
- Focus – 33% concerned with improving the quality of strategy, 30% with delivering strategy to the front line
- Criteria for success – 32% better alignment, 22% improved situational awareness, 15% adaptive strategy
Perhaps not surprisingly, strategy implementation emerged as the biggest issue with the need to embed the strategy into the DNA of the organisation – its people.