Winning Strategies of Market Driving Organization L1(2)

8/4/2019 Winning Strategies of Market Driving Organization L1(2)

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Winning strategies of Marketdriven organizations

July 09, 18 2010 (A)

July 11, 19(B)


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Visionary Firms

Drivers of market

Leaders of Tomorrow


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Market Driving firms

Market drivers see the world differently and

focus on latent or emerging customer needs.

Market drivers create new markets or

redefine the category in a fundamental way

that competitors are rendered obsolete.


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Market drivers attributes

1. They trigger industry breakpoints or what Andy

Grove of Intels strategic inflexion points,

which change business innovation.2. Core Values inspire their radical business

concept.

3. Rather than learn from existing customers, they

often teach potential customers to consume their

drastically different value proposition.


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values driven organizations


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VALUES DRIVEN CHANGE

OR

CIRCUMSTANCES DRIVEN VALUES


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Getbettervs

Getdifferent


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A JOURNEY

THROUGH WHAT IS

FUNDAMENTAL

AND WHAT IS

CHANGEABLE


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NOTHING SPLENDID HAS

EVER BEEN ACHIEVED

EXCEPT THOSE WHO DARED

BELIEVED THAT SOMETHING

INSIDE THEM WAS SUPERIORTO CIRCUMSTANCE

BRUCE BARTON


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Today We Are In

A Brawl With NoRules!


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HORSE RACE of TOMORROW

All rules subject to change without noticeThe prize money may change at short notice

The route and the finish line will likely change after the race

starts

Bets may be made at any time during the race

New entrants may join the race at any time

Racers are on line at all the times and may alter their plans based

on the most current information

Racers may form alliances

All creative strategies that are not specifically against the law areallowed

Government laws may change at any time (retrospectively)


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Confusion

And more confusion .


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Forbes100 from 1917 to 1987 [70 years]

* 39 members of the Class of 1917 were alive in

1987

* 20 of the firms were in list of 100 in 1987* 18 F100 survivors underperformedthe

market by 20%

* Just 2 (2%) GE & Kodak, outperformed the

market 1917 to 1987.

Source: Dick Foster & Sarah Kaplan, Creative Destruction: Why Companies That

Are Built to Last Underperform the Market


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20 of 267 of top 10*


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*P&G:

Declining domestic sales in 20of 26 categories;

7 of them belonged to the top

10 categories:

The billion-dollar problem.Source:Advertising Age 01.21.2002ecurities


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They had the unpleasant job ofannouncing the second straightquarter of losses in theirbusiness empire that had nevermade a loss before.

Mr. Steel's Moment of Truth, Forbes India, June 5, 2009

2009 .


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GM files for bankruptcy

Ford Motor seeks togain amid Rivals pain

Economic Times, June 1, 2009


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There will be more

confusion in thebusiness world in the next

decadethan in any decade in history.

And the current pace of change willonly accelerate.

Steve Case[America online]


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Uncertainty: We dont know

when things will get back tonormal.

Ambiguity:We no longer

know what normal

means.


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Security in

an insecureworld(existence)?


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The greatest danger

for most of us

is not that our aim is

too high

and we miss it,

but that it is

too low

and we reach it.

MichelangeloItalian Renaissance painter


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Beware of the

tyranny of makingSmallChanges toSmall

Things. Rather,makeBig

Changes toBigThings

Roger Enrico, former Chairman, PepsiCo


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Forget > Learn

The problem is never how to get new,

innovative thoughts into your mind,

but how to get the old ones out.

Tom Peters


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Our ideal acquisition is a small startup

that has a great technology product on thedrawing board that is going to come out in

six to twelve months.

We buy the engineers and the

next generation product.

John Chambers, Cisco


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These days, you cant succeed as a

company if youre consumer led because in a world so full of so much

constant change, consumers cant

anticipate the next big thing.

Companies should be idea-led and

consumer-informed.

Doug Atkin, partner, Merkley Newman Harty


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http://en.wikipedia.org/wiki/File:Henry_ford_1919.jpg


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http://images.google.co.in/imgres?imgurl=http://oldcarandtruckpictures.com/ModelTFord/1914_Ford_Model_T_Touring_Car_Black.jpg&imgrefurl=http://oldcarandtruckpictures.com/ModelTFord/&usg=__YUdr_4jO-sqSaH7CZc59qCx7HG8=&h=300&w=400&sz=24&hl=en&start=5&sig2=ZlhnSAMl8ODofmhqDLpdgw&um=1&tbnid=dnp076xAcNHfBM:&tbnh=93&tbnw=124&prev=/images%3Fq%3DFord%2Bblack%2Bcar%26hl%3Den%26rlz%3D1T4RNWN_enIN299IN300%26sa%3DG%26um%3D1&ei=FhQkSuSyOZeNkAX71vyHBQhttp://images.google.co.in/imgres?imgurl=http://oldcarandtruckpictures.com/ModelTFord/1914_Ford_Model_T_Touring_Car_Black.jpg&imgrefurl=http://oldcarandtruckpictures.com/ModelTFord/&usg=__YUdr_4jO-sqSaH7CZc59qCx7HG8=&h=300&w=400&sz=24&hl=en&start=5&sig2=ZlhnSAMl8ODofmhqDLpdgw&um=1&tbnid=dnp076xAcNHfBM:&tbnh=93&tbnw=124&prev=/images%3Fq%3DFord%2Bblack%2Bcar%26hl%3Den%26rlz%3D1T4RNWN_enIN299IN300%26sa%3DG%26um%3D1&ei=FhQkSuSyOZeNkAX71vyHBQ


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If Id listened tocustomers,

Id have given them

a faster horse.Henry Ford

1896 Ford Quadricycle
http://images.google.co.in/imgres?imgurl=http://oldcarandtruckpictures.com/ModelTFord/1914_Ford_Model_T_Touring_Car_Black.jpg&imgrefurl=http://oldcarandtruckpictures.com/ModelTFord/&usg=__YUdr_4jO-sqSaH7CZc59qCx7HG8=&h=300&w=400&sz=24&hl=en&start=5&sig2=ZlhnSAMl8ODofmhqDLpdgw&um=1&tbnid=dnp076xAcNHfBM:&tbnh=93&tbnw=124&prev=/images%3Fq%3DFord%2Bblack%2Bcar%26hl%3Den%26rlz%3D1T4RNWN_enIN299IN300%26sa%3DG%26um%3D1&ei=FhQkSuSyOZeNkAX71vyHBQhttp://images.google.co.in/imgres?imgurl=http://www.pattern-maker.co.uk/images/jp%2520running%2520horse.JPG&imgrefurl=http://www.pattern-maker.co.uk/Artist%2520Artwork%2520-%2520Computer%2520Generated%2520Cross%2520Stitch%2520-%2520Julie%2520Popowicz.html&usg=__5Q1d0OOJnPMFB-30ffM2mPTlsOo=&h=264&w=402&sz=21&hl=en&start=13&sig2=eNV62qnejhubIHveBg_PDQ&um=1&tbnid=DE_85gtbwNE6IM:&tbnh=81&tbnw=124&prev=/images%3Fq%3Drunning%2Bhorse%26ndsp%3D20%26hl%3Den%26rlz%3D1T4RNWN_enIN299IN300%26sa%3DX%26um%3D1&ei=jRMkSsI4j4-QBYu_wJ0Fhttp://en.wikipedia.org/wiki/File:Henry_ford_1919.jpghttp://en.wikipedia.org/wiki/File:1896-ford-archives.jpg


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Our strategies must be tied to leadingedge customers on the attack. If we

focus on the defensive customers, we

will also become defensive.

John Roth, CEO, Nortel


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Saviors-in-Waiting

Disgruntled Customers

Upstart CompetitorsRogue Employees

Fringe SuppliersWayne Burkan, Wide Angle Vision
http://www.amazon.com/gp/reader/1401303706/ref=sib_dp_pt


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The Dream ManagerMatthew Kelly

An organization can only become the-best-version-of-itself to theextent that the people who drive that organization are striving to

become better-versions-of-themselves. A companys purpose is to

become the-best-version-of-itself. The question is:What is anemployeespurpose? Most would say, to helpthe company achieve its purposebut theywould be wrong. That is certainly part of theemployees role, but an employeesprimary

purpose is to become the-best-version-of-himself orherself. When a company forgets that it existsto serve customers, it quickly goes out of business.Our

employees are our first customers, and our mostimportant customers.
http://www.amazon.com/gp/reader/1401303706/ref=sib_dp_pt


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Business has to givepeople enriching,rewarding lives,or it's simply not

worth doing.Richard Branson


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We are aLife Success

Company.Dave Liniger, founder, RE/MAX[Real Estate]


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The role of the Director is to create a

space where the actors and actresses

canbecome more thantheyve ever beenbefore, more than

theyve dreamed ofbeing. Robert Altman, Oscar acceptance speech


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Organizing Genius/ Warren Bennis

and Patricia Ward Biederman

Groups become great only when everyone in

them, leaders and members alike,is free todo his or her absolute best.

The best thing a leader can do for a Great

Group is toallow its members todiscover their greatness.


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free to do his or herabsolute best

allow its members to

discover their

greatness.

Tom Peters, May 28, 2009


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You have totreat youremployees likecustomers.Herb Kelleher, complete

answer, upon being asked his secrets to success

Source: Joe Nocera, NYT, Parting Words of an Airline Pioneer, on the occasion of Herb Kellehers

retirement after 37 years at Southwest Airlines (SWAs pilots union took out a full-page ad in USA Today

thanking HK for all he had done; across the

way in Dallas American Airlines pilots were picketing the Annual Meeting)


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Getbettervs

Getdifferent


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SUCCESSFUL HABITS OF

VISIONARY FIRMS

COMPANIES HAVE THEIR CORE

VALUES AND CORE PURPOSES FIXED

WHILE THEIR BUSINESS STRATEGIES

AND PRACTICES ENDLESSLY ADAPT

TO CHANGING WORLD


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VISIONARY FIRMS

UNDERSTAND THE DIFFERENCE

BETWEEN WHAT SHOULD NEVER

CHANGE AND WHAT SHOULD BE OPEN

FOR CHANGE

WHAT IS VISION?

Mission?


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VISION AND MISSION

VISION: WHAT YOU WOULD LIKE TO BEKNOWN FOR?

MISSION:WHAT BUSINESS YOU WOULD LIKETO BE IN?

Mission Statement components:


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Mission Statement components:

Customer/Marketing

Product or Service

Geographic Domain

Technology

Concern For Survival

Company Philosophy

Self (Business) Concept

Public Image


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VISIONARY FIRMS

Collins &Porras, 1996


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44


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Built to Last

Criteria for a Visionary Company Premier institution in its industry

Widely admired by knowledgeable business

Made an indelible imprint on the world

Had multiple generations of chief executives

Been through multiple product life cycles

Founded before 1950

It is morethan successful, morethan enduring

Displays resiliency and ability to bounce back fromsetbacks and mistakes


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Selection Process

Surveyed 700 CEOs at leadingcorporations from a cross section of

industry, size, location and type/ownership

Identified distinguishing essentialdifferences (rather than commonalities)

with a similar Comparison Company

Examined how they started and evolved

(responded to historical circumstances)

Research Results and Comparison Companies


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Research Results and Comparison Companies

Visionary Companies

1. 3M

2. American Express3. Boeing

4. Citicorp

5. Ford

6. General Electric

7. Hewlitt-Packard

8. IBM

9. Johnson & Johnson

10. Marriott

11. Merck

12. Motorola

13. Nordstrom14. Philip Morris

15. Procter & Gamble

16. Sony

17. Wal-Mart

18. Walt Disney

Comparison Companies

1. Norton

2. Wells Fargo3. McDonnell Douglas

4. Chase Manhattan

5. GM

6. Westinghouse

7. Texas Instruments

8. Burroughs

9. Bristol-Myers Squibb

10. Howard Johnson

11. Pfizer

12. Zenith

13. Melville14. RJR Nabisco

15. Colgate

16. Kenwood

17. Ames

18. Columbia


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List of Visionary & comparison companies


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Visionary Company

Premier Institution

Widely Admired

Indelible imprint on the world

50+ year track record

Multiple generations of CEOs

Multiple product/service cycles

Vi i


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Vision

Vision

Coreideology

Envisionedfuture


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Core Ideology

Core values Core Purpose

Essential, enduring

Tenets (beliefs)

What isimportant?

Reason for being

What theorganisation

offers to society

Dominant aspiration


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YOU DISCOVER COREIDEOLOGY BY LOOKING

INSIDE.

IT HAS TO BE AUTHENTIC.

YOU CANT FAKE IT


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What are Core Values?

A set of beliefs that influence the way

people and groups behave

They are the soul of the organization Effective values are deep rooted


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Johnson &Johnson Core

Values and Purposel The company exists to alleviate pain and diseasel We have a hierarchy of responsibilities: customers first,

employees second, society at large third, and shareholdersfourth

l Individual opportunity and reward based on meritl Decentralization = Creativity = Productivity


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Where do Core Values Come

From? Most core values come from the founders of

an organization

Some organizations have used a groupconsensus process to develop core values


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Why are Core Values Important?

Influence behavior

Communicate what we really believe

Core values are sacred, they do not change They provide a moral compass

Provide continuity through change

Help people make tough decisions They help to decentralize decision making

Help people to be more proactive


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National interestThe Tata group is

committed to benefit the

economic development ofthe countries in which it

operates. No Tata

company shall undertake

any project or activity to

the detriment of the wider

interests of thecommunities in which it

operates.


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Tata Code of Conduct

Gifts and donations

A Tata company and its employees shall neither receive nor offer ormake, directly or indirectly, any illegal payments, remuneration, gifts,

donations or comparable benefits that are intended, or perceived, toobtain uncompetitive favours for the conduct of its business. Thecompany shall cooperate with governmental authorities in efforts toeliminate all forms of bribery, fraud and corruption.

However, a Tata company and its employees may, with full disclosure,accept and offer nominal gifts, provided such gifts are customarilygiven and / or are of a commemorative nature. Each company shallhave a policy to clarify its rules and regulations on gifts andentertainment, to be used for the guidance of its employees.


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Integration of Core Values

Effective core values are integrated into all

levels and functions of the organization

Practicing the core values in all areas, all the

time creates integrity


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Norstan Inc. Integration of Core

ValuesEmployees Customers Stakeholders Owners

1. Be Ethical

2. Be Responsive

3. Be Profitable


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Characteristics of Effective Core

Values Clear and succinct

Usually no more than 6

Thought about and iterated a lot

They stay the same through time, they are sacred

Widely and frequently communicated

Provide substantial guidance

Profitability is not the primary ingredient


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Leading with Core Values

Communicate to assure that people understandthe values and believe in the values.

Standardize the values: define what they meanand give examples of the value, tell valuestories.

Practice using the values:

daily, weekly, monthly.

Encourage people to use the values to makedecisions.


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Leading with Core Values

Align to practices and systems with the values:

rewards, information sharing, measures,

meetings, teams, etc. Recognize people and groups that practice the

values. Inform others about how the values were

used to make a decision. Correct those who do not use the values or

violate them.


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CORE VALUES: EXAMPLES

MERCK

Corporate social responsibility

Unequivocal excellence in all aspects of the companyScience-based innovation

Honesty and integrity

Profit, but profit from work that benefits humanity


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PHILIP MORRIS

The right to freedom of choice

Winningbeating others in a good fightEncouraging individual initiative

Opportunity based on merit; no one is entitled to anything

Hard work and continuous self improvement


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SONY

Elevation of the Japanese culture and national status

Being pioneernot following others; doing the impossible

Encouraging individual ability and creativity

.


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Nordstrom

Service to the customer above all else

Never being satisfied

Hard work and individual productivity

Id tif i l


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Identifying core values:

What core values you personally bring to work?What would you tell your children?

If you have enough money to retire, would you

continue to live those values?

Can you envision them being as valid for next100 years?

Would you hold them even if they become

disadvantageous?

If you start a new organization, what core

values you would build into it, regardless of

industry?

Core Purpose


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Core Purpose

Fundamental reason for being

Not to be confused with goals or strategies of thefirm

Purpose itself does not change, but it inspireschange

Its a guiding star on the horizon - forever pursued

but never reached

Core Purpose is a companys raison detre, not


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a goal or business strategy

3M : To Solve unsolved problems innovatively

Hewlett-Packard : To make technical contributions for the advancement andwelfare of humanity

Mary Kay Cosmetics: to give unlimited opportunity to women

Nike: to experience the emotion of competition, winning, and crushing thecompetition

McKinsey: To help corporations and Govts. be more successful in 100 years

Merck : To preserve and improve human life

Wal-Mart : To give ordinary folk the chance to buy the same things as richpeople

Walt Disney : To make people happy


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ROLE OF CORE IDEOLOGY IS TO

GUIDE AND INSPIRE, NOT TODIFFERENTIATE

Core ideology needs to be meaningful

and inspirational to people inside the

organization; it need not be exciting tooutsiders.


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A CLEAR AND WELL ARTICULATED

IDEOLOGY ATTRACTS TO THECOMPANY PEOPLE WHOSE PERSONAL

VALUES ARE COMPATIBLE WITH THE

COMPANYS CORE VALUES

CORE VALUES AND PURPOSES CANNOT

BE IMPOSED ON THE PEOPLE

E i d F


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Envisaged Future

BHAGS Vivid Description

Huge, daunting

goalsClear & compelling,tangible

Unifying, inspiring,engaging

Making goals

imaginable

The minds eye

Hopeful,passionate,

inspiringimages & symbols

1. Difficult Target2. Common enemy3. Role-model

4. Internal -


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ENVISIONED FUTURE

Big, Hairy, Audacious Goals : Aid Long TermVision

BHAGs can be quantitative or Qualitative

Target, common enemy, role-model or internal transformation

Become a $125 billion company by 2000 (Wal-Mart)

Democratize the automobile (Ford Motors, 1900)

Common-enemy

Crush Adidas (Nike, 1960)

Yamaha wo tsubusu! We will destroy Yamaha! (Honda, 1970)


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ENVISIONED FUTURE

Vivid Description

Vibrant, engaging and specific description.

In 10-20 yrs. What would we love to see?

What will a writer say?

Passion, emotion and conviction are essential parts

of the vivid description


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Sony in the 50s

CORE IDEOLOGY

CORE VALUES

Elevation of Japanese

culture & national status Being a pioneer-not

following others, doing theimpossible

Encouraging individualability & creativity

PURPOSE

To experience the sheer joy

of innovation & the

application of technologyfor the benefit & pleasure

of the general public


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SONY [Contd.]

ENVISIONED FUTURE

Become the company mostknown for changing the

worldwide poor-qualityimage of Japanese products

VIVID DESCRIPTION

We will create products

that become pervasivearound the world.

be the 1st Japanesecompany to go into the U.S.market & distribute directly

succeed with innovations thatU.S. companies have failedat- such as the transistorradio 50 years from now,our brand name will be aswell known as any in theworldMIJ will mean +

FOUNDING ROOTS OF VISIONARY COMPANIES ANDCOMPARISON COMPANIES


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COMPARISON COMPANIES

Founding Roots Summary

Visionary

Founding with a

Great Idea

Comparison3M vs. Norton No Yes Comparison Company

Amex vs. Wells Fargo No No Visionary Company

Boeing vs. McDonnell Douglas No Yes Comparison Company

Citicorp vs. Chase No No Indistinguishable

Ford vs. GM Yes No Visionary Company

GE vs. Westinghouse Yes Yes Indistinguishable

HP vs. TI No Yes Comparison Company

IBM vs. Burroughs No Yes Comparison Company

J & J vs. Bristol - Myers Yes No Visionary Company

Marriott vs. Howard Johnson No No Indistinguishable

Merck vs. Pfizer No Yes Indistinguishable

Motorola vs. Zenith No Yes Comparison Company

Nordstrom vs. Melville No No Comparison Company

Procter & Gamble vs. Colgate No Yes Indistinguishable

Philip Morris vs. R.J. Reynolds No Yes Comparison Company

Sony vs. Kenwood No Yes Comparison Company

Wal-Mart vs. Ames` No Yes Comparison Company

Walt Disney vs. Columbia No No Comparison Company


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Thanx

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Winning Strategies of Market Driving Organization L1(2)

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