1338 Posts Found

Resources come in two forms—assets and capabilities—and it’s important not to confuse them. Understanding assets is not that hard. […] People-based skills and capabilities can be even larger sources of value, but they are much harder to assess. […]

Capabilities are relative, so an external lens is critical. Formal benchmarking is one obvious method. Another is to get honest input on strengths and liabilities from people … [ Read more ]

Content: Quotation | Author: Dan Simpson | Source: McKinsey Quarterly | Subjects: Management, Organizational Behavior, Strategy

Capabilities are […] the conduit between strategy and execution, and a failure to assess capabilities objectively is often at the root of execution problems. What, in retrospect, is ascribed to poor execution instead has its roots in an unexpectedly large gap between a company’s capabilities and the ones needed to deliver the strategy successfully. This gap exists, in part, because of another mismatch: between the … [ Read more ]

Content: Quotation | Author: Dan Simpson | Source: McKinsey Quarterly | Subjects: Execution, Management, Strategy

Truly great businesses, earning huge returns on tangible assets, can’t for any extended period reinvest a large portion of their earnings internally at high rates of return.

Content: Quotation | Author: Warren Buffett | Source: BsinessWeek | Subjects: Business Rules, Management, Strategy

Pigeonholing business units into categories like “dogs” and “stars” gives short shrift to the most important elements of corporate strategy.

Content: Article | Author: Phanish Puranam | Source: INSEAD Knowledge | Subject: Strategy

Companies need ambidextrous leaders who can simultaneously exploit and explore their markets.

Content: Article | Author: Theodore Kinni | Source: Stanford University | Subjects: Management, Strategy

CEO Adrian Gore describes how the South African company has been shaking up its industry through business-model innovation and explains what helps to catalyze new ideas.

Content: Case Study | Author: Adrian Gore | Source: McKinsey Quarterly | Subjects: Innovation, Strategy | Company: Discovery

As an illustration of how executives get caught up in a short-term EPS focus, consider our experience with companies analyzing a prospective acquisition. The most frequent question managers ask is whether the transaction will dilute EPS over the first year or two. Given the popularity of EPS as a yardstick for company decisions, you might think that a predicted improvement in EPS would be an … [ Read more ]

Content: Quotation | Authors: David Wessels, Marc H. Goedhart, Tim Koller | Source: McKinsey Quarterly | Subjects: Management, Mergers & Acquisitions, Strategy

Creating shareholder value is not the same as maximizing short-term profits—and companies that confuse the two often put both shareholder value and stakeholder interests at risk. Indeed, a system focused on creating shareholder value from business isn’t the problem; short-termism is.

Content: Quotation | Authors: David Wessels, Marc H. Goedhart, Tim Koller | Source: McKinsey Quarterly | Subjects: Business Rules, Management, Strategy

The guiding principle of business value creation is a refreshingly simple construct: companies that grow and earn a return on capital that exceeds their cost of capital create value.

Content: Quotation | Authors: David Wessels, Marc H. Goedhart, Tim Koller | Source: McKinsey Quarterly | Subjects: Business Model, Business Rules, Management, Strategy

Scenario planning can broaden the mind but can fall prey to the mind’s inner workings. Here’s how to get more out of planning efforts.

Content: Article | Authors: Bernardo Sichel, Drew Erdmann, Luk Yeung | Source: McKinsey Quarterly | Subject: Strategy

Thales Teixeira studies three of the most successful “platform” startups to understand the chicken-and-egg challenge of how companies can attract their first customers.

Content: Article | Authors: Michael Blanding, Thales S. Teixeira | Source: Harvard Business School (HBS) Working Knowledge | Subjects: Marketing / Sales, Strategy

Competitors are a startup ghost story. First-time founders think they are what kill 99% of startups. But 99% of startups die from suicide, not murder. Worry instead about all of your internal problems. If you fail, it will very likely be because you failed to make a great product and/or failed to make a great company.

99% of the time, you should ignore competitors. Especially ignore … [ Read more ]

Content: Quotation | Author: Sam Altman | Subjects: Competition, Entrepreneurship

Adobe executives discuss the company’s move from selling shrink-wrapped products to offering web-based software and services.

Content: Case Study | Source: McKinsey Quarterly | Subjects: Marketing / Sales, Strategy | Company: Adobe Systems

Some ideas, such as luxury goods and many smartphone apps, are destined for niche markets. Others, like social networks, work at global scale. Explicitly considering the appropriate magnitude and reach of a given idea is important to ensuring that the right resources and risks are involved in pursuing it. The seemingly safer option of scaling up over time can be a death sentence. Resources and … [ Read more ]

Content: Quotation | Authors: Erik Roth, Marc de Jong, Nathan Marston | Source: McKinsey Quarterly | Subjects: Innovation, Management, Operations, Strategy

New research shows that the trick for companies is to combine speed with stability.

Content: Article | Authors: Aaron De Smet, Chris Gagnon, Michael Bazigos | Source: McKinsey Quarterly | Subjects: Management, Strategy

Governing beliefs reflect widely shared notions about customer preferences, the role of technology, regulation, cost drivers, and the basis of competition and differentiation. They are often considered inviolable—until someone comes along to violate them. Almost always, it’s an attacker from outside the industry. But while new entrants capture the headlines, industry insiders, who often have a clear sense of what drives profitability, are well positioned … [ Read more ]

Content: Quotation | Authors: Marc de Jong, Menno van Dijk | Source: McKinsey Quarterly | Subjects: Innovation, Management, Strategy

Following the leader is a dangerous game. It’s better to focus on building an organization and culture that can realize the strategy that’s right for you.

Content: Article | Authors: Jay Scanlan, Paul Willmott, Tanguy Catlin | Source: McKinsey Quarterly | Subjects: IT / Technology / E-Business, Strategy

A consistent finding in our research is that about 75 percent of all growth is a function of the markets in which businesses compete—portfolio momentum—and the acquisitions they initiate. In other words, just 25 percent of a company’s growth typically comes at the expense of competitors. We highlighted this analysis before the market downturn in 2008, and it has continued to hold true since then. … [ Read more ]

Content: Quotation | Authors: Sven Smit, Yuval Atsmon | Source: McKinsey Quarterly | Subjects: General, Management, Strategy

Co-created by 470 “Business Model Canvas” practitioners from 45 countries, the book features a beautiful, highly visual, 4-color design that takes powerful strategic ideas and tools, and makes them easy to implement in your organization. It explains the most common Business Model patterns, based on concepts from leading business thinkers, and helps you reinterpret them for your own context. You will learn how to systematically … [ Read more ]

Content: Book | Authors: Alexander Osterwalder, Yves Pigneur | Subjects: Innovation, Strategy

A true marketplace needs natural pull on both the consumer and supplier side of the market. Aggregating suppliers is a necessary, but insufficient step on its own. You must also organically aggregate demand. With each step, it should get easier to acquire the incremental consumer AS WELL AS the incremental supplier. Highly liquid marketplaces naturally “tip” towards becoming a clearinghouse where neither the consumer nor … [ Read more ]

Content: Article | Author: Bill Gurley | Subjects: Economics, Entrepreneurship, Strategy