341 Posts found for Source: Boston Consulting Group (BCG)

Sometimes the best opportunities lie hidden in something that, at first glance, makes no sense. Idiosyncratic customer preferences or employee behavior can lead to aberrations in business results. How do you deal with these anomalies?

One common response is to ignore them. Most organizations try to contain or suppress anomalies, for fear they will draw attention to departures from standard operating practice. When senior managers learn … [ Read more ]

Content: Article | Author: Lawrence Shulman | Source: Boston Consulting Group (BCG) | Subject: Management

As deconstruction spreads, integrated value chains break apart into stand-alone businesses, or layers. Some of these layers have the potential to become the “sweet spots” of the deconstructed value chain�the places where the most value is concentrated and where the highest profits and returns can be found.

Editor’s Note: although this article was written in early 1999 and cites Enron as an example, it is … [ Read more ]

Content: Article | Author: David Edelman | Source: Boston Consulting Group (BCG) | Subject: Strategy

Vision creates intent. Culture determines action. Often the two are out of sync. When they are, culture can actually undermine vision and prevent a company from achieving essential business goals.

Content: Article | Author: Eric E. Olsen | Source: Boston Consulting Group (BCG) | Subject: Organizational Behavior

When growth rate exceeds the cost of capital, the competitive relationships become inherently unstable. Aggressive competition then produces revolution instead of evolution in competitive relationships.

Content: Quotation | Source: Boston Consulting Group (BCG) | Subjects: Competition, Strategy

A business should be regarded as a system in equilibrium. An effective corporate strategy is a predetermined sequence for the allocation of resources in such a fashion that the equilibrium will be shifted to a more favorable relationship.

Content: Quotation | Source: Boston Consulting Group (BCG) | Subject: Strategy

It is possible to demonstrate that at various stages of product development the critical strategy element shifts from technical lead, to financial resources, then organization policy coordination and finally to market share.

It is also possible to demonstrate that competitive equilibrium is highly unstable under certain conditions, conditionally unstable under others, and finally the equilibrium will become almost certainly essentially stable.

Content: Quotation | Source: Boston Consulting Group (BCG) | Subjects: Competition, Strategy

Companies that are avoiding mergers and acquisitions in an economic slowdown may be missing a major strategic opportunity. According to this study by the Corporate Development practice of The Boston Consulting Group (BCG), mergers that take place during periods of below-average economic growth have a higher likelihood of success. And they generate considerably more shareholder value, on average, than deals taking place during periods of … [ Read more ]

Content: Article | Authors: Alexander Roos, Chris Neenan, Daniel Stelter, Jeffrey Kotzen | Source: Boston Consulting Group (BCG) | Subject: Best Practices

Failure to gain market share even with superior costs is failure to compete. This failure is also a failure to achieve even lower costs.

Content: Quotation | Source: Boston Consulting Group (BCG) | Subject: Competition

The majority of the products in most companies are cash traps. They will absorb more money forever than they will generate. This is true even though they may show a profit according to the books of account. Continued investment sends good money after bad. Escape from the trap requires extreme measures. Either stop investing and manage solely to maximize cash withdrawal, or invest so heavily … [ Read more ]

Content: Quotation | Source: Boston Consulting Group (BCG) | Subjects: Competition, Economics

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In considering differentiation, it is important to include all of the conditions of the transaction, as well as the product itself. Service, reliability of vendor and delivery times are likely to be as important as inherent product characteristics. There are often highly differentiated suppliers in markets for commodity products.

Content: Quotation | Source: Boston Consulting Group (BCG) | Subject: Marketing / Sales

Averages hide more than they disclose.

Content: Quotation | Source: Boston Consulting Group (BCG) | Subject: Statistics

Business thinking starts with an intuitive choice of assumptions. Its progress as analysis is intertwined with intuition. The final choice is always intuitive. If that were not true, all problems of almost any kind would be solved by mathematicians with nonquantitative data.

The final choice in all business decision is, of course, intuitive. It must be. Otherwise it is not a decision, just a conclusion, a … [ Read more ]

Content: Quotation | Source: Boston Consulting Group (BCG) | Subjects: Decision Making, Thought

Whenever a front or zone of competitive parity becomes stable or static, then “bourgeois” competition will develop. Such “bourgeois” competition exists when the defense always acts as a hawk and the offense always acts as a dove. This is a mutual recognition of mutually predictable behavior.

Content: Quotation | Source: Boston Consulting Group (BCG) | Subject: Strategy

The fewer the number of competitive variables that are critical, then the fewer will be the number of competitors. If only one factor is critical, then no more than two or three competitors are likely to coexist. Only one will survive if the available market shrinks. This is the “rule of three and four.”

Content: Quotation | Source: Boston Consulting Group (BCG) | Subject: Strategy

Failure to seek patterns in business results in either analysis paralysis or firefighting. The forest becomes lost in the trees. Patterns filter extraneous information, reduce complexity, focus on the essential. Only key patterns of competitive behavior are evaluated.

…Most of the major ideas in business strategy are conceptual rules of thumb about economic competition. The experience curve, the growth-share matrix, average costing, and the environments matrix … [ Read more ]

Content: Quotation | Source: Boston Consulting Group (BCG) | Subject: Strategy

The fact is that some markets yield more opportunities for advantage than others, and some none at all. Some companies invest heavily in pursuit of the mirage of a secure future competitive edge. Nowhere is this more likely to end in disappointment than where there is blind faith in the value of market share or in the rewards of technological superiority.

Content: Quotation | Source: Boston Consulting Group (BCG) | Subjects: Competition, Strategy

Many executives believe that competitive advantage is best achieved by providing the most value for the lowest cost. This is the traditional paradigm for corporate success. Providing the most value for the lowest cost in the least amount of time is the new paradigm for corporate success.

Content: Quotation | Source: Boston Consulting Group (BCG) | Subjects: Competition, Strategy

This article argues that a big new managerial challenge is to lower transaction costs and that the way to do this is to make trust scalable. It’s not an argument you hear every day. In fact, it may surprise people. Most of us think that IT has lowered transaction costs. But the authors present evidence that our obsession with lowering production costs has led to … [ Read more ]

Content: Article | Authors: Bob Wolf, Philip Evans | Source: Boston Consulting Group (BCG) | Subjects: Economics, Miscellaneous

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