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Experimentation vs. Innovation

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Innovation has become quite fashionable.   It shows up lately in almost every company’s annual report and is the subject of countless articles, books and educational offerings.  Legitimately, both the culture and process of innovation, in all its complexity, has been successfully implemented in a number of companies, leading to tremendous increases in shareholder value.  3M quite consistently and Apple more dramatically spring to mind.

Although innovative “breakthroughs” are very much part of this trend and are to be revered and celebrated, ...

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Embedded within the Customer

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An ideal situation can be to become embedded within your customer, whereby your
products/services are an absolutely essential element to them as they deliver
consistently and effectively on their value proposition.  But, how do you know when you
are truly embedded?  Here are some indicators:

• You are referred to as a supplier who “gets us” or “shares our vision”.
• Collaborative discussions constantly drift to making them more relevant or
distinctive, i.e., more competitive.
• You are called on for ...

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Complacency Is Overrated

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“The more successful companies become, the more difficult it is for them to recognize when they must change.  We all know that many industries, such as entertainment, education, publishing, and financial services, are going to look very different tomorrow, yet today’s market leaders will probably be the last ones to transform themselves, even if they realize they must in order to survive.  Why do companies find it so tough to tackle the obvious?  One reason could be that over time ...

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Reinvestment… It’s about More than the Balance Sheet

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Early in my career, while presenting a performance and strategy update to our board of directors, I asked one of the directors, a top executive at a Fortune 100 company, what their capital expenditure policy was.  At the time, anything over $100,000 had to be approved way up the corporate ladder.  It then went to a  capital appropriation committee of the board.  I then asked him about other investments, like in people and research & development.  He said that these items ...

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Enhancing Speed, Scale and Sustainability

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In my role as CEO, how can a trustworthy, actively-engaged Board or Trusted Advisor help me?

Speed
• Frame things up… provide context, linkage and congruency… easier to do
when there are others who are both objective and “invested” to talk to
• Stay on “CEO” agenda… working around blind spots… keeping focused
and on task… less chance of getting stuck
• Promote integrated thinking (around competing decision alternatives)… chance to be
creative out loud without having to manage the occasional feeling of being out of
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The Will to Dominate

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You’ve no doubt heard the expression, “Sustainable Competitive Advantage”.  Have you ever actually seen it?  Can you identify a company that truly has one?  Great if you have.  Unfortunately, I haven’t.

The hang up for me is the “sustainable” part.  Even if hundreds of millions of dollars or more are spent on creating or defending a supposedly “unique competitive advantage”, there is always the threat that it can be overtaken.  Often the threat is made real by someone leapfrogging the imagery, ...

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Scaling Up… Rather than Down

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Recently, there have been some very impressive examples of companies scaling down…

• Rapidly executed contingency plans, as demand visibility virtually disappeared overnight.
• Very deep cost cuts, without totally abandoning the company’s strategic course.
• Major re-castings of company business models, on the presumption that the downturn may actually be a “lingering condition”, if not a “seismic shift”.

However, what about the capacity to scale up? Were these companies growing rapidly before the downturn? Have they consciously and proactively invested with ...

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Are We Having the Right Conversation?

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Often, at board meetings, while listening to management updates, we as board members are thinking to ourselves, “What’s your point?” The difficulty seems to be that, at times, management (as a whole) can have trouble crystallizing the meaning and potential impact of the information they are conveying.

“Should I invite them (the board members) into my world and provide the detail leading up to every predicament or decision, or should I simply reflect on the predicaments and decisions as they were ...

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What Is the Customer Paying For?

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Recently, I saw a television ad for the Kia Optima.  I think it’s a mid-size sedan.  The thrust of the message was that the car was so incredibly feature rich that it stood alone amongst all of its perceived competition.  They suggested that there was absolutely no comparison to their product.  The final shot was a very effective visual where the Kia was placed on top of a large circular rise (like one seen at an auto show) and to ...

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Transitioning During Ownership… Some of the Alternatives

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With private equity groups, the buyout model is to invest (usually along side a good
management team) in a business with potential to grow or one that can otherwise capture
previously untapped opportunities.  They then sell it at a higher price and probably at a
higher multiple of earnings.  Everything seems fine through the investment period (3 to 7
years) until they discover an experience and/or capacity issue within the executive team.
Sometimes it’s a gap within the overall makeup ...

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