I was privileged to attend the annual conference of the Strategic Management Society, held recently in Berlin under the theme of 'Strategies that Move the World'. It is an annual event which brings together the leading business school academics from around the world, as well as a limited participation of consultants and business professionals. The goal of such an encounter is to discuss the latest research with the aim of enriching strategic thought, and ultimately, improving competitiveness in companies.
I have been attending these annual events over the last three decades, starting with my first conference in Amsterdam in 1988. Since that time, I have witnessed the birth of new strategic perspectives or theories which have fuelled innovation in the various consultancies I have worked for throughout my career. Discussed at this forum, long before they were published and made public, were such topics as the 'Competitiveness of Nations' by Michael Porter; 'Core Competencies' as defined by CK Prahalad and Gary Hamel; 'Smart Organizations' and 'The Fifth Discipline' by Peter Senge; 'Disruptive Innovation' by Clayton Christensen; 'The Delta Model' by Arnold Hax; and, 'Intellectual Capital' by Göran Roos, to name but a few.
This year I attended the event with the same expectations as always, that is, to find some guiding light with which to provide some sense of direction to help us wade through the growing complexity of our business environment. This complexity is indeed not only the consequence of the prolonged recession we find ourselves in, but it is also due to the volatility of many markets and the emergence of new relevant players on the scene. As we deal with all these issues, we need to struggle against social inequality and seek out new business models for the future, whilst we consider changing client behaviours and the influence of industry 4.0.
Despite not coming away with any truly earth-shattering insights this time, I do have some interesting lines of work with which to design strategic frameworks for organisations. In order to come up with new and more innovative business models, I concur with Ralph Amit (a leading professor in the field of strategies based on resources) who advocates ongoing interaction between the changes taking place in society, with their consequent and increasing weight due to the globalisation of business activity, and the adaptability of the organisation's identity.
While synthesizing information can be enormously risky, I shall attempt to outline below some of the main ideas related to strategic thinking which were laid out during the sessions, and which might help some decision-makers in Basque companies to stop and think:
- Strategic planning is unique to every company, and it is that specific individuality where we ought to develop further. Fewer glamorous generalist theories, less repetition of competitive strategies, and more strengthening of one's own culture and business project.
- New disruptive business models which are taking advantage of digitalisation to deal with unsatisfied client needs, and improving both internal operations and co-operation with other players. Many of these disruptive innovations come from changing the logic of the paradigm; that is to say, transitioning from an attitude of 'strategy is developed whilst assigning resources' to one where the logic of a new business model breaks the rules.
- Promote the ongoing interaction between the company and its clients who inform the company directly of their expectations and needs, who participate in the creation of the service, and who evaluate the company constantly. It becomes critical to personalise the offer and create complicity with clients.
- Incorporate converging digitalisation and technologies into industrial companies so as to shorten the value chain, promote innovation and the implementation of strategies focused on giving value to clients.
- Develop employee-shared organisations which involve employees by virtue of sharing both risk and profits, and which provide for personal and professional development. Developing talent will be essential in order to be globally competitive.
- Promote initiatives aimed at developing intergenerational commitment amongst all individuals in the organisation. As Siemens CEO Joe Kaeser put it: “Our goal is that future generations have a better place to work.”
- Create models which can measure the company's performance beyond strictly economic or financial criteria, and which link the company's contribution to society and the development of the business ecosystem where it does business.
- Develop business projects which bring value to society, income distribution, governance and collaboration with NGOs, both in its strategy and business practice. Some academics consider it fundamental to fight against social inequality (avoiding the traditional structure of CSR), whilst others accept it as a lesser of two evils so as to legitimatise business undertakings in the public eye.
In conclusion, there were three basic elements to business success which emerged from the discussions: 1) systematic exploration of the future (as expressed by Dany le Rouge in May '68); 2) irreverent questioning of the established order (as espoused by Steve Jobs in his early days); and, 3) the search for solid and sustainable projects.
Read the original article in El Economista.