Seamlessly gathered information can be used to save costs,
to provide a tailor-made service to individual clients, and to sell
more—often using the internet.
The American online retailer Amazon.com has redefined
book selling. Its culture appreciates the potential of technology,
with the company using information in four key ways:
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To minimize risks by analyzing information from millions
of customers to see how and when they purchase, enabling
Amazon.com to reduce the level of risk.
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To reduce costs by using technology to control the way it manages
its inventory and suppliers.
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To add value and help customers by offering reviews of books and
free downloadable information, and by treating its home page
as an individual storefront for each customer—for example by
tailoring lists of suggested titles that the customer may enjoy
based on previous purchases.
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To innovate. Amazon believes that, to rival its competitors, an
innovative approach is essential in order to improve the value
and service offered to consumers.
What matters is not simply what information exists, but how that
information is used to build competitive advantage. Interestingly,
many other retailing companies have now followed Amazon’s lead. For example, Apple’s iTunes and iStore have done for
music retailing what Amazon did for book selling, using many of
the same principles.
Practice
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Treat each customer as an individual. For example, music
retailer iTunes tracks the purchases of individual clients
and provides a customized webpage designed to introduce
a client to new buying opportunities that appeal to his/her
personal taste.
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Use the internet to provide information for the individual—even
if your business does not carry out its primary operations online.
By collecting customers’ email addresses, a business can develop
a highly valuable and intimate marketing strategy.
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Smaller businesses and freelance workers may be able to
research more in-depth information on each client. This can
then be organized into an accessible database, with subheadings
for each client covering all areas of relevant information.
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If your organization is unable to seamlessly track consumer
trends, use incentives such as free products for customers who
volunteer their information. Similarly, you should also provide
rewards for customers who agree to receive information on your
organization—the marketing should be entertaining, lively,
appropriate, and relevant.
A company with a positive self-image and sense of pride
will be more unified and efficient, with a stronger “employer brand.”
When employees respect and appreciate the organization they
work for, then their productivity, quality of work, and job
satisfaction increase.
Are your employees proud of working for your business? This sense
of pride may result from the organization’s purpose, success, ethics,
the quality of its leadership, or the quality and impact of its products.
An example of this is Taylor Nelson Sofres (TNS), a leading market
information company, with over 14,000 full-time employees
across the world. It collects, analyzes, and interprets information
for clients, provides research on business and market issues, and
conducts social and political polling.
The firm’s network spans 70 countries, and has been largely
assembled through acquisition. Consequently, employees were
often more loyal to their local “in-country” TNS business than to
the group, which seemed remote or foreign. However, when one
of its executives was caught in the tsunami in South Asia in
December 2004, TNS donated $250,000 to UNICEF to aid
relief operations. This altruism brought the company together, as
employees were pleased to be working for an organization with
values that they respected.
As TNS illustrates, simple and positive gestures can achieve
impressive results in terms of employee satisfaction, pride, and
motivation.
Practice
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Carry out acts of corporate social responsibility—such as
donation, fundraising, or simply enacting more compassionate
business practices. These all serve to make current and potential
employees feel proud to work with your organization.
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Ask employees what they value—what would they like their
employer to do?
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Provide opportunities for employees to engage in fundraising
and volunteering activities.
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Avoid negative business practices. Employees will be less
motivated to work within an organization that is viewed negatively
in society.
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Remind employees of the ways their services benefit society;
how the everyday tasks they perform make a positive difference
within society.
Scenario planning enables organizations to rehearse the future,
to walk the battlefield before battle commences so that they are
better prepared. Scenarios are not about predicting future events.
Their value lies in helping businesses understand the forces that are
shaping the future. They challenge our assumptions.
In the 1960s, Pierre Wack, Royal Dutch/Shell’s head of group
planning, asked executives to imagine tomorrow. This promoted
sophisticated and responsive strategic thinking about the current
situation, by enabling them to detect and understand changes.
Pierre Wack wanted to know whether there were other factors in the
supply of oil, besides technical availability, that might be uncertain
in the future. He listed stakeholders and questioned the position
of governments in oil-producing countries: would they continue
increasing production year on year? By exploring the possible
changes to government policy, it became apparent that these
governments were unlikely to remain amenable to Shell’s activities.
Many oil-producing countries did not need an increase in income.
They had the upper hand, and the overwhelming logic for the oil-
producing countries was to reduce supply, increase prices, and
conserve their reserves.
When the 1973 Arab–Israeli War limited the supply of oil, prices
rose fivefold. Fortunately for Shell, Wack’s scenario work meant
Shell was better prepared than its competitors to adapt to the new
situation—saving billions of dollars, it climbed from seventh to second place in the industry’s profitability league table. It knew
which governments to lobby, how to approach them, where to
diversify, and what action to take with each OPEC member.
Scenario planning enables leaders to manage uncertainty and
risk. Above all, scenarios help firms to understand the dynamics
of the business environment, recognize new opportunities, assess
strategic options, and take long-term decisions.
Practice
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Scenarios are not predictions: they are used to understand
the forces shaping the future. What matters is not knowing
exactly what the future will look like, but understanding the
general direction in which it is moving—and why.
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Plan and structure the scenario process: for example,by agreeing
who will be involved.
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Discuss possible futures (usually by working back from a possible
view of the future).
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Develop the scenarios in greater detail.
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Analyse the scenarios: why they might occur, what you would do if they did.
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Use the scenarios to shape decisions and priorities.
