Corporate Strategy News is a news and information resource designed to help business executives in decision-making. Recently they published an article entitled “Top Concerns for CEO’s in 2013.” The basis of the article came from several top executives who were surveyed about planning for the business year ahead. There were 3 main points that were emphasized in the article: building a contingency plan, minimizing risk and managing talent. I view these points as the “lessons learned” from 2012.
Contingency plans are a hot topic for businesses as a direct result of Hurricane Sandy and other major natural disasters that have recently occurred. For example, many businesses have been content to keep all records and files on site. This tactic has been proven to be deficient in emergency planning. Contingency plans address these issues and are more than just “disaster planning.” Managers should have several plans that address numerous scenarios. This provides organizations with greater flexibility so they can “weather any storm.”
Minimizing risk is also vital to a firm’s success. Risk is inherent in any industry, but there are a number of ways it can be reduced. One of the greatest ways to reduce risk is through improved internal auditing. If a firm is more transparent it’s easier to find errors and improve business processes. Given some of the uncertainties for next year, risk management also becomes increasingly more important.
The last major point of the article emphasized the importance of talent management and it’s impact to a corporation. Talent management should be a role that extends beyond the human resources department. Unfortunately many corporations often overlook this attribute. CEO’s and other executives should take an active role in talent management so that leaders can be identified and rewarded. Human capital will become more important next year as the economy strengthens.
I found this article to really hit on some key issues and problems that exist within various corporations today. None of the above mentioned points should come as a surprise, but it should be an “eye opener” for executives that haven’t taken these critical points into consideration. Of course these aren’t the only factors that impact success, but given the circumstances and some of the recent events that have occurred, these points should not be ignored.
This past year has been an exciting one, to say the least, for many corporations. The challenges that lie ahead with the looming fiscal cliff, problems with major money-lenders and other uncertainties will make strategic planning a priority for all businesses in 2013. Every corporation will need to have a unique competitive advantage going forward, and addressing some of these key issues can help them prosper next year.
If you would like to read this article you can find it at the link below.
Globalization is a term that we seem to cover in nearly every business course. Booz & Company put out an interesting article last month about globalization and its importance to business strategies as we move into the future. The concept of globalization is simple to understand, but its successful implementation is far from being a simplistic task.
Let’s consider Walmart as an example. Walmart is arguably one of the most successful companies in the United States. They are the 3rd largest public corporation in the world and employ more than 2 million people worldwide. Walmart recently entered the South Korean and German markets. Shortly thereafter they closed operations in these markets as a result slow growth rates and lack of market share, among other things. There obviously seems to have been some poor decision making and analysis that occurred before entering these markets.
So how does a corporation successfully compete globally? The article suggests a focus on “localization” first. This involves an investment of time and money into better understanding how globalization exists in a corporation’s home country first. Few companies have been able to quantify the untapped potential for growth in their own country. If this information could be better understood, these companies would recognize an increasing importance for establishing global connections.
The article further implies that globalization needs to be done with a smarter and more integrated approach. Global depth and global breadth will become more important in creating successful, global business strategies. In simple terms global depth represents how much of an economy is devoted to exports and imports. On the other hand global breadth is the extent to which international trade flows are spread globally versus confined to a particular set of partner nations. Without understanding the depth and breadth that exists within a country, it is nearly impossible for a corporation to enter a new market successfully.
All of this talk about globalization makes me think of my own corporation. I was surprised to find out that my definition of globalization was mostly inaccurate. My corporation conducts most of its business within the United States, but we have recently started to sell products in England. I thought this now put our company into the “globalized” category. In reality, we are still a domestic company that now conducts some international transactions. I’m still not sure if this makes our corporation any better positioned for the future, other than now having some new clients to serve. I struggle to understand whether the costs associated with entering these new markets will actually lead to long-term success. Obviously a lot of time, effort and money is necessary to implement a successful market entry strategy. As the article suggests, the world is only 10 to 25 percent globalized, so businesses such as my own will have to keep pace with changes to avoid similar failures that happened to Walmart.
If you would like to read the Booz & Company article please follow the link below: