Michael Porter gave us a process for strategy development. It was a very cognitive process (i.e., using conscious mental activities such as thinking, understanding, learning, remembering) that followed prescribed steps: gather the right data, avoid biases, and choose activities that differentiate the firm from competitors. There is one problem with the cognitive development of strategy: […]
Read More… from Why the Best Strategic Thinkers Are Both Rational and Emotional
Although the impact of the 2008 recession was nearly unprecedented in its scope and depth, nearly all organizations will inevitably face setbacks and severe challenges. Stable, resilient companies can meet these challenges head-on and not only ‘survive’ but emerge on the other side intact and strong. Companies can make themselves resilience in one of two […]
Read More… from Organizational Resilience Is Reinforced by These Two Variables
Stakeholder Theory is a view of capitalism that stresses the interconnected relationships between a business, its customers, suppliers, employees, investors, communities and others who have a stake in the organization. Traditional accounting fails to adequately represent the risk and returns of stakeholder activities — i.e. the net value created by ‘stakeholders’. Stakeholders include customers, employees, […]
Read More… from Stakeholder-Focused Accounting: Value Creation and Risks
To make decisions, leaders must understand, to use the vernacular, ‘what is happening’. They must make sense of the events and situations that impact their areas of responsibility; this sense-making not only involves the past and present, but also the future: what is likely to happen. In July of 2005, an innocent man commuting to […]
Read More… from Bad Framing Leads to Bad Decisions and Bad (Even Fatal) Actions
As our perception of corporate governance has evolved, the need for a new and comprehensive way to report on an organization’s performance and sustainability has become apparent. One that takes account not only of financial performance and compliance issues, but one that also looks at an organization's strategy, overall governance, performance and commercial outlook – […]
In finance, a capital asset's sensitivity to risk is often represented by the quantity beta (β), and investment opportunities that have a high risk profile are known as ‘high beta’ stocks. In this research it is hypothesized that ‘high beta’ stocks are unduly influenced by sentiment due to the investment decisions taken by ‘noise’ traders. […]
Read More… from Beware of Over-Optimistic Investors Skewing High-Risk Stock Prices
Companies struggle with two apparently contradictory goals. They want their brands to be central in their category — in other words, the brand of record, similar to the position held by Coca-Cola in the soda category or McDonald’s in fast food. At the same time, however, they want their brands to be distinctive, standing out […]
Read More… from Mapping Brand Strategy: Balancing Centrality Vs Distinctiveness
Many organizations must deal with multiple ‘logics’ that come with different and often conflicting or competing rules of the game. For example, organizations in the medical field must balance the logics of science and care. Companies in the micro-finance industry balance commercial and development logics: they are bankers who are also involved in advancing developing […]
Read More… from The Role of Identity When an Organization’s Purpose Changes
Research has shown that downsizing will often have a direct negative impact on customer satisfaction, and this negative impact results in a decline in business performance. This causal chain seems clear and intuitive. New research confirms the assumption that downsizing hurts customer satisfaction, and as a result, reduces the financial performance of the company. However, […]
Read More… from When Does Downsizing Hurt Customer Satisfaction?
Shanghai Zhenhua Heavy Industries (ZPMC), a company that specialized in the large-scale cranes used to load containers onto ships, burst on the heavy machinery landscape in 1992. At that time, the global market for large-scale container cranes was growing fast as ports were having to handle more and more super-sized container vessels. The industry was […]
Read More… from A Lesson from China: Growth Is Not Eternal So Be Prepared
