Jan 20, 2011 | Demand chains, Management, OE, Operations, Strategy
Some time ago I mused that perhaps the worm was slowing if not turning, in relation to local manufacturing, rather than buying in from China as the default option.
The crisis in the US, far worse than anything in this country, had to lead to structural change in the US economy, as the sort of structural change necessary usually only ever occurs when there is little option but to change, as continuing on is simply not an option.
It seems the swallows are appearing in the US, the early trendsetters are thinking twice about the downside of “offshoring”. Loss of IP control, sovereign risk, long and inflexible supply chains, transaction costs in the supply chain and management, and so on.
It makes economic and social sense to manufacture amongst the network of services and capabilities required to be sustainably successful, rather than taking the short term apparent cost reduction that really ends up costing more.
With China suffering increased inflationary pressure, their western export markets tightening wallets, an undervalued currency, and increasing domestic pressures around human rights, pollution, and the distribution of the new wealth, something has to break, somewhere. Wise businesses appear to be weighing the costs and benefits of offshoring, Vs building local capability, considering the long term benefits of development of clusters of innovation and service providers, and lean operations including shortened supply chains, and coming to the conclusion that some things are better done locally.
It will take a long time for the tide to turn, and it will turn very selectively, as many commodity, low value, low technology items will always be cheaper from a low cost environment, but the manufacturing that adds real value will start to trickle home.
Jan 20, 2011 | Innovation, Marketing, Strategy
Often these two terms are used interchangeably, as synonyms, but that are not.
Creativity is a part of the process of innovation, an integral and key part, but nevertheless, just a part. It is, as Sir Ken Robinson so memorably said in his great TED talk, “Creativity is the process of having original ideas that have value” .
By contrast, innovation is to my mind the process of taking the output of the creative process and putting in place the steps to extract and leverage the implicit value of the creativity, making it explicit. Thomas Edison, perhaps the most celebrated inventor of all time, certainly the individual with more patents to his name than anyone else, before or since, famously said “Genius is 1% inspiration, 99% perspiration” recognising the distinction between the creative spark, and the hard work necessary to turn the idea into a product, service, or process.
For enterprises to flourish in today’s competitive world, they need to encourage a culture of creativity, again as stated by Sir Ken in the TED presentation “If you are not prepared to be wrong, you will never come up with anything original” and back that creativity with a management culture that gives the creativity life.
Jan 18, 2011 | Customers, Demand chains, Marketing, Social Media
The retailer Patagonia has as a part of its corporate values a reverence for the environment, it is a core part of their corporate values, and highly relevant to their target market. They wear their hearts on their electronic sleeves by opening up their demand chain on all products to observation and criticism.
An integral part of their web presence is the Patagonia Footprint Chronicles site that provides some details the provenance of all their products with the opportunity for consumers to provide feedback.
This simple, transparent, exercise must be a source of huge value for the Patagonia brand, that targets high quality, and environmental sensitivity in everything they do. This sort of brand transparency is likely to become far more common as consumers increasingly demand facts rather than slogans from marketers, and marketers recognise the competitive value of demand chain transparency, enabled by the web 2.0.
Jan 17, 2011 | Branding, Marketing, Social Media, Strategy
There are lots of people flogging various digitally sophisticated SEO techniques, and they appear to be making a living. However, it seems to me that after all this time most key words worth having, have been taken, registered, and everyone is following similar SEO strategies, so your generic term will not get you to the prized No.1 spot in Google, probably not into the top 10 pages.
Try putting in “Electrician Sydney” as I did recently needing someone to do some work in my house, and there were 4880 entries, taking Google’s suggestion and adding “inner west” where I live, there were 297,000 entries. Not much use, unless you happen to be the .00001% who lucks the No.1 spot, but many keep trying, and paying.
By contrast, if you invent a word , something unique, you have a better chance of coming up on the first page. The downside is that you need to make your target market aware of the word by other means, a challenge .
When you put “Strategyaudit” into Google, this blog comes up No.1, and has done so pretty much for the whole time it has been written, although Google still checks if it is a spelling mistake. My task is therefore to make the specific audience who may be interested in what I write to be aware of the name, then it is easy to find, as all they do is put the word “strategyaudit” into Google, and there its is.
No complicated SEO strategy, simply a strategy to “own” a space of my own making, and being different, the challenge to be relevant to an audience that returns to the blog remains, no SEO can do that for me.
Jan 16, 2011 | Change, Marketing, Social Media
Social media to many “50 something’s” who run most of our large businesses, is just code for wasting time that should be spent productively, but the reality is that social media is rapidly evolving into a potent business tool in several pretty fundamental ways.
- As we can see what is needed, and where far more quickly, the old resource allocation processes have become totally redundant. Allocating resources based on a plan now 12 months old is, as my kids would say “so 20th century”, it needs to be done in response to things happening NOW, and requiring response. This has huge implications on the way organisations democratise decision making at the front lines of market contact.
- As social media becomes more dense, it opens opportunities for collaboration not possible before. This is particularly potent in its ability to immediately mobilise numbers around a cause, location, or combination of both.
- Geographic barriers are no longer relevant as an organising principal. Most multinational businesses face this fundamental change in the dynamics of their organisational structures, but so to do social organisations such as the church.
- The power of social media as a marketing tool is only just starting to be recognised. We have long understood that personal recommendation is the best endorsement you can have, and the web can now offer an electronic version of the recommendation qualified by numbers and independence. Amazons system of recommendations shows the way.
And now, Hollywood has made a film about the beginnings of Facebook, and the motivation and foibles of its founder, surely, that is a sign that social media is now of age.
