PhilosophyHomeServicesWorkKnowledgeContact Us
The economic situation is very difficult as we know on everyone and on every business, mainly the local ones. This is why the first measure that every Owner/CEO/MD is taking is reducing cost and expenses: laying off employees, stopping training programs, reducing or canceling consultancy & advertising agreements etc…this is maybe understandable because Companies are in a survival mode trying to rescue what is remaining from their business. 
But if we think differently about it for a moment, these measures will fire back because if every company be it small or big, local or regional start doing the same thinking putting their company direct interest first, the result will be affecting more and more the other companies they are dealing with and it will have a ripple effect that will return to hurt them as the whole economy suffers. 

We need to acknowledge that all the pieces of an economy are interconnected and when firms cancel a not-so-urgent investment, they are reducing revenues for a number of people who in turn will not be able to purchase the company’s products or services. It is a circular economy that acts like a boomerang.
A good example is what is happening with the banking sector. Everyone knows that if we keep rushing to withdraw cash to be saved in homes, the faster the banks collapse would be. But yet each individual think for himself without admitting that he/she is part of an ecosystem that is threatening to break down on all of us!

What should be done instead is actions driven by a solidarity spirit, trying to support as much as possible each other in this difficult time by avoiding canceling contracts, reducing wages, firing people but instead re-orienting all resources towards what is needed today, changing the priorities; the strategy not the purpose. Exploring and developing innovations & new business models that the new emerging real economy mandates.

By doing that Companies will win on the mid & long-terms as they play a wiser role in reinventing themselves while supporting the smaller providers maintaining the viability of all business sectors ecosystem, vital to sustaining the Lebanese economy .

Cutting cost, although easiest step to make, must not be done without first rethinking what the near future would look like and rather explore smart & fluid reallocation of resources, Strategic Thinking and Scenario Planning should be though off to find the right solutions that may not be obvious at first. 
Solidarity is one of those key themes that could become an overarching strategic plan that can keep us all on the boat and avoiding the ship from drowning by self-inflicted holes.

This Solidarity Theme was dominant in the October Revolution on social and human levels and should be dominant as well on Business level for Lebanon’s sake. “One for all and all for one” should be our new motto.

Carole Ayoub
Partner & Senior Consultant at Brandcell
business designbrandcell newsbranding strategybusiness strategyexperience designcustomer serviceservice designDesign Thinking
Although it is surprisingly hard to create good ones, they help you ask the right questions and prepare for the unexpected. That is hugely valuable.
Scenarios are a powerful tool in the strategist’s armory. They are particularly useful in developing strategies to navigate the kinds of extreme events we have recently seen in the world economy. Scenarios enable the strategist to steer a course between the false certainty of a single forecast and the confused paralysis that often strike in troubled times. When well executed, scenarios boast a range of advantages—but they can also set traps for the unwary.

There is a significant amount of literature on scenarios: their origins in war games, their pioneering use by Shell, how to construct them, how to move from scenarios to decisions, and so on. Rather than attempt anything encyclopedic, which would require a book rather than a short article, I have put forward my personal convictions, based on experience in building scenarios over the past 25 years, about both the power and the dangers of scenarios, and how to sidestep those dangers. I close with some rules of thumb that help me—and will, I hope, help you—get the best out of scenarios.


The power of scenarios

Scenarios have three features that make them a particularly powerful tool for understanding uncertainty and developing strategy accordingly.


Scenarios expand your thinking

You will think more broadly if you develop a range of possible outcomes, each backed by the sequence of events that would lead to them. The exercise is particularly valuable because of a human quirk that leads us to expect that the future will resemble the past and that change will occur only gradually.

By demonstrating how—and why—things could quite quickly become much better or worse, we increase our readiness for the range of possibilities the future may hold. You are obliged to ask yourself why the past might not be a helpful guide, and you may find some surprisingly compelling answers.

This quirk, along with other factors, was most powerfully illustrated in the recent meltdown.
Many financial modelers had used data going back only a few years and were therefore entirely unprepared for what we have since seen. If they had asked themselves why the recent past might not serve as a good guide to the future, they would have remembered the Asian collapse of the late 1990s, the real-estate slump of the early 1990s, the crash of October 1987, and so on. The very process of developing scenarios generates deeper insight into the underlying drivers of change. Scenarios force companies to ask, “What would have to be true for the following outcome to emerge?” As a result, they find themselves testing a wide range of hypotheses involving changes in all sorts of underlying drivers. They learn which drivers matter and which do not—and what will actually affect those that matter enough to change the scenario.


Scenarios uncover inevitable or near-inevitable futures

A sufficiently broad scenario-building effort yields another valuable result. As the analysis underlying each scenario proceeds, you often identify some particularly powerful drivers of change. These drivers result in outcomes that are the inevitable consequence of events that have already happened, or of trends that are already well developed. Shell, the pioneer in scenario planning, described these as “predetermined outcomes” and captured the essence of this idea with the saying, “It has rained in the mountains, so it will flood in the plains.” In developing scenarios, companies should search for predetermined outcomes—particularly unexpected ones, which are often the most powerful source of new insight uncovered in the scenario-development process.

Broadly speaking, there are four kinds of predetermined outcomes: demographic trends, economic action and reaction, the reversal of unsustainable trends, and scheduled events (which may be beyond the typical planning horizon).

    •    Demography is destiny. Changes in population size and structure are among the few highly predictable aspects of the future. Some uncertainties exist (potential increases in longevity, for example), but only at the margin. Sometimes, the effects of these trends are far off—as with Social Security in the United States today—so they are generally ignored. When these trends grow near, however, their effects can be powerful indeed, as when the baby boom generation is on the brink of leaving the workforce.

    •    “You canna change the laws of economics!” Just as Scotty the engineer could not change the laws of physics when Captain Kirk1 demanded more warp speed, so business leaders cannot assume away the laws of economics. If demand shoots up, prices will too—which will limit demand and drive increasing supply—with the result that demand, prices, or both will drop. Nothing increases in price forever, in real terms. We recently saw oil prices more than double and then sink back again by an equal amount. Price changes of this scale inevitably drive supply and demand reactions in every relevant value chain. As in physics, every economic action has a predetermined reaction. These reactions are often ignored in business strategy. If uncovered through scenario planning, however, they can generate powerful insights.

    •    “Trees don’t grow to the sky.” Business plans often extrapolate into the future trends that are clearly unsustainable. Economies are fundamentally cyclical, so beware of politicians bearing tales about the end of boom and bust. Equally, do not build a strategy based on the claim that the business cycle has been tamed. Often, optimistic projections are accompanied by bold claims of a new paradigm. Strategists need to be very cautious about alleged new paradigms. The appearance of even a genuine new paradigm almost always results in a speculative bubble. The “new economy” was a good example. More recently, securitization proved to be another sound idea that resulted in a speculative bubble. And in the past, many new, innovative technologies—railroads and radio, for example—were hailed as “new paradigms” and then promptly led to investment bubbles. A useful test is to project a trend at least 25 years out. Then ask how long can this trend really be sustained. Challenge yourself to try and prove why the shape of the future should be so fundamentally different from the more cyclical past. Chances are you won’t be able to, and this will open your eyes to the possibility of a break in the trend.

    •    Scheduled events may fall beyond typical planning horizons. There is also a simpler kind of predetermined outcome that does not involve any unalterable laws: scenarios must take into account scheduled events just beyond corporate planning horizons. A recent example, the results of which we have already seen, is reset dates on adjustable-rate mortgages. Well before the event, one could have predicted a spike in resets as mortgages sold in 2005 and 2006—the peak years—completed their low, three-year introductory rates. Something bad was going to happen to the economy in 2008. Right now, there is another important “timetable” to watch: the wave of large bond issues that has resulted from banks having to refinance hundreds of billions of dollars of maturing debt. Although these types of scheduled events ought to be common knowledge, they tend to be overlooked in planning exercises because they fall beyond the next 12 to 18 months. Scenarios should account for scheduled events that could have a big impact in the 24–60 month time frame.

While some errors can be avoided by recalling certain fundamental economic and demographic facts or scheduled events, problems of timing will continue to exist. Your company’s strategic planners may know that a massive dollar value of mortgages is about to reset. But when will the market actually wake up to this reality? Financial services cannot grow as a percentage of GDP forever. But at what percentage will this stop? We didn’t know before, and we still don’t know today. Still, the realization that something must happen, even if it is not clear when, leads to the inclusion of at least one scenario in which, say, financial services stop growing sooner rather than later.

Scenarios protect against ‘groupthink’

Often, the power structure within companies inhibits the free flow of debate. People in meetings typically agree with whatever the most senior person in the room says. In particularly hierarchical companies, employees will wait for the most senior executive to state an opinion before venturing their own—which then magically mirrors that of the senior person. Scenarios allow companies to break out of this trap by providing a political “safe haven” for contrarian thinking.

Scenarios allow people to challenge conventional wisdom

In large corporations, there is typically a very strong status quo bias. After all, large sums of money, and many senior executives’ careers, have been invested in the core assumptions underpinning the current strategy—which means that challenging these assumptions can be difficult. Scenarios provide a less threatening way to lay out alternative futures in which the these assumptions underpinning today’s strategy may no longer be true.

Avoiding the common traps in using scenarios

For all these benefits, there is a downside to scenarios. Inexperienced people and companies are prone to fall into a number of traps.

Don’t become paralyzed

Creating a range of scenarios that is appropriately broad, especially in today’s uncertain climate, can paralyze a company’s leadership. The tendency to think we know what is going to happen is in some ways a survival strategy: at least it makes us confident in our choices (however misplaced that confidence may be). In the face of a wide range of possible outcomes, there is a risk of acting like the proverbial deer in the headlights: the organization becomes confused and lacking in direction, and it changes nothing in its behavior as an uncertain future bears down upon it.

The answer is to pick the scenario whose outcome seems most likely and to base a plan upon that scenario. It should be buttressed with clear contingencies if another scenario—or one that hasn’t been imagined—begins to emerge instead. Ascertain the “no regrets” moves that are sound under all scenarios or as many as possible. Ultimately, the existence of multiple possibilities should not distract a company from having a clear plan.

Don’t let scenarios muddy communications

The former CEO of a global industrial company once suggested that scenarios are an abdication of leadership. His point was that a leader has to set a vision for the future and persuade people to follow it. Great leaders do not paint four alternative views of the future and then say, “Follow me, although I admit I’m not sure where we are going.”

Leaders can use scenarios without abdicating their leadership responsibilities but should not communicate with the organization via scenarios. You cannot stand up in front of an organization and say, “Things will be good, bad, or terrible, but I am not sure which.” Winston Churchill’s remarks about British aims in World War II—“Victory at all costs, victory in spite of all terror, victory however long and hard the road may be”—are instructive. By insisting on only one final outcome, Churchill was not refusing to acknowledge that a wide range of conditions might exist. What he did was to set forth a goal that he regarded as what we would call “robust under different scenarios.” He was acknowledging the range of uncertainties (“however long and hard the road may be”), and he resisted overoptimism (which affected many bank CEOs early in the recent crisis).

A chief executive, a prime minister, or a president must provide clear and inspiring leadership. That doesn’t mean these leaders should not study and prepare for a number of possibilities. Understanding the range of likely events will embolden corporate leaders to feel prepared against most eventualities and allow those leaders to communicate a single, bold goal convincingly.

One additional point about communication and scenarios is worth noting. Scenarios can help leaders avoid looking stupid. A wide range of scenarios—even if not publicly discussed—can help prevent leaders from making statements that can be proven wrong if one of the more extreme scenarios unfolds. For instance, one financial regulator boldly announced, early in the financial crisis, that its banking system was, at the time, capitalized to a level that made it bulletproof under all reasonable scenarios—only to announce, a few months later, that a further recapitalization was required. Similarly, the head of a large bank confidently suggested that the downturn was in its final phases shortly before the major indexes plummeted by 25 percent and we entered a new and even more dangerous phase of the crisis. Many CEOs have given hostages to fortune; scenarios would have helped them avoid doing so.

Don’t rely on an excessively narrow set of outcomes

The astute reader will have noticed that the above-mentioned financial regulator managed to embarrass itself even though it was using scenarios. One of the more dangerous traps of using them is that they can induce a sense of complacency, of having all your bets covered. In this regard at least, they are not so different from the value-at-risk models that left bankers feeling that all was well with their businesses—and for the same reason. Those models typically gave bankers probabilistic projections of what would happen 99 percent of the time. This induced a false sense of security about the potentially catastrophic effects of an event with a 1 percent probability. Creating scenarios that do not cover the full range of possibilities can leave you exposed exactly when scenarios provide most comfort.

One investment bank in 2001, for instance, modeled a 5 percent revenue decline as its worst case, which proved far too optimistic given the downturn that followed. Even when constructing scenarios, it is easy to be trapped by the past. We are typically too optimistic going into a downturn and too pessimistic on the way out. No one is immune to this trap, including professional builders of scenarios and the companies that use them. When the economy is heading into a downturn, pessimistic scenarios should always be pushed beyond what feels comfortable. When the economy has entered the downturn, there is a need for scenarios that may seem unreasonably optimistic.

The breadth of a scenario set can be tested by identifying extreme events—low-probability, high-impact outcomes—from the past 30 or 40 years and seeing whether the scenario set contains anything comparable. Obviously, such an event would never be a core scenario. But businesses ought to know what they would do, say, if some more virulent strain of avian flu were to emerge or if an unexpected geopolitical conflict exploded. Remember too that it would not take a pandemic or a terrorist attack to threaten the survival of many businesses. Sudden spikes in raw-material costs, unexpected price drops, major technological breakthroughs—any of these might take down many large businesses. Companies can’t build all possible events into their scenarios and should not spend too much time on the low-probability ones. But they must be sure of surviving high-severity outcomes, so such possibilities must be identified and kept on a watch list.

Don’t chop the tails off the distribution

In our experience, when people who are running businesses are presented with a range of scenarios, they tend to choose one or two immediately to the right and left of reality as they experience it at the time. They regard the extreme scenarios as a waste because “they won’t happen” or, if they do happen, “all bets are off.” By ignoring the outer scenarios and spending their energy on moderate improvements or deteriorations from the present, leaders leave themselves exposed to dramatic changes—particularly on the downside.

So strategists must include “stretch” scenarios while acknowledging their low probability. Remember, risk and probability are not the same thing. Because the risk of an event is equal to its probability times its magnitude, a low-probability event can still be disastrous if its effects are large enough.

Don’t discard scenarios too quickly

Sometimes the most interesting and insightful scenarios are the ones that initially seem the most unlikely. This raises the question of how long companies should hold on to a scenario. Scenarios ought to be treated dynamically. Depending on the level of detail they aspire to, some might have a shelf life numbered only in months. Others may be kept and reused over a period of years. To retain some relevance, a scenario must be a living thing. Companies don’t get a scenario “right”—they keep it useful. Scenarios get better if revised over time. It is useful to add one scenario for each that is discarded; a suite of roughly the same number of scenarios should be maintained at all times.

Remember when to avoid scenarios altogether

Finally, bear in mind the one instance in which strategists will not want to use scenarios: when uncertainty is so great that they cannot be built reliably at any level of detail.2 Just as scenarios help to avoid groupthink, they can also generate a groupthink of their own. If everyone in an organization thinks the world can be categorized into four boxes on a quadrant, it may convince itself that only four outcomes or kinds of outcomes can happen. That’s very dangerous. Strategists should not think that they have all reasonable scenarios when there are quite different possibilities out there.

Don’t use a single variable

The future is multivariate, and there are elements strategists will miss. They should therefore avoid scenarios that fall on a single spectrum (“very good,” “good,” “not so good,” “very bad”). At least two variables should be used to construct scenarios—and the variables must not be dependent, or in reality there will be just one spectrum.

Some rules of thumb

Obviously, some general principles can be assembled from the points above: look for events that are certain or nearly certain to happen; make sure scenarios cover a broad range of outcomes; don’t ignore extremes; don’t discard scenarios too quickly just because short-term reality appears to refute them and never be embarrassed by a seemingly too pessimistic or optimistic scenario; understand when not enough is known to sketch out a scenario; and so on. But there are some additional rules of thumb that I have found particularly useful.

Always develop at least four scenarios

A scenario set should always contain at least four alternatives. Show three and people always pick the middle one. Four forces them to discover which way they truly lean—an important input into the discussion. Two is always too few unless there is only one big swing factor affecting the situation.
Technically, of course, many scenarios can be sketched out in almost any situation. All possible combinations of just three uncertainties will create 27 scenarios. But many of them will be impossible because the variables are rarely completely independent. Usually, the possibilities can be boiled down to four or five major possible futures.

“Crunch” the quadrants

Often people use a two-by-two matrix when presenting scenarios. But it is not routinely the case that there are just two major variables. In developing scenarios, it would be typical to identify three to five critical uncertainties. How to resolve this tension? One approach is to create multiple two-by-twos using all possible combinations of the four or five critical uncertainties. It will quickly become clear that some uncertainties are highly correlated and so can be combined—and that others are not principal drivers of the various scenarios. At minimum, this will allow for simplification. Sometimes, however, it is possible to uncover a real insight when trying to describe a quadrant created by an unusual combination of uncertainties.

There should always be a base or central case

This point goes back to the chief executive, mentioned above, who claimed that scenarios were an abdication of responsibility. It is fine to put forward scenarios—it is, in fact, the responsible thing to do. But those who must weigh scenarios and reach decisions based on them expect and deserve to get a specific point of view about the future. The scenario that is highest in probability should always be identified, and that ought to become the base case. If that proves impossible, it should at least be feasible to fashion a “central” case—but there must be crystal clarity about the degree of certainty attached to it, the alternatives, and the resilience of any strategy to those alternatives.

Scenarios must have catchy names

The notion of attaching clever names to scenarios may well sound trivial. It is not. Unless scenarios become a living part of an organization, they are useless. And if they do not have snappy, memorable names, they will not enter the organization’s lexicon. Use two to four words—no more. Plays on film titles and historical events are recommended. Some names that I have used, and that appear to have stuck, are “Groundhog Day,” “the long chill,” “perfect summer,” “end of an era,” “silver age,” and “Mexican spring.”
Avoid long, descriptive titles. No one will remember “Restrengthening world economy at a lower level of overall growth.” And avoid boring “bull, bear, and base” scenarios, even though these are used by many stock analysts. If no snappy title seems to present itself (assuming that someone creative is available), the scenario is probably too diffuse and may contain elements of two different scenarios jammed together.

Learn from being totally wrong

Developing scenarios is an art rather than a science. People learn by experience. It is useful to look back at old scenarios and ask what, in retrospect, they missed. What could have been known at the time that would have made for better scenarios? Events will prove that some scenarios were too narrow or that one was thrown out too soon. The more comfortable an organization and its people are with mistakes and learning from them, the less likely it is to be mistaken again.

Listen to contrary voices

This is a good corrective to groupthink. We tend to dismiss the mavericks. Scenarios are there to make room for them. Maverick scenarios have the virtue of being surprising, which makes people think. If a company’s scenarios are all completely predictable (conventionally good, conventionally bad, and somewhere in the middle), they are not going to be valuable. The best scenarios are built on a new insight—either something predetermined that others have missed or an unobvious but critical uncertainty.

On one occasion, when oil was at $120 a barrel, we presented a scenario with oil at $70. Someone asked what would happen if oil dropped to $10 a barrel. We said that was unnecessarily radical. But we probably should not have been so dismissive, as oil promptly fell below $50 a barrel. We should have been more open to the possibility of this radical price swing—after all, oil has been at $10 a barrel well within living memory. Scenarios should not assume a short-term time series; they should go back as far as possible. If a data series going back 300 years is available, you should consider using it (they do exist for UK interest rates and UK government debt as a percentage of GDP and these long-term data series have certainly informed current debates about the possible interest rates and sustainable debt to GDP ratios). Most variables can only be supported by data going back tens of years—but even this is much more instructive than the meager data often used and helps broaden the range of possible outcomes.


Even modest environmental changes can have enormous impact

The best example of this principle is that specialist business models fail when the business environment changes. I call this the “saber-toothed tiger” problem. The saber-toothed tiger was a specialist killing machine, its big teeth perfectly evolved to capture large mammals. When the environment changed and the large mammals became extinct, saber-toothed tigers became extinct too—those large teeth were not as good for catching small, furry mammals. By contrast, the shark is a generalist killing machine—and so has remained highly successful for hundreds of millions of years.

A specialist business model can suffer the fate of the saber-toothed tiger if the environment changes. Many winning business models are highly specialized and precisely adapted to the current business environment. Therefore no one should ever assume that today’s winners will be in an advantaged position in all possible futures (or even most of them). Therefore, scenarios should be based on creative thinking about how predicted changes in the business environment will alter the competitive landscape. If the environment changes in a scenario but the competitors remain the same, that scenario may not be imaginative enough.

None of the above is rocket science. Why, then, don’t people routinely create robust sets of scenarios, create contingency plans for each of them, watch to see which scenario is emerging, and live by it? Scenarios are in fact harder than they look—harder to conceptualize, harder to build, and uncomfortably rich in shortcomings. A good one takes time to build, and so a whole set takes a correspondingly larger investment of time and energy.

Scenarios will not provide all of the answers, but they help executives ask better questions and prepare for the unexpected. And that makes them a very valuable tool indeed.



business designbranding strategybusiness strategycustomer experienceexperience designbrandcell articlesbusinessperformancestrategy
The top 6 picks for the best business strategies of all time

Best Business Strategies #1: Tesla
Playing the Long Game

Conventional business logic is that when you're starting something new, you create a 'Minimal Viable Product' or MVP. Essentially that means that you create a version of your product that is very light in terms of functionality, but just about 'gets the job done'. It also means that the first version of your product usually has to be sold at a fairly low starting price, both to compensate for its lack of features, and to generate interest in a new launch.

Some organizations (including many tech startups) take this concept even further and launch the first version of their product completely free of charge, with a plan to 'monetize' later on once they've added more features and feel confident that people will be willing to pay money for what they're offering.

Tesla on the other hand, did things completely the other way around. It's been known for a long time that Tesla's long term goal is to be the biggest car company in the world. They know that in order to become the biggest by volume, they're going to have to kill in the lower-end consumer car space - that is cars costing less than around US$30,000 to buy.

Rather than start with this market though, and create a cheap low-featured version of their electric car to achieve scale quickly (and therefore benefit from economies of scalein addition to reaching their growth goals) - Tesla instead created the absolute most luxurious, expensive, fully-featured sports car that they could muster. That car was the Tesla Roadster, and for context, the newest generation of the Roadster will retail from upwards of US$200,000 for the base model. And this was the first car that they ever produced - knowing that they couldn't achieve the necessary scale or efficiency to turn a profit (even at such a high price).

Fast-forward to today, Tesla just recently beat General Motors in becoming the most valuable car company in the world. So their unconventional strategy certainly seems to be working, but why?

Capture-1

What can we learn from Tesla?

The first thing to note is that Tesla have in-fact made incredible progress towards their goal of mass-produced affordable electric cars. They've even made a genuine annual profit for the first time in their history. The second thing to note is that much of Tesla's business strategy was actually forced upon it. In reality there was no way that they could have created a cost-effective mass-market electric car without economies of scale. And as a startup, they weren't even close to having those economies of scale. Furthermore, because what they were building was so unique they couldn't rely on outsourcing or partnerships to gain those economies of scale.

Actually, Tesla's supply chain strategy is one of the most brilliant moves they've made. They knew early on that batteries would present not only the biggest technological hurdle to their car, but also the biggest bottleneck to production. Rather than let this derail them however, they took complete control of their supply chain by investing in factories that made batteries themselves. This had the additional benefit of allowing them to use those same batteries in parallel business ventures such as their Powerwall.

Of course, all of these strategies required vast quantities of capital and outside fundraising (Elon is rich, but not quite rich enough to fund it all himself!). And that's where the marketing genius of Tesla kicks in. Except that for the most part, their marketing efforts are only partially about the cars themselves. It's Elon Musk's personal brand that had more sway on whether or not they got the investment they needed. He's smart, divisive, wild and ambitious. But whatever you think about Elon Musk, you'd be hard pressed to traverse more than a couple of consecutive news cycles without seeing him on the front page. And that's a fantastic recipe for getting the attention of investors.


Best Business Strategies #2: AirBnb
Forgetting all about Scalability

I love the story of Airbnb. We know them today as one of the fastest growing tech companies, valued at over US$38bn, who have changed the way we travel probably forever. But did you know that they started out about as low tech as you can get?

The first Airbnb rental that ever took place, was the renting out of 3 air mattresses on the floor of co-founders Brian and Joe's apartment. They made $80 per guest. It seemed like a great idea for a startup, so they put up a website and started inviting other people to list their own mattresses for hire.

They got a few bookings here and there - but for the most part, things didn't go well. So much so, that in 2008, they resorted to selling cereal to make some extra cash.

They had plenty of listings on the site, and plenty of site traffic - but too few people were actually making bookings. They were frustrated about the lack of effort they perceived in the listings people were making. So they took matters into their own hands.

The co-founders grabbed their camera, and went to knock on the doors of each and every one of their NYC listings. When someone answered the door, they would persuade the owner to let them in, and then take a ton of photographs of the inside.They touched up the photos a bit and uploaded them to the website in place of the old photos the owners had taken. Within a month of starting this strategy - sales doubled. Then tripled. Then....well, the rest is history.

best business strategies

What can we learn from Airbnb?

The thing I love the most about this story, is that it confounds one of the most commonly stated principles of building a tech startup - that you must make everything scalable. What Brian & Joe did was anything but scalable. But it got them enough traction to prove that their concept could work. Later, they did find a way to make this solution scalable, by hiring young photographers in major locations and paying them to take professional photos of owner's listings (at no charge to the owner).


Best Business Strategies #3: Toyota
Humility can be the Best Business Strategy

In the year 1973, the 'Big Three' car makers in the USA had over 82% of the market share. Today they have less than 50%. The main reason for this, is the aggressive (and unexpected) entry of Japanese car makers, led by Toyota into the US market in the 1970's.

Cars are big, heavy and expensive to move around. That's one of the reasons why the US market was so surprised when Toyota started selling Japanese-made cars in the US, at prices far lower than they could match. The car industry was a huge contributor to the US economy, so one of the first reactions from the government was to implement protectionist taxes on all imports of cars - thus making Japanese cars as expensive as locally made cars.

But the tactic failed. Within a few years, Toyota (and by now others too) had managed to establish production plants on US soil, thus eliminating the need to pay any of the hefty new import taxes. At first, US car makers weren't all that worried. Surely by having to move production to the US, the production costs for the Japanese car makers would rise up to be roughly the same as those of the local car makers. But that didn't happen. Toyota continued to output cars (now made locally on US soil) for significantly cheaper than US companies could.

Their finely honed production processes were so efficient and lean that they were able to beat US car makers at their own game. You've probably heard of the notion of 'continuous improvement'. In the world of manufacturing, Toyota are pretty much the grandfather of exactly this.

best business strategies

What can we learn from Toyota?

Most business success stories that you read - especially in the western world, involve bold moves and against-all-odds tales of bravery. Which is what makes this particular story so unique. Toyota spent years studying the production lines of American car makers such as Ford. They knew that the US car industry was more advanced and more efficient than the Japanese one. So they waited. They studied their competitors and tried to copy what the Americans did so well. They blended these processes with the strengths of their own, and came up with something even better.

Toyota proved that knowing their own weaknesses can be the key to success - and be one of the best business strategies you can ever deploy.

Not just that. Can you name a single famous executive at Toyota? I can't. And one of the reasons is that Toyota's number one corporate value is humility. Not even the most senior plant executives have named car spaces of their own. The humility that helped them to crack the US market runs deep in the organization, from the executives to the assembly workers.


Best Business Strategies #4: HubSpot
Creating an Industry then Dominating it

HubSpot aren't as famous as Airbnb or Toyota. But, they're worth over US$2bn, and more impressively, they've achieved that valuation in an industry that didn't even exist before they invented it themselves. That industry is known as 'inbound marketing'.

Most of the marketing that we experience is known as 'interruption' marketing. This is where adverts are pushed out to you whether you like it or not. Think tv adverts, billboards, Google Adwords, etc. In 2004, HubSpot created a software platform that aimed to turn this concept of marketing on its head. The HubSpot marketing platform helped companies to write blog posts, create eBooks and share their content on social media. The theory was that if you could produce enough good quality content to pull people to your website, then just enough of them might stick around to take a look at the product you're actually selling (behind the blog).

This was a big deal. I can tell you from personal experience, that 'interruption marketing' is really really expensive. We pay Google around $10 each time someone clicks onto one of our AdWords adverts. Remember, that's $10 per click not per sale. That adds up pretty fast. On the other hand, this blog receives approaching one million clicks per year - at a cost of zero. I've written before about how inbound marketing basically saved our business - so it's fair to say that this example is pretty close to my heart!

They coined the term 'inbound marketing' - and long story short, they're now one of the biggest SaaS companies in the world. But that's not the interesting part of the story.

best business strategies

What can we learn from HubSpot?

The interesting part of the story is this: HubSpot created a new type of marketing. They then used that type of marketing to market their own company, who's sole purpose was to sell a platform that created that new type of marketing. Head hurting yet? Mine too.

In a nut-shell, HubSpot had an idea for a cool new way of marketing. Most companies would have taken that new way of marketing, and applied it to something that they were already selling. But instead, the HubSpot guys decided to monetize the marketing strategy itself. They took a whole bunch of concepts that already existed (blogging, eBooks, etc) and packaged them into a 'new way of doing things'. Not only that, but they created an awesome narrative, and then proved how powerful this new way of marketing could be, by building a $2bn business from it. They smoked their own dope, and made themselves very very rich in the process.


Best Business Strategies #5: Apple
iPhone Launch Shows Tremendous Restraint

Ok I hear you - this is such an obvious inclusion for the 'best business strategies'. But as one of the first people to adopt smartphones when they came out in the 1990's this is something else that's pretty close to my heart. I remember using Windows Mobile (the original version) on a touchscreen phone with a stylus - and it was horrible. I loved the fact that I had access to my email and my calendar on my phone. But I hated the fact that my phone was the size of a house, and required you to press the screen with ox-like strength before any kind of input would register.

Thankfully, a few years later, BlackBerry came along and started to release phones that were not only smart, but much more usable. Sony Ericsson, Nokia, HTC and a whole host of other manufacturers all came out with reasonably solid smartphones, all well before 2007 when Apple finally released the iPhone.

I remember arriving at the office one day and my boss had somehow gotten his hands on one of the first iPhones to be sold in the UK. I was shocked. Normally I was the early adopter. I was the one showing people what the future looked like. And yet, here was this guy in his mid 50's, with his thick glasses, showing off a bit of technology that I'd never even seen before.

And that is the masterstroke that is the iPhone. The reason why every single smartphone I'd ever owned had sucked in comparison to the iPhone, is because there's no real market in selling phones to geeks like me. We're too few and far between - and either too poor or too stingy to drop any real cash on new tech. Apple could easily have created a phone much earlier than it did and sold it to me. But it didn't. Instead it waited until the technology was mature enough to be able to sell to my boss. Someone who is far less tech savvy than me. But also far more financially equipped.

best business strategies

What can we learn from Apple?

The big learning here is that first mover advantage is often not an advantage. A well executed 'follower' strategy will outperform a less well executed 'first mover' strategy every single time. One of the most common misconceptions in the startup world is the concept that it's the 'idea' that matters the most. The truth is, the world's most successful companies were rarely the first ones to innovate. I'm looking at you Nokia. At you Kodak. And at you too, Yahoo.

In fact, being first is probably a disadvantage more often than it's an advantage. Why?

  • Your market isn't well defined and doesn't even know your product type exists
  • If you have a market, it's probably the early adopters - by definition, that's a niche market
  • The technology will hold you back rather than power you to success
  • Every single person that comes after you will have the advantage of learning from your mistakes

People, and especially tech companies, get carried away with being first. But you need to think very seriously about whether 'first mover' or 'smart follower' are the best business strategies for you.


Best Business Strategies #6: PayPal
Daring to Challenge the Status Quo

There are certain industries that you just don't mess with. Industries like Aerospace, big Supermarkets, Semi Conductors, and Banking. Actually, banking is probably the hardest industry of all to try to disrupt, because the barriers to entry are huge. You need mountains of capital, a ton of regulatory approval, and years of building trust with your customers around their most important asset - their cash.

Banks are old. Their business models are largely unchanged in hundreds of years, and they make huge amounts of profit, without actually making a single thing. They're insanely powerful and almost impossible to displace. But for some stupid crazy reason - PayPal didn't seem to care. I can tell you from personal experience (I worked for a bank), that the name that strikes the most fear into the executives of the banks is PayPal.

Here's why:

  1. PayPal spends less money on technology than even a medium sized bank does. Yet its technology platform is far superior.
  2. Consumers trust PayPal as much if not more than they trust their bank. Even though PayPal has been around for a fraction of the time.
  3. When a customer buys with their PayPal account, the bank has no clue what the customer actually bought. The transaction appears on the bank statement as merely 'PayPal'.That gives PayPal all the power when it comes to data mining.
  4. PayPal is quicker to market with just about any kind of payment innovation going.
  5. PayPal refuses to partner directly with banks - instead opting to partner with retailers directly.

In a very small space of time, PayPal has managed to insert itself as a whole new method of payment on the internet (and offline) - giving a very real alternative to your trusty debit or credit card. But how the heck did it manage to do it? Let's take a look at why PayPal had one of the best business strategies ever.

best business strategies

What can we learn from PayPal?

There are two huge pillars of success to PayPal's story. The first is simple - stone-cold balls. They got a fairly lucky break when they accidentally became the favored payment provider for eBay transactions. This was followed a few years later by their US$1.5bn acquisition by eBay themselves. eBay were smart enough to mostly leave them alone, and their newfound sense of boldness saw them strike a series of deals with other online retailers to try and replicate the success they'd had with eBay.

This is where the second pillar of their success comes in. Partnerships. Banks had always been wary about forming partnerships directly with retailers - instead they relied on their scheme partners (Visa / MasterCard) to do that for them. They didn't want the hassle of managing so many different relationships, and were extremely confident about the fact that credit and debit cards would always be at the heart of the financial payment system. But the problem was that MasterCard themselves were already working on a partnership with PayPal. Leaving the banks out in the cold. Today, PayPal commends an amazing 20% market share of online payments in the US - and 62.7% of the eWallet space. Almost all of that growth has come from their direct relationships with merchants large and small.

branding strategybusiness strategyconsumer trendsglobal trendscompany culturebusinessperformance
How can you today in Lebanon build a strategic plan for your company if you don’t have certainty about the future? what should Lebanese retailers, Mall owners, industrials, distributors and services providers do in the wake of the systemic shifts in the economy post-crisis?
That’s like laying the foundations of your house on a ground that might move or shift in any direction as you move towards the future.

The reality is that today every Lebanese organization is finding extreme difficulties in formulating what should be their next decision and what will the future holds.

Shall we continue to wait & see? Will our business shrink? Should we start looking into alternatives & substitutes? Which ones? What could be the legal & financial restrictions impacts? Etc.
We all normally agree that decision making should be based more on data and analysis than simple intuition and gut feelings. But there are two problems here: First, data and information will be difficult to gather as things change by the hour. Second, in the current country turmoils, previous data will tell us more about the past but gives us absolutely no indication about the future.

Make it Plausible with Scenario Planning.
Scenario Planning is not about predicting the future in a crystal ball but making assumptions on what the future is going to be and how your business environment will change overtime in light of that future. Scenario Planning aims to define your critical uncertainties and develop plausible scenarios in order to discuss the impacts and the responses to give for each one of them.

Among the many tools a manager can use for strategic planning, scenario planning stands out for its ability to capture a whole range of possibilities in rich detail. By identifying basic trends and uncertainties, management can construct a series of scenarios that will help to compensate for the usual errors in decision making — Low or overconfidence and tunnel vision.

The issue could be a narrow one: whether to make a particular investment, for example, Should a supermarket put millions into more out-of-town megastores and their attendant car parks, or should it invest in secure websites and a fleet of vans to make door-to-door deliveries?
Farmers use scenarios to predict whether the harvest will be good or bad, depending on the weather. It helps them forecast their sales but also their future investments. The scenarios that Royal Dutch/Shell used to anticipate the drop in oil prices in 1986. The scenarios a major computer manufacturer used to navigate its transition from products to services. The scenarios Xerox used to anticipate the convergence of the copier and printer or American Express used to deal with the replacement of traveler's checks by credit cards. Each organization needs its own scenarios to face its own challenges.
Other well known examples include when blue chip companies explored the end of the Berlin Wall, OPEC oil price rises, bombs and terrorist attacks. Asking the great What if? helps Identifying risk and opportunities that could arise from such events puts companies in a better situation to adapt & thrive.

So how to use scenario planning?



As you can see from the above illustration, scenario development process holds 4 critical steps. After identifying the driving forces and critical uncertainties for the months or years to come, the objectives is to develop 4 distinct scenarios that are most likely to happen. The best way to perform all of these steps is to organize workshops during which all the participants brainstorm together, it will help you find creative solutions.

The process to create scenarios is to:
  • Identify your driving forces: To start, we discuss what are going to be the big shifts in society, economics, technology and politics in the future and see how it will affect your company.
  • Identify your critical uncertainties: Once we have identified your driving forces and made it a list, pick up only two (those that have the most impact on your business). For example, two of the most important uncertainties for agribusiness companies are food prices and weather forecast. 
  • Develop a range of plausible scenarios: The goal is now to form a kind of matrix with your two critical uncertainties. Depending on what direction each of the uncertainties will take, we are able to draw four possible scenarios for the future. 
  • Discuss the implications: During this final step, we discuss the various implications and impacts of each scenario and start to reconsider your strategy: set your mission and your goals while taking into account every scenario.
It sounds simple, however, building this set of assumptions is probably the best thing you can ever do to help guide your organization in the long term.

If you're interested in learning more about how to do scenario planning, how to get alignment on your strategic plan, or learn how to lead your team through the process with our help, do contact us today!

Joe Ayoub- brandcell consulting
business designbranding strategybusiness strategycustomer servicebrandcell articlesbusinessperformancestrategy
In February I wrote an article describing how even if political stability is ensured, it will not solve the economic crisis and companies turmoil unless some radical mindset shift is operated.
Today we are in the middle of a mega multi-sided crisis (political-financial- social), the post- October 17th Lebanon will not only witness a radical shift in political, macro-economical & social aspects but also and especially in business.

Companies have to accept that that it will not be able to re-ignite their operation with a 'Business as usual' mindset. The young generation that defied the legal authorities and shook the grounds beneath a corrupt and outdated system will do the same inside the institutions where they work. They will demand transparency, equality, rights to learn & progress and be aware about the vision & purpose of their entreprise.

On the other spectrum, companies that innovate in terms of employee engagement and business models will reap unique competitive advantages. therefore, it is imperative to connect these two facets in a new social contract to liberate new energies and certainly new growth opportunities that will benefit both stakeholders.

How can that be accomplished? While businesses are in the 'wait & see' mode for political solutions, they must urgently use this time to rethink their modus operandi on all levels:

What are the opportunities to change & innovate that you would not have done in normal circumstances due to inertia and lack of time?
  1. Will your value proposition be relevant in the post-thawra time? do you need to shift your model from products-to-service-to experience or vice-versa? are the current channels to market still viable or you need to explore new more cost effective ways (digital & other)
  2. Will your Strategy stand within the new market changes? What new offerings, new customers or Customer Experience can you design & develop with the current ressources & capabilities that you acquired?
  3. How can you re-allocate your human & financial resources to support the new directions? How can you leverage your key people to play an active part in shaping the company of tomorrow? what skills they need in strategic thinking and analytics?
  4. What new partnerships you can forge to spread risks and explore new market potential?
The common answer to all the above is INNOVATION. Not in terms of technology or invention as some might think of it but in terms accepting and applying new mindset, methods, tools & approach to solve such problems that this crisis unleashed upon the country. Traditional thinking & solutions will simply fail to address these wicked challenges.

The new solutions will have to be designed around:
  • Empathy for employees and customers
  • Co-created with employees and customers
  • Prototyped to fail quickly & learn fast
  • Implemented with utmost engagement and with appropriate systems & procedures.
The good news is that you are not alone. You can always get the help of experts and we at Brandcell amongst others have been helping progressive companies to thrive in difficult & unpredictable times by showing what strategy & innovation can do to unlock new growth so that times of troubles are turned into opportunities.


Joe Ayoub- Brandcell consulting
innovationbusiness designbrandcell newsbrandingbranding strategybusiness strategytipsbrandcell articles
For innovative businesses, one of the crucial roles that data plays is proving to a sometimes sceptical audience that your product provides a new solution to a recurrent problem.
You know that your idea will change the world – but gathering facts and figures to convince other people is much simpler when you have a thorough data strategy in place.

At this point in the digital age, acting on “gut instinct” when it comes to making operational decisions are long gone. Today all elements of a business’s operations – design, production, distribution, marketing, customer services – can be monitored, measured and analyzed.

This means that businesses which have engaged with the processes of digital transformation will have facts and figures on hand to get across not just what they do, but why (and how) they do it more effectively than anyone else. If you are innovating, this is the essence of the idea that you have to “sell”, to position yourself as a market leader.

One business I have recently come across with an innovative – potentially world-changing –product  is the UK food technology company It’s Fresh!. In a world where millions go starving despite one third of the food we produce going to waste, they claim their packaging product can reduce waste by 45% - and they have the data to prove it.
innovationbusiness designbrandingbusiness strategybrandcell articlescompany cultureBusiness Model Innovation
Just how do major organizations use data and analytics to inform strategic and operational decisions? Senior leaders provide insight into the challenges and opportunities.
Few dispute that organizations have more data than ever at their disposal. But actually deriving meaningful insights from that data—and converting knowledge into action—is easier said than done. We spoke with six senior leaders from major organizations and asked them about the challenges and opportunities involved in adopting advanced analytics: Murli Buluswar, chief science officer at AIG; Vince Campisi, chief information officer at GE Software; Ash Gupta, chief risk officer at American Express; Zoher Karu, vice president of global customer optimization and data at eBay; Victor Nilson, senior vice president of big data at AT&T; and Ruben Sigala, chief analytics officer at Caesars Entertainment. An edited transcript of their comments follows.


Challenges organizations face in adopting analytics

Murli Buluswar, chief science officer, AIG: The biggest challenge of making the evolution from a knowing culture to a learning culture—from a culture that largely depends on heuristics in decision making to a culture that is much more objective and data driven and embraces the power of data and technology—is really not the cost. Initially, it largely ends up being imagination and inertia.

What I have learned in my last few years is that the power of fear is quite tremendous in evolving oneself to think and act differently today, and to ask questions today that we weren’t asking about our roles before. And it’s that mind-set change—from an expert-based mind-set to one that is much more dynamic and much more learning oriented, as opposed to a fixed mind-set—that I think is fundamental to the sustainable health of any company, large, small, or medium.

Ruben Sigala, chief analytics officer, Caesars Entertainment: What we found challenging, and what I find in my discussions with a lot of my counterparts that is still a challenge, is finding the set of tools that enable organizations to efficiently generate value through the process. I hear about individual wins in certain applications, but having a more sort of cohesive ecosystem in which this is fully integrated is something that I think we are all struggling with, in part because it’s still very early days. Although we’ve been talking about it seemingly quite a bit over the past few years, the technology is still changing; the sources are still evolving.

Zoher Karu, vice president, global customer optimization and data, eBay: One of the biggest challenges is around data privacy and what is shared versus what is not shared. And my perspective on that is consumers are willing to share if there’s value returned. One-way sharing is not going to fly anymore. So how do we protect and how do we harness that information and become a partner with our consumers rather than kind of just a vendor for them?


Capturing impact from analytics

Ruben Sigala: You have to start with the charter of the organization. You have to be very specific about the aim of the function within the organization and how it’s intended to interact with the broader business. There are some organizations that start with a fairly focused view around support on traditional functions like marketing, pricing, and other specific areas. And then there are other organizations that take a much broader view of the business. I think you have to define that element first.

That helps best inform the appropriate structure, the forums, and then ultimately it sets the more granular levels of operation such as training, recruitment, and so forth. But alignment around how you’re going to drive the business and the way you’re going to interact with the broader organization is absolutely critical. From there, everything else should fall in line. That’s how we started with our path.

Vince Campisi, chief information officer, GE Software: One of the things we’ve learned is when we start and focus on an outcome, it’s a great way to deliver value quickly and get people excited about the opportunity. And it’s taken us to places we haven’t expected to go before. So we may go after a particular outcome and try and organize a data set to accomplish that outcome. Once you do that, people start to bring other sources of data and other things that they want to connect. And it really takes you in a place where you go after a next outcome that you didn’t anticipate going after before. You have to be willing to be a little agile and fluid in how you think about things. But if you start with one outcome and deliver it, you’ll be surprised as to where it takes you next.

Ash Gupta, chief risk officer, American Express: The first change we had to make was just to make our data of higher quality. We have a lot of data, and sometimes we just weren’t using that data and we weren’t paying as much attention to its quality as we now need to. That was, one, to make sure that the data has the right lineage, that the data has the right permissible purpose to serve the customers. This, in my mind, is a journey. We made good progress and we expect to continue to make this progress across our system.

The second area is working with our people and making certain that we are centralizing some aspects of our business. We are centralizing our capabilities and we are democratizing its use. I think the other aspect is that we recognize as a team and as a company that we ourselves do not have sufficient skills, and we require collaboration across all sorts of entities outside of American Express. This collaboration comes from technology innovators, it comes from data providers, it comes from analytical companies. We need to put a full package together for our business colleagues and partners so that it’s a convincing argument that we are developing things together, that we are colearning, and that we are building on top of each other.


Examples of impact

Victor Nilson, senior vice president, big data, AT&T: We always start with the customer experience. That’s what matters most. In our customer care centers now, we have a large number of very complex products. Even the simple products sometimes have very complex potential problems or solutions, so the workflow is very complex. So how do we simplify the process for both the customer-care agent and the customer at the same time, whenever there’s an interaction?

We’ve used big data techniques to analyze all the different permutations to augment that experience to more quickly resolve or enhance a particular situation. We take the complexity out and turn it into something simple and actionable. Simultaneously, we can then analyze that data and then go back and say, “Are we optimizing the network proactively in this particular case?” So, we take the optimization not only for the customer care but also for the network, and then tie that together as well.

Vince Campisi: I’ll give you one internal perspective and one external perspective. One is we are doing a lot in what we call enabling a digital thread—how you can connect innovation through engineering, manufacturing, and all the way out to servicing a product. [For more on the company’s “digital thread” approach, see “GE’s Jeff Immelt on digitizing in the industrial space.”] And, within that, we’ve got a focus around brilliant factory. So, take driving supply-chain optimization as an example. We’ve been able to take over 60 different silos of information related to direct-material purchasing, leverage analytics to look at new relationships, and use machine learning to identify tremendous amounts of efficiency in how we procure direct materials that go into our product.

An external example is how we leverage analytics to really make assets perform better. We call it asset performance management. And we’re starting to enable digital industries, like a digital wind farm, where you can leverage analytics to help the machines optimize themselves. So you can help a power-generating provider who uses the same wind that’s come through and, by having the turbines pitch themselves properly and understand how they can optimize that level of wind, we’ve demonstrated the ability to produce up to 10 percent more production of energy off the same amount of wind. It’s an example of using analytics to help a customer generate more yield and more productivity out of their existing capital investment.


Winning the talent war

Ruben Sigala: Competition for analytical talent is extreme. And preserving and maintaining a base of talent within an organization is difficult, particularly if you view this as a core competency. What we’ve focused on mostly is developing a platform that speaks to what we think is a value proposition that is important to the individuals who are looking to begin a career or to sustain a career within this field.

When we talk about the value proposition, we use terms like having an opportunity to truly affect the outcomes of the business, to have a wide range of analytical exercises that you’ll be challenged with on a regular basis. But, by and large, to be part of an organization that views this as a critical part of how it competes in the marketplace—and then to execute against that regularly. In part, and to do that well, you have to have good training programs, you have to have very specific forms of interaction with the senior team. And you also have to be a part of the organization that actually drives the strategy for the company.
Murli Buluswar: I have found that focusing on the fundamentals of why science was created, what our aspirations are, and how being part of this team will shape the professional evolution of the team members has been pretty profound in attracting the caliber of talent that we care about. And then, of course, comes the even harder part of living that promise on a day-in, day-out basis.

Yes, money is important. My philosophy on money is I want to be in the 75th percentile range; I don’t want to be in the 99th percentile. Because no matter where you are, most people—especially people in the data-science function—have the ability to get a 20 to 30 percent increase in their compensation, should they choose to make a move. My intent is not to try and reduce that gap. My intent is to create an environment and a culture where they see that they’re learning; they see that they’re working on problems that have a broader impact on the company, on the industry, and, through that, on society; and they’re part of a vibrant team that is inspired by why it exists and how it defines success. Focusing on that, to me, is an absolutely critical enabler to attracting the caliber of talent that I need and, for that matter, anyone else would need.


Developing the right expertise

Victor Nilson: Talent is everything, right? You have to have the data, and, clearly, AT&T has a rich wealth of data. But without talent, it’s meaningless. Talent is the differentiator. The right talent will go find the right technologies; the right talent will go solve the problems out there.

We’ve helped contribute in part to the development of many of the new technologies that are emerging in the open-source community. We have the legacy advanced techniques from the labs, we have the emerging Silicon Valley. But we also have mainstream talent across the country, where we have very advanced engineers, we have managers of all levels, and we want to develop their talent even further.

So we’ve delivered over 50,000 big data related training courses just this year alone. And we’re continuing to move forward on that. It’s a whole continuum. It might be just a one-week boot camp, or it might be advanced, PhD-level data science. But we want to continue to develop that talent for those who have the aptitude and interest in it. We want to make sure that they can develop their skills and then tie that together with the tools to maximize their productivity.

Zoher Karu: Talent is critical along any data and analytics journey. And analytics talent by itself is no longer sufficient, in my opinion. We cannot have people with singular skills. And the way I build out my organization is I look for people with a major and a minor. You can major in analytics, but you can minor in marketing strategy. Because if you don’t have a minor, how are you going to communicate with other parts of the organization? Otherwise, the pure data scientist will not be able to talk to the database administrator, who will not be able to talk to the market-research person, who which will not be able to talk to the email-channel owner, for example. You need to make sound business decisions, based on analytics, that can scale.
innovationbusiness designcompany cultureperformancestrategy
The world is advancing at a breakneck pace on many fronts, especially when it comes to technology, innovation, and modern experience. We’ve gone from largely offline, one-on-one consumer experiences through desktop platforms to highly personalized, contextually relevant mobile and adaptive ones.
But deploying big data and AI — or machine learning — collectively is about more than just making sense of data: it’s about putting it to use. Companies can leverage the actionable intel they gain through advanced metrics to build better campaigns, make more informed decisions and even predict customer behavior. In advertising and marketing, for instance, big data and AI can help make ad copy more profitable. By aligning content with the five components of successful copy and automating its delivery, you can ensure it has a widespread and optimal impact. Thanks to the gig economy, companies are also now able to hire data scientists online, from across borders.

Just to show you a little of the power behind these technologies, we’re going to take a closer look at some companies and brands using such platforms to improve performance and efficiency and deliver better customer experiences. Here are 5 real-world examples of companies using big data and AI to boost sales, deliver personalized experiences and improve their products.


1. Starbucks

The obvious — and often overhyped —  examples are Amazon, Walmart, and other major retailers. But such use-cases are low-hanging fruit. The reality is, many brands you might not expect are using AI and big data — like Starbucks, for instance.

Personalization is highly valuable to consumers in the modern day and age, as it means faster service, more relevant options, and better all-around experiences. Big data and customer metrics, including real-time information, have made it possible to deliver more targeted service options. Starbucks is at the forefront of this, using their mobile app and vast data stores to display preferred orders to baristas before customers even get to the counter. It also improves performance considerably, speeding up order and service times, especially during the busiest hours.

How does it work? Members of the Starbucks rewards program and mobile app often use it to order drinks, call in future orders and take advantage of exclusive benefits. At the same time, the company uses this service to gather a lot of information about their customers’ habits and buying preferences. That is precisely how they can provide preferred order information to baristas.

But the company also uses this information to build more relevant marketing campaigns and promotions, decide locations for new stores or potential business and even decide future menu updates.


2. Burberry

Burberry, a prominent British fashion brand, is also using big data and AI to boost performance, sales and customer satisfaction.

Naturally, their customers make use of loyalty and rewards programs through a mobile app. For those actively using such services, Burberry asks them to share data and uses the information they gather to deliver relevant recommendations for both online and in-store products.

Most interesting is how this translates into the conventional brick-and-mortar Burberry stores. Sales assistants and company reps have access to company-owned tablets that provide buying suggestions and additional information about select customers. Employees can see a customer’s purchase history, their preferences and even social media activity. They can use this data to provide a more personalized experience, which can help boost sales.

For example, let’s say you buy a blouse online. When you visit the store, an employee can see this purchase and recommend matching handbags or accessories. They can even suggest items other consumers have bought alongside the same blouse.

Taking this concept of knowledge and digital information in a different direction, all products in Burberry stores have unique RFID tags. When shoppers visit a store, a mobile app experience will communicate with them directly about various goods. They can see where products came from, or even get tips on how to style them. It’s an incredible merger of digital and physical engagement that improves their service and response to customer needs.


3. McDonald’s

The world-famous fast-food joint McDonald’s is embracing modern technology in many ways, including using big data and AI.

Their updated mobile app allows customers to order and pay almost entirely via their mobile devices. To make the experience that much more enjoyable, they gain access to exclusive deals, too. In return for the convenience, McDonald’s collects essential information about their audience.

They can see what foods and services customers order, how often or even whether they visit the drive-thru or go inside. All this data allows for more targeted promotions and offers. In fact, Japanese customers using the company’s mobile app spend an average of 35 percent more because of spot-on recommendations just before they are ready to order food.


4. Spotify

Spotify is not unlike Netflix in how it uses AI and big data to deliver better playlists and streaming content recommendations to its users. The Discover Weekly feature is an excellent example of this in action. Each week, Spotify offers every user a personalized playlist with music recommendations based on their listening and browsing history. It’s kind of like a curated mixtape from the platform, offering new tracks and artists, showing you new genres you might enjoy or even updating you on your favorite music.

This feature is possible thanks to a vast trove of information and data they collect from their user base. When you have millions of people listening to music every day, you gain some pretty deep insights into user habits and preferences.

The company has also launched a “Spotify for Artists” app that lets bands and music artists see analytics related to their content.


5. The North Face

If you’re not familiar with The North Face, they are a prominent clothing vendor that offers both outdoor-friendly and active fashions. They’ve tapped into artificial intelligence and machine learning — thanks to IBM’s Watson — to deliver a highly personalized customer experience, all delivered via a mobile app.

Upon download, customers can speak directly to their phone to engage with Watson. The system then works just like a human salesperson, in that it walks them through various questions and shopping experiences and then delivers custom recommendations. The answers you provide during the initial phase and how you react help shape the system’s future interactions with you.

For example, one question might be, “What features do you want in your jacket?” Your response will determine the products and goods Watson recommends to you.

Machine Learning and AI Platforms Are Helping Shape the Modern Experience
In many ways, these technologies will improve performance and efficiency for business while simultaneously modernizing experiences for consumers. Just consider the myriad ways in which you can now receive highly personalized and contextually relevant content or recommendations, based on something as simple as your recent purchase history.

This information can improve a plethora of business-centric strategies, too, such as marketing and advertising, partner relations and future decisions. It’s hard to believe, but the future we’ve seen portrayed in sci-fi movies — where bots and technology permeate our daily lives — is here.
business strategycustomer experienceexperience designdigital strategycustomer serviceconsumer brandsconsumer trendsglobal trendscompany culturestrategy
It’s time to take today’s technological threats seriously and change the way you do business.
If you haven’t noticed, a high-stakes global game of digital disruption is currently under way. It is fueled by the latest wave of technology: advances in artificial intelligence, data analytics, robotics, the Internet of Things, and new software-enabled industrial platforms that incorporate all these technologies and more. Every enterprise leader recognizes that, as a result, the prevailing business models in his or her industry could drastically and fundamentally change. A wide range of industries, such as entertainment and media, military contracting, and grocery retail have already been profoundly affected. No enterprise, including yours, can afford to ignore the threat. Yet most companies are still not moving fast enough to meet this change. Some leaders are still in denial about it, some are reluctant to upend the status quo in their companies, and some are unaware of the necessary steps to take. But these excuses are not good enough.

If your company is aleady struggling, then digital disruption will accentuate your problems. You may not have needed a plan for the new digital age yet, if only because it didn’t seem relevant to your industry. But you will need it now. Otherwise, no matter how well you run your business, it will not produce results at a scale that will allow you to compete. The companies with a clearly differentiated identity — those that stand apart from the crowd — are in the best position to thrive. For every company, this is an immense opportunity to rethink every aspect of the business, and chart a bold path for success.

Disruption, by our definition, means a shift in relative profitability from one prevailing business model to another. The dominant companies, accustomed to the old approach, lose market share to a new group of companies. Not every disruption is driven by advances in technology, but this one is. And because the software fueling this transformation can be applicable across traditional industry and business function boundaries, competitors can emerge from seemingly anywhere. In sector after sector, new entrants are lowering prices, meeting consumer needs in novel ways, making better use of underutilized assets, and hiring people with broadly relevant digital skills, who have collaborative, creative, and efficient work styles.

If you’re skeptical about this, it’s probably because you’ve seen digital technology appear before, without much of an effect on your core business. Even industries that feel pressure will not be completely trransformed. No matter how many people order their paper towels and canned soup online, for example, there will continue to be some brick-and-mortar grocers.

But the wave of disruption that’s cresting now is more comprehensive and far-reaching than any previous wave. Consider what has already happened to less physically based industries, such as media and entertainment. They have had to rework their business models, seeking revenue through social media and new forms of consumer engagement. Industrial and manufacturing companies are following a similar path: embedding logistics systems with sensors, linking supply chains with shared data and robotics, opening the door to innovations in energy and materials, and changing the way that every product is made and delivered.

Your shareholders (particularly activist shareholders), customers, and employees expect you to respond quickly. But panic and full-bore opportunism, in which you pursue every seeming source of revenue, will not work either. The answer is to develop a coherent strategy, seeking out the options that fit best with what you already do well. Here are 10 principles for accomplishing this, drawn from the experience of companies that have done so.


Recognizing the Change

1. Embrace the new logic.
When you first hear about a new digitally enabled competitor, you may tell yourself that company can’t succeed. It’s operating in a narrow niche, and it won’t be profitable at scale. Hundreds of executives of established companies have made this mistake, dismissing such innovations as the photocopier, steel mini-mill, graphical user interface, smartphone-embedded camera, and video streaming service. Instead, view each upstart competitor as a company you can learn from.

There’s always logic behind a new entrant’s business model, a reason it is being introduced. It meets customer needs more effectively than you do (see principle number 4), offers consistently lower prices (principle number 5), or makes better use of assets (principle number 6). Chances are, it does all three. For example, Zume, which makes pizza to order in its oven- and robot-equipped trucks, delivers fresh, inexpensive food to people’s homes rapidly. As of October 2017, it had raised more than US$70 million in venture capital. Although no one can predict whether Zume or another contender will succeed, the general logic of vehicle-based fast-food represents a major threat to low-cost restaurant chains. The very existence of potential disruptors in your industry — especially if they are funded by venture capital — is a sign that your business model is regarded as obsolete. It’s up to you to figure out why, and how you can change it.

In addition to studying your new competitors’ logic, look closely at the assumptions embedded in your company’s current business model. Keep in mind what you know digital technology can do for you. How could you redesign your capabilities to deliver better value than your competitors can? What aspects of your business model could you change to deliver better value, on a grand scale, than any upstart could? What would you have to do differently to make your own disruption work?

Best Buy went through a thought process much like this, and became one of the very few specialty retailers to compete successfully against online retailers such as Amazon. Among the disruptive factors it had to deal with, as New York Times reporter Kevin Roose put it, was “showrooming: customers were testing new products in stores before buying them for less money online from another retailer.” Best Buy chose to disrupt its own business model with a price-matching guarantee, a renewed emphasis on customer consultations (building on its “Geek Squad” experience), new workforce policies to gain a more skilled and loyal employee base, and improved logistics that integrated its online and in-person experiences. (In effect, manufacturers now pay to be included in Best Buy’s “showrooming” array.) These elements added up to a powerful new approach for Best Buy that raised its stock price more than 50 percent in 12 months.

2. Start now, move deliberately.
You have to balance moving reactively and acting strategically when the signs of pending disruption first appear for your industry. “We always overestimate the change that will occur in the next two years,” wrote Bill Gates in his 1995 book The Road Ahead. “And [we] underestimate the change that will occur in the next 10. Don’t let yourself be lulled into inaction.”

To be sure, it may take a year or more for customers to change their habits at a scale that affects you financially. During this period, you are still relying on your old business model for earnings. But if you don’t start visibly taking steps to change that business model right away, it could affect your company’s market value. Investors are gauging your effectiveness based on their perceptions of the digital threat approaching your industry. If they consider you unprepared, they will have reason to pounce.

At the same time, you have to proceed deliberately and strategically, rather than frantically and reactively. Panic is contagious. You are not looking for quick opportunities — you are plotting the new trajectory of your company. Use this time to develop your own sustainable, digitally enabled value proposition, to build out your own distinctive capabilities, and to sell off or shut down the assets you will no longer need when the disruption fully takes hold.

Be bold and openly declare your intentions. Make it clear to your constituents — not just investors, but employees, suppliers, distributors, and other members of your business ecosystem — that you are preparing your own disruptive innovations. Continually reevaluate and refine your new approach, adjusting it to reflect changes in customer behavior and in your industry. Prototype new products and services and take them to market quickly, testing them with real customers. Bring the best ideas to scale.

When your industry’s changes finally reach a tipping point, it will seem sudden to everyone else. But you’ll know better. Because of your early start, you’ll be ready with the capabilities you need. You can then move fast, seize the advantage, and lead your sector.

Amazon has provided an example of this approach since the 1990s. Starting with books, then branching into other types of retail, and ultimately moving into general logistics and cloud-based computer services, it always had the same game plan: to expand gradually, taking on challenges when it was equipped to do so. It took Amazon 20 years to build up the requisite capabilities to master grocery delivery, an extraordinarily difficult challenge because fresh food can easily spoil. By contrast, Webvan, which also began in the late 1990s, started out with a home food delivery concept, overextended itself trying to cover the then-too-expensive “last mile” to the customer’s door, and went bankrupt.


Building Your Identity

3. Focus on your right to win.

A right to win is the ability to meet challenge after challenge with a reasonable likelihood of success. Instead of relying on a single product or service to define your business, develop a strong identity — a recognizable expression of what your enterprise does well and why it matters — that makes your company truly distinct. Don’t abandon your old business model entirely; build on your existing strengths. In many disrupted industries, the new and old business models continue to coexist: Brick-and-mortar groceries will not go away entirely, just as bric-and-mortar bookstores have not. Combine those core capabilities to create one consistent approach that applies to everything you do. Like Amazon, Apple, IKEA, Starbucks, or other iconic companies, you will send a strong, steady signal of who you are and what customers can expect from you. Or as Harvard Business School professor Clayton M. Christensen, who developed today’s prevailing concept of disruption, put it: “Decide what you stand for, and then stand for it all the time.”

One company that has gained a right to win is PetSmart, a retailer of pet products and services. In April 2017, PetSmart made the largest e-commerce acquisition in history. It acquired Chewy.com, a pet supply site, for $3.35 billion — just a bit more than Walmart paid for the online store Jet.com around the same time. Chewy provided customer service capabilities that complemented PetSmart’s extensive retail store network and its multiple services (such as boarding hotels, grooming salons, and walk-in pet clinics). Chewy offered a high level of customer interaction, comparable to that of premium retailers such as Nordstrom. The company calls customers proactively to address service problems, and sends cards to thank people for their business. These combined capabilities give PetSmart and Chewy a much clearer identity and way to compete.

You gain your right to win by building and maintaining a system of distinctive cross-functional capabilities — combinations of people, knowledge, IT, tools, structures, and processes, refined and developed over time. To preeminent business historian Alfred D. Chandler Jr., this “integrated learning base” was the single most important factor for business success. You already have some of those capabilities, or you wouldn’t have gotten this far, but you may need to develop or acquire others, as PetSmart did. Orient your business around those key capabilities. Make long-term investments to support them, and divest businesses that don’t fit.

Another prominent example is Honeywell. In the mid-2010s, its right to win enabled Honeywell’s heating, ventilation, and air conditioning (HVAC) business to beat back a disruptive threat from Nest and other digital thermostats. Honeywell had a strong distribution capability; its people knew how to maintain strong relationships with HVAC installers and contractors, who referred customers to Honeywell’s digital thermostats instead of those from the startup. This gave the company time to bring its technology up to date.

4. Create your customers’ future.
What does your customers’ future look like? Think about meeting their needs in a more fundamental way, so that they continually want more contact with your company and its offerings. Your mission, as Steve Jobs told his biographer Walter Isaacson, “is to figure out what they’re going to want before they do.” This will require imagination and insight; they won’t be able to articulate it if you ask them. Creating your customers’ future may require an obsessive focus on them. Make their problems go away. Remove the friction in their lives. Make things easier and less complex, while reducing the price they have to pay.

The most effective consumer-oriented companies rely on privileged access to their customers. For example, IKEA has an extensive program for sending executives to the homes of customers, who welcome them because the company has enhanced their daily life. You can also learn a great deal from co-creating your products with customers, involving them in design and development. Adobe Systems, for example, routinely consults with graphics professionals in designing new packages for them. Google and Facebook had a huge advantage in the large number of sophisticated early adopters in their own workforce. The companies continually sampled their employees’ reactions and adapted their offerings accordingly.

As marketing experts have pointed out since at least 1960, when Theodore Levitt’s groundbreaking Harvard Business Review article “Marketing Myopia” was published, customers are most compelled by outcomes: the results your products and services deliver, rather than the products and services themselves. This was how Philips profited from its halogen bulbs, the kind that retailers install in parking lots. Concerned about losing out to makers of lower-priced commodity bulbs, Philips set up a service to change the bulbs when they burned out, and continued its R&D on longer-life bulbs so the costs of that service would go down. Similarly, GE’s aircraft engines, Daimler’s trucks, Tesla’s electric cars, and Siemens’s power systems are all embedded with sensors, designed to provide analytics about not just the machines’ behavior (for better maintenance) but what the customer (the airline, truck driver, or power utility) is doing day after day, and how that experience might be improved.

5. Price to drive demand.
Nearly every significant disruption reduces costs in some way. Customers respond more powerfully to cost reduction than to other types of increases in value. When you set your prices low, you attract customers, scale up your new business model, and force changes that make it more difficult for rivals to compete.

Even high-profile disruptive competitors do not dramatically affect the rest of the industry until they become competitive in price. For example, it was only with its launch of the “affordable” $35,000 Model 3 in 2017 that Tesla began to compete with a wide range of other automakers. For most products and services, it’s best to build your response to disruption by lowering costs and looking for a larger customer base. Often this means using digital technology in inventive ways. Sometimes, as with Amazon and Uber, it involves pricing at a loss for the sake of long-term scalability and market share.

Undoubtedly, you are already diligent about reducing costs. But you may not have gotten in the habit of strategic pricing: cutting costs to drive up demand. A notable example is IKEA, which builds a 1.5 to 2 percent product price reduction into its budget planning every year, as a forcing function. This requires its planners to figure out how to reduce costs significantly, and it has created the kind of customer loyalty that no disruptor can dislodge.

6. Profit from overlooked assets.
Many digital disruptions take advantage of assets that have been underutilized. This approach is feasible because of the way digital technology reduces friction and reveals options. The sharing economy businesses that sell access to unused time in privately owned automobiles, production plants, homes, and office spaces changed their industries by monetizing their assets’ previously unused capacity.

You, too, can disrupt your industry, by identifying ways to create value from underused assets. These may be found anywhere in your business. With a cloud computing installation, you may make more effective use of your computer processing power — and your programmers’ time. Or consider the stockroom of a big-box store. The space is big because of the scaling factor of labor. Once you have paid for the cost of putting in one pallet, putting in the next four is quite cheap. Because digital interoperability makes it easier to process multiple materials and products from multiple vendors, why not share back rooms and warehouse staff?

Overlooked assets don’t have to be physical. They can include proprietary information, continually gathered data, or specialized expertise. For example, the Aravind Eye Hospital in India is one of the most effective cataract treatment centers in the world. It values professional expertise as a specialized asset. Each surgeon treats 10 times as many cataract patients per day, on average, as a similar surgeon would in the United States. The hospital, whose processes were modeled after those of McDonald’s, uses every means possible to focus a skilled surgeon’s time where it matters most: on the cataract operation. Everything else, including administrative work and referrals of complex cases, is handled by someone else.

It may take time to develop a compelling and profitable approach to your assets. The first shared office space enterprises emerged in the early 2000s, but it wasn't until the mid-2010s that companies such as WeWork landed on a format and package that brought the concept mainstream. While you are developing your own approach, consider divesting the assets that hold you back or require ongoing costs. Every asset you own should contribute to, or benefit from, your differentiating capabilities.

7. Control your part of the platform.
Disruptive companies don’t do everything themselves. They rely on the capabilities provided by others. Those capabilities will be more widely available as vast business-to-business platforms emerge: platforms such as Amazon Web Services, GE’s Predix, Siemens’s MindSphere, and the emerging Chinese “Belt and Road” system. A platform is a group of interoperable technologies that provide a basic infrastructure into which applications and processes from a host of companies can fit, working together seamlessly. The new digital platforms will help transform enterprises in the same way that their online predecessors, such as Google, Facebook, and Amazon, helped change consumer habits. A platform provides access to others on the platform, new ways of creating value from digital assets, and a much greater scale at minimal cost. Just as it’s vital to know what your company is best at, it’s critical to know where you can rely on others’ technology and solutions.

Some companies thrive by becoming platform providers. Salesforce, for example, has used its capabilities in developing software-as-a-service and other cloud-based offerings to build an open ecosystem for sales and customer relationship management that gives the company a distinctive competitive advantage. By incorporating independent developers, system integrators, and consultants into the Salesforce ecosystem, the company has become a hub for a vast number of innovative businesses in multiple sectors, giving Salesforce unique access to information and leading trends.

But you don’t have to own platforms to profit from them. Instead, focus on a part of the platform that gives you a right to win and establishes stable standards for an entire ecosystem. For example, if you are one of many component manufacturers for, say, servers or home-control devices, or one of many developers of similar software apps, you may lose value. But if you carve out a distinctive identity and role within other companies’ ecosystems, you can still draw value to you. You can be like Corning, manufacturing the Gorilla Glass used in the iPhone, along with many other kinds of specialty glass used for automobiles and other smartphones; or like HCL Technologies, which has parlayed its distinctive R&D and consultation capabilities into a refined outsourced technology business serving other high-tech companies.

Because digital technology blurs boundaries among industries, you should use platforms to break free of the constraints of your sector. It is no longer necessary to manage your own supply chain to connect with suppliers and distributors. Apple, famously, is in music and video streaming, information technology hardware and software, Internet services, telephony, timepieces, digital photography, and retail. It is number one in most of those businesses. It doesn’t matter anymore what sector you think Apple is in; Apple is number one at being Apple. It has consolidated its market around one distinct identity.

Choose carefully the platforms you join. Once you are intertwined with them, there may be enormous switching costs if you need to change. Protect your control over your customer data, intellectual property, and distinctive capabilities system.

There may still be an advantage to integrating vertically; as Inditex (Zara), Amazon, and Haier have discovered, it can provide opportunities for differentiating your company. But the best option is to make a more fine-grained assessment of your costs and customers, and design your mix of vertical and horizontal activity accordingly.


Bringing Your Future to Life

8. Integrate, don’t isolate.
The perception that disruption is imminent has many executives scrambling to launch digital side projects in the form of programs, products, and services that can stand on their own. There are many evocative nicknames for these mini-enterprises and isolated projects: Skunkworks. Pirate ships. Special forces. Labs. Quarantined units. The names convey the problem: a basic lack of connection between this subscale unit of activity and the core enterprise.

To be sure, “pirate ships” have more freedom than the rest of the enterprise. They avoid the usual restrictions and requirements, the cultural antibodies that hamper creativity. They can even generate innovative products and services that seem to be the wave of the future. But because they are not integrated with the rest of the company, they don’t have the capabilities or support they need to be sustainable. Nor does the core business learn from them or benefit from their capabilities. Even if it succeeds in a narrow context, a pirate ship dissipates resources and makes it more difficult to go to scale with a new digitally enabled business model. In the end, transformation doesn’t happen in silos; it requires an enterprise-wide digital effort.
business designbranding strategybusiness strategydigital strategycustomer servicecompany culture
Dembracing digital transformation is key to survival in today's business world. Find out how these companies succeeded where others failed.
Bon-Ton, Radioshack, Toys "R" Us, IHeartMedia--these are just a few of the companies that filed for chapter 11 in the past year. Both the retail industry and media industry have struggled to keep pace with our evolving digital world, but many other industries are facing similar challenges.

However, where some companies are failing, others are making tremendous strides forward. There are many traditionally based businesses--companies that have been operating well before the Digital Age changed everything--that have embraced digital transformation with open arms. These companies have incorporated omni-channel shopping experiences, invested in IoT sensors, leveraged data analyzation, and more. Their leadership is not afraid to shake up the status quo while keeping a keen eye on future tech and trends. So, even though entire industries may be facing disruption on many fronts, these companies have found a way to beat the competition and continue delighting their customers.

Here are just a few examples of companies that have successfully leveraged digital strategies to thrive in today's hyper-competitive markets:

New York Times
Twenty years ago, if you hopped on the subway during rush hour in Manhattan, you'd be surrounded by people with their noses buried in newspapers. Today, however, everyone's attention is glued to their phones instead.

Digital has been killing the media industry--particularly publishing and newspapers--for over 15 years now. According to The Atlantic, "Between 2000 and 2015, print newspaper advertising revenue fell from about $60 billion to about $20 billion, wiping out the gains of the previous 50 years."

But one newspaper managed to navigate these turbulent waters by embracing digital. The New York Times decided to implement a successful subscription model for their online content that allowed the company to continue to deliver the same type of high-quality journalism and content their readers trusted for over 167 years. They don't rely on ads or clicks so they can make content decisions based on journalism principles instead of the advertiser's demands.

This method appears to be working. According to their January 2017 report, "Last year, The Times brought in almost $500 million in purely digital revenue, which is far more than the digital revenues reported by many other leading publications (including BuzzFeed, The Guardian and The Washington Post) -- combined."

Fidelity
Founded in 1946, Fidelity has come a long way when it comes to digital transformation. While many other companies in the financial industry have struggled to compete with fintech startups, this multinational financial services corporation has been betting big on digital and it shows.

The mobile app, in particular, is one of Fidelity's shining achievements. With a current rating of 4.7 stars and a half a million reviews on Apple, it's safe to say customers are happy with the Fidelity app experience. One of the biggest wins is that this company managed to successfully mimic the desktop trading experience in the app--allowing customers to make trades and invest on the go.

Disney Parks
While Disney is definitely not a princess that needed to be saved, it's important to make note of their impressive digital transformation efforts.


In 2015, Disney Parks announced it would be investing $1 billion in IoT sensors to be used throughout their parks. Today, guests who attend Disney World get a MagicBand wristband that uses RFID technology to make their time in the park seem even more magical. These bands act as payment, hotel room keys, and even ride tickets. And the data Disney collects as their customers use these bands only helps the company find more ways to improve the user experience.

Walmart
While smaller retailers are dropping like flies, it's only a matter of time before Amazon starts taking out the big name players like Target, Home Depot, Best Buy, or Walmart. The latter, however, decided to take action rather than sit on the sidelines and wait for the inevitable.

Walmart has been squaring up with Amazon by changing its online return policies to make things easier for consumers, offering the lowest prices, and promoting the fact that you don't need a membership to order online (this latest ad hit right when Amazon increased Prime memberships).

But it doesn't stop there. Walmart has also diversified its offerings--buying up online brand names like Jet and Mod Cloth and even selling clothes from Lord & Taylor. In addition, the Walmart mobile app continues to improve the customer experience. The latest update allows customers to add up the costs (including sales tax) on their shopping lists before they even leave the house. Once a customer gets to the store, they can interact with the app's "store assistant" to guide them to items on their list via a map.

The Harvard Business Review sums these efforts up nicely: "Walmart is increasingly becoming a 'digital winner', as it builds out a fast-growing ecommerce business and also leads in digital innovations when compared to other brick-and-mortar retailers."

This is one company that's leaning into digital hard, and giving Amazon a run for their customers' money.


Wrapping up
While each of the above companies uses different strategies when it comes to digital transformation there is one common denominator across the board: a better experience for the customer. The companies that are successful in digital are the ones who put the customer at the center of everything they do. No matter how the technology continues to evolve, the brands that focus on the customer will know the best ways to transform moving forward.
business designbranding strategybusiness strategycustomer experienceexperience designdigital strategycustomer servicebrandcell articlescompany cultureOrganisational Culture
  newer 1 2 3 4 5 6 7 8 9 10  older 
choose a topic:
innovationawards + recognitionbusiness designpackagingawards + recognitionbrandcell newsbrandingbranding strategybusiness strategycustomer experienceexperience designdigital strategyLiveworkcustomer servicerankingsconsumer brandsdesigntipsbrandcell articlesdubairetailconsumer trendsglobal trendsservice designcompany culturebusinessengagementperformancestrategyBusiness Model Innovationconsumer behaviour Organisational CultureKnowledgeKnowledge Managementhuman-centricityHuman-Centered DesignDesign ThinkingEmpathic researchEmpathy
HOW TO FIND US
 


Beirut Head Office
3rd floor, Eshmoun Bldg, 
Damascus Road
P.O.B. 175-764
Beirut, Lebanon
T 00 961 1 335 417 / 321 / 370
F 00 961 1 335 410


Dubai Rep. Office
THE BRAND DISTRICT FZE
Emirates Towers, Level 41
Sheikh Zayed Road, Dubai, UAE
P.O Box 31303
T +971 4 3197635
M +971 50 7058763