Foundations of Corporate Success: How Business Strategies Add Value
John Kay
Language: English
Pages: 416
ISBN: 019828781X
Format: PDF / Kindle (mobi) / ePub
How did BMW recover from the verge of bankruptcy to become one of the Europe's strongest companies? Why did Saatchi and Saatchi's global strategy bring the company to its knees? Why has Philips outstanding record in innovation not been translated into success in the market? What can be learned from the marriage contract about the conduct of commercial negotiations? These are some of the questions addressed as John Kay asks What makes a business successful?
strategy in translating distinctive capability into competitive advantage. Table 2.3. Added Value Statement: Philips, 1990 (m. Ecus) European winners By the criterion of added value, Glaxo is a success, and Philips a failure. Table 2.4 shows the European Community's 'top ten' firms of the 1980s measured by the ratio of added value to net output. Most of the companies in that list are household names. Benetton is famous for its knitwear, sold through franchised retail outlets around the world.
is for player 1 and the upper right for player 2. Circles indicate that a pay-off is the best outcome for that player given the strategy of the other. Fig. 3.1. The Prisoner's Dilemma problem with daily business application. Several instances will be developed at greater length in later chapters of this book. One—which is at the heart of the joint venture problem—is the problem of sharing information. That problem arises both within organizations, and between firms at different points of the
those who provide the service change. Why should lawyers continue to turn with confidence to Halsbury's Laws of England when they know that Lord Halsbury has been dead since 1921? The answer is that the current owners of that title (the publishers, Butterworths), perceiving that its reputation for reliability is an asset of considerable value and that the demand for legal reference books is an enduring one, have a powerful incentive to ensure that the current editors maintain high standards. Ihe
throwing it out of the window, so that rivals are in no doubt of your intention to stay in the game. The problem of commitment, as the extravagance of the example illustrates, lies in making the commitment credible. Pre-announcement of innovative products which have certainly not yet been put in marketable form and may not have even reached a prototype stage has been a regular feature of the recent evolution of the computer industry. It has been such a regular feature, in fact, that such
the Battle of the Sexes is played, at length, in the offices of governments or the European Commission. In the television market, Rupert Murdoch's commitment to Sky was more credible than the fragmented and changing ownership of BSB. This credibility was the characteristic, above all, which IBM brought to the personal computer market. INNOVATION 109 Architecture in support of innovation Often what appear to be competitive advantages based on innovation are in reality the product of