The Strategist

Address A Problem With An Innovative Solution Before Devising A Strategy

04/17/2015 - 11:58

Having a strategy and executing it religiously cannot make a company a market leader, says Favaro. He gives examples of successful business companies to illustrate that a leading figure with an innovative problem solving idea makes all the difference. – 14 April 2015 – According to Ken Favaro it is a well known fact to leading business figures that successful iconic companies are a result of strategic visions and its smart executions. Nevertheless, most fail to realise that in the process of executing strategies the former gets separated from the latter.
Usually, at the outset one sets the goals which are either “financially oriented” or strategic in nature. The former case includes increasing the income certain amount within a given range of years whereas the latter case refers to establishing a company as a leading figure in specific markets. In order to achieve the set target one then prioritises, invests wisely and reorganises the plan of action. After which comes the period of implementation wherein one reviews the progress and if required rewards the performance.
However, some companies succeed while others fail in meticulously following such programme, which could give a possible explanation of the difference between the leading companies and the ordinary ones. But, according to Ken Favaro’s experience there is “something much more significant” involved behind it.
Favaro gives an example of the Cardinal Health Company which figures in among the world’s leading pharmaceuticals distributors. The said company began its career as a “food distributor” but under the initiative of the founder, Mr. Bob Walter, the company changed its course of function as Walter wanted to earn better livings through high margin drug distribution rather than “low-margin food”. Nevertheless, the decision to shift over to more profit making business wasn’t enough by itself to change the destiny of the company; it was backed by Walter’s visionary idea.
During the early 1980’s, the market of medicine distribution “was well established” but “highly fragmented” within the local distributors. Consequently, the sourcing of drugs according to physician’s prescriptions proved to be a difficult task for the retailers.
At this juncture, Walter’s innovative idea of “prime vendor model” which will collect the drug supplies directly from the manufacturer “on behalf” of the retailers or any group of hospitals proved to be result of much needed “rational consolidation”. Nevertheless, any change is faced with opposition from the older system; similarly Walter had also overcome the resistance from the old market’s buyers and suppliers. With his steadfast and devoted focus, Walter turned a normal “food distribution” agency into a leading healthcare business model of $20 Billion’s worth, just within a span of twenty years.
There are other such examples of success stories like Starbuck, Burberry Group, and Puma who have changed their fate because of particular leading figures. Looking closely at all these success instances, one sees a common thread of target goals set by their respective leaders, followed by a course of action through a disciplinary monitored implementation that lead each of them to the winning market platform.
In fact, these were not the only common traits between them; the iconic leaders all had an innovative strategy forming the base of their goals which they were committed to make them happen. Favaro stresses on this level of commitment which allowed the executive figures to achieve their goals. In short Favaro writes, the success came through the path of “problem-idea-strategy-leadership”.
In Favaro’s words:
“...mastering the strategy-to-execution challenge starts by asking two questions:
 ·         What’s the big problem your company or business is trying to solve?
 ·         What’s the big idea you have for solving it?”
Having an answer to these two questions are important before moving onto the strategy part. Moreover, most importantly, the success story begins with a leader who has an innovative idea to solve “a big problem” instead of getting caught up in the systemic flaws. After all , as Favaro puts it:
“...all companies (even the most “disciplined”) are a mess when you look inside them...”
So instead of getting disheartened by the negative aspects, a leader with an innovative problem solving idea can inspire the subordinate to put in their hundred percent to succeed in the journey of strategy to execution. 


< >

Thursday, May 16th 2024 - 03:10 HSBC starts looking for new CEO