One of the most interesting articles I have read recently came from the Harvard Business Review, which sheds light on the shift in strategic approaches that the most successful businesses are now adopting.
It makes the argument that gone are the days of traditional SWOT analysis, competitive advantage, and disruption strategies. Instead, this latest thinking suggests that a new strategic playbook centered around ecosystems and ecosystem partners is emerging as a key driver of success in today’s environment.
The research for the article analysed 3000 businesses and identified 15 pairs of companies where one significantly outperformed the other these pairs include the likes of Nvidia vs. Intel, Microsoft vs. Oracle, Netflix vs. Paramount, Tesla vs. Ford, and Hibbett vs. Foot Locker.
From this analysis six strategic concepts emerged as key drivers of success for the high-performing companies, and I started thinking about them and about which of them related to my own business ERIKS UK & Ireland as well as the wider context of manufacturing.
The six strategic concepts are: Borrow Someone’s Road; Partner with a third party; Reveal your strategy; Be good; Let the competition go; Adopt small scale attacks
Some of the concepts are more relevant to our sector than others, for instance, to ‘Borrow someone’s road’ is about reaching markets through channel partners versus going direct and the article cites semiconductor manufacturer Nvidia’s partnership with British software design company ARM Holdings as an example that allows Nvidia to tap into ARM’s reach across diverse tech sectors. As a channel partner business ourselves, we completely understand the relevance of this and our relationship with businesses such as WEG, Festo, Fenner and SKF allows them to do exactly the same thing.
Similarly, the concept of to ‘partner with a third party’ is something that we see the value in. The article cites as an example, Microsoft’s decision to make Office available on Apple’s iOS devices in 2014, which not only expanded its user base, but also delivered a more complete solution for users. I see the work we do with our suppliers in the same light and in some areas, there is an element of competition, but the winner is the customer.
The third concept, ‘reveal your strategy’ I totally endorse and from the ERIKS point of view we embrace it in the following way. The article talks about the agricultural business Deere & Co and how it ‘owned’ the Agri-Tech space through revealing its roadmap and talking about it publicly. When our OnSite team work with a business such as Weetabix (which we have done for 20 years) it’s essential that the manufacturer reveals their overall strategy to us so that we can align our work with their ambitions. Without such transparency you are working in the dark.
One of the strategic concepts was something of a ‘no brainer. To ‘be good’ is something that all businesses should strive for. Working as we do with manufacturers and engineering businesses; I am always impressed by how much work is being done to continually improve the sustainable performance of the business and we at ERIKS are just the same. But I am mindful that we need to ‘be good’ to both planet AND people. We, like many businesses, are improving the experience that our employees have and are being more flexible where we can, but we are also extending this by being open and honest with our customers and prioritising long-term relationships over short-term fixes which can sometimes be painful. We’ve also made it easier for our customers to give us feedback, and again, this is to be people focused.
The penultimate strategic consideration of ‘Let the competition go’ is about letting others test the market and technology, and being ready to leapfrog them if they prove the opportunity. I can see the sense in this ‘fast follower’ approach, which should appeal to the conservative nature of manufacturers, plus in today’s ‘start-up’ environment there’s less of a need for large businesses to find and open up the opportunity than to partner with or support these innovations.
Finally, and this is one point I really do want to emphasise, I see the use of running business experiments in which the goal is to learn as being highly relevant to ERIKS, especially our OnSite business and the article labels this as to ‘Adopt small-scale attacks’. MRO stores management is one area in which rather than building bullet-proof business cases, a manufacturer can take small steps, learn from them and then decide whether to invest further.
In my view, given the above, the implications for strategists are clear – it’s time to rethink traditional approaches and adopt a new strategic playbook that aligns with the demands of the modern business environment. I think that as we look to the future, it’s evident that companies willing to adapt and embrace this new strategic playbook, try something different, and perhaps outsource their MRO supply chain to set themselves apart from the competition and achieve long-term success.
Pamela Bingham is the CEO of ERIKS UK & Ireland, a specialised Industrial Service Provider. With more than 25 years’ experience she is a qualified solicitor and has served as the turnaround CEO of an international manufacturing and building product supply businesses with a turnover of circa €500m. In addition, she has served as a NED in a FTSE 250 business as well as being an International Divisional Compliance Director for a Fortune 500 company.
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