Michael Jacobides, Sir Donald Gordon Professor of Entrepreneurship and Innovation & Professor of Strategy and Entrepreneurship - London Business School.
Based on your current work – if you had only six words of advice to give a business, what would they be?
Revisit portfolio, value propositions, digital connections.
What does this mean?
In times of crisis, firms tend to focus mostly inside- and batten the hatches. Yet what’s happening with COVID19 is not just a recession. It’s a change in what customers want, and how they consume it. It catalyses change and alters long-held habits. To succeed, we need to overcome the inertial forces organisations are subject to.
First, we need to re-assess what customers want, and how this crisis has changed their requirements, both in the short and the long run.
Second, we need to revisit our business models, in light of the shift to digital channels of communication, coordination, and consumption. We need to find a way to engage with the increasingly powerful digital ecosystems that mediate people and their consumption habits, and see how we can take advantage of the opportunities that are offered by new business models and new distribution channels.
And we also need to dis-aggregate our business and radically rethink how capital and resources are allocated. We need to resist the temptation to replicate the status quo, and instead we should ruthlessly reallocate capital and resources, investing in new growth pillars even while trimming costs and scaling back for part of the business.
Where should we look for further information?
See Harvard Business Review, September 2020.