New markets, new products
In addition to buying ecosystem partners, many organisations are looking to open up new competitive spaces via innovation, by sharing technology or by moving into new markets.
This is the motivation behind recent mobile acquisitions in Africa and new products such as the PCTV card for mini-notebooks, developed by NXP and Pegatron. Another example of the drive to mine new markets is News Corps interest in Free, Frances second home broadband player. The big challenge for organisations is to be clear how their products or markets fit together. Many organisations fail to clarify their new operating model and generate confusion and internal conflict as a result. They also need to be able to rethink and innovate constantly in order to jump on market opportunities.
Rethinking the mindset
Until recently, the main characteristic of the CMT sector was growth. But now consolidation and efficiency will be the keys to success. This means much more rigour around investment choices and a change of mindset for employees. They need to keep their passion around creativity and change, but add process, rigour and operating effectiveness. We are also witnessing a move, too, from customer acquisition to retention, from short-term sales to long-term value. As a result, your criteria for employee success might change. It could mean hiring or retaining a different type of person, as well as a fundamental change in the culture of your business. The industry can learn a lot from utilities, food, airlines or other process-intensive business, where the focus is on customer value and process efficiency.
Downsize the destructors
Recently, Hay Group research shows that typically, half of leaders destroy value by their leadership behaviours. These value destructors behave in a way that minimises motivation and reduces productivity. They tend to be leaders who focus on the short-term and cost the industry billions of dollars a year, too high a price in any economy let alone a tough one. Too many organisations jettison both the good leaders and the bad. Instead think about the type of business you want to be, the type of people you need to deliver it and then fire, targeting those who destroy value.
The CMT industry will look very different in 2010. Those who are successful currently may not be in the future. Companies have to respond to short-term challenges but in a way that doesnt restrict capability. By being clear on your strategy and operational approach, you can build an effective organisation through the right PEOPLE.
Stephen Choo is Regional Director, Southeast Asia, of Hay Group Insight, the employee survey division of global management consultancy, the Hay Group, which works with leaders to transform strategy into reality and aligning strategic goals for increased performance.