“Competing globally does not mean being a global business … the two are not synonymous”
Joe Fuller, CEO, Monitor Group
Last night I had the opportunity to attend a talk by Joe Fuller, CEO of Monitor Group up at the MaRS Discovery District here in Toronto. I had originally expected to hear about Globalization, how to take your business global etc. But as you can probably tell by the line quoted above, that wasn’t his focus. Regardless though it was still an incredibly valuable talk to be a part of.
While many of his points were squarely focused at larger companies there was still tonnes to take away for us smaller guys (and then use to help make us bigger). If I can be bold enough to try and distill his talk into a theme it would revolve around focusing your organization around your core business and only trying to compete or innovate within that space.
Companies win on their home turf
Your core could be a region of the world, a market or even a very particular niche but he was adamant that the most competitive companies will “start with some robust position within a core market”. Find your home turf, own it and defend it through innovation.
His position largely appeared to be that a company should really only retain direct control of their primary core and outsource the rest. i.e. Focus on making the best widget and innovate in that space, but find a company to worry about making the best box to hold it.
A theme that continued to come up was the “Durability of Competitive Advantage”. Joe defined durability as being a circumstance where what you do and how you do it can be obvious or visible yet your competitor’s can’t replicate it (or it’s near impossible to accomplish).
His example was GM vs. Toyota. They both have cars as products, they both know how to make cars yet Toyota’s cars remain quantifiably better then GM’s on many metrics. I’d even take it further and suggest comparing Ford to Toyota. Ford essentially created the market – yet all these years Toyota is driving away with it because they focused on their core and continue to innovate within it. The durability of Ford’s competitive advantage wasn’t strong enough. Granted this took many, many decades to evolve but things are moving much faster in other industries now.
Think broadly about innovation
He also stressed to look across the board within your organization for innovation opportunity. Toyota’s durability isn’t their cars – those are just the result – their true durable advantage is their process of building those cars. I doubt they spend much time worrying about making a better tire (that’s Goodyear’s core) but they do want to make sure that when that tire is attached to the car it’s done properly.
The difference is they aren’t focused on making CARS better – they worry about MAKING cars better. Subtle difference but a very different result.
His big thing as well was not wandering outside of your core (essentially “Do one thing and do it well”). He warned strongly against trying to innovate outside your core. (i.e. Toyota shouldn’t try to create a line of tires). Pick where you’re stringest and fight that battle.
Know your true competitors
Joe also shared some thoughts on competition. I thought one point was exceptionally interesting and that was along the lines of knowing who your true competition is. When people consider their competition they generally quickly point at the largest fish in their sea. (i.e. Translation service providers might point at SDL or Lionbridge as their primary competitors)
The reality though is that the big fish are rarely your immediate competition, especially when you first start out. The concept I took away was “There’s only so much room on the boat – make sure you can get on the boat before you start worrying about driving it”. Essentially there’s lots of work out there, SDL & Lionbridge combined could never do ALL of the translation work in the world. The companies a smaller service provider needs to be aware of are the guys just like him – the guys who are competing for the same size table scraps. Eat enough and one day you might be big enough to challenge to top dogs.
Employees as “Voluntary Participants”
Lastly there was one point he mentioned that I found really interesting – that was the notion that employees will more and more become “voluntary” participants in the organization. The days of one career, one company are long over and businesses will have to work harder to ensure their employees continue to believe in the organization and not begin to wonder if the grass is greener elsewhere. Money will become less and less of a factor and even begins to plateau in it’s effectiveness after a certain amount.
That’s most of what I took away from the session – I’m really glad I went and highly reccomend you try to catch Joe if he happens to be speaking near you in the future. I also highly suggest watching the MaRS website ( http://www.marsdd.com ) for events if you’re in Toronto. They just keep bringing quality session after quality session to the table at ridiculously reasonable price points.