Five things I’ve seen, read, or thought might seed results:
1. Is the belief that mergers drive revenue growth a delusion? — McKinsey Quarterly
To evaluate a merger’s success evaluate the impact on revenue. Revenue determines the outcome of a merger, not costs; whatever the merger’s objectives, revenue is what hits the bottom line harder.
In a merger too many companies lose revenue momentum as they concentrate on cost synergies or fail to focus on postmerger growth in a systematic manner. A study by Southern Methodist University of 193 mergers, worth $100 million or more found that only 36% of the targets maintained their revenue growth in the first quarter after the merger announcement and by the third quarter, only 11% had avoided a slowdown against industry peers.
Complementary strengths for repeated success successful acquisitions:
1. Cost disciplines are “hardwired” at every level, this allows senior management to focus on revenue;
2. Recognize that successful mergers lead to a virtuous cycle of better deals and better results and enables companies to develop a meticulous merger discipline that improves with experience; and
3. A performance culture is instilled and geared for growth and these companies use every means they have — notably, entrepreneurial, well-mentored teams with ambitious targets and incentives to instill performance expectations
2. New media versus old media, who knew there really was a fight going on?
Point: The Future of Advertising, Mayhem on Madison Avenue — Fast Company
Thanks to the Internet and digital technology, agencies are finding that the realization of their clients’ ultimate fantasy—the ability to customize a specific message to a specific person at a specific moment—is within their grasp. Digital isn’t just one channel. It’s a medium that blooms thousands of other mediums.
Life is much more confusing for the chief marketing officers who don’t know where to turn. They have little confidence that old-world agencies know how to navigate the chaos, and they don’t know which newcomers to trust. Producing an ad doesn’t have to be an expensive multiperson affair these days, given that commercial-quality high-definition video can now be shot on cameras that cost less than $2,000.
Counterpoint: Don Draper’s Revenge — Bloomberg BusinessWeek
After a couple of years of slumping fortunes, the Big Four advertising agency holding companies—Omnicom, the WPP Group, Interpublic, and Publicis—are bouncing back.
“All these little companies with fun names,” says David Lubars, “we’ve kicked their butts.” Lubars, chairman and chief creative officer of Omnicom’s BBDO North America, an 82-year-old Madison Avenue agency with more than 17,000 employees gesures to BBDO’s 2010 Webby award for best ad agency of the year.
“Americans like a story of the big guys getting taken down,” says Lubars. “But that doesn’t mean that’s what is actually happening.”
3. Becoming a Change Agent — Chief Learning Officer Magazine
The easiest way to become an organization pariah? Get labeled a change agent. Not many people like change, even less like to be told to change. Why is change demanded, but feared? Perhaps, as Professor Howard Stevenson, founder of the entrepreneurship program at Harvard Business School, believes a surefire way to kill the entrepreneurial spirit within an organization is to punish failure severely. “[It] simply says to your best people: ‘Take on the safest problem,'” he said.
Instead, leaders should support their innovators throughout the risk-taking process. Leaders have the ability to present a compelling business case with courage and confidence, persuasively and respectfully answering the concerns of their toughest skeptics. As Jeff Bezos says, “I believe that you have to be willing to be misunderstood if you’re going to innovate,”.
What are the capabilities that will position leaders to confidently lead change? There are 4 key capabilities. For change agents of today to become leaders of the future they must be:
4. Group IQ — Boston Globe, Ideas Section
We attribute too much press to individuals and not enough to groups, perhaps it is far easier to point to company’s CEO as the reason for success. However, with the amount of data the Internet provides on people joining and leaving groups a few new studies show that teams of people display a collective intelligence that has surprisingly little to do with the intelligence of the team’s individual members.
Group intelligence shows that neither the average intelligence of the group members nor the person with the greatest intelligence strongly predicted how well the group did. The collective intelligence, more than just an arbitrary score, showed up when groups in the study grappled with a complex task. Researchers then found an excellent predictors of how well a team can perform.
Another takeaway: success and creativity seemed to depend on groups that do not become stale or use the same slate of collaborators each time. Strikes an odd challenge to those executive retreats.
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