Author Archives: Joseph Robinson

About Joseph Robinson

Joseph Robinson is the Vice President of Strategy at Flevy. Flevy is a marketplace for business documents--specifically, documents used by folks who work in a business function (e.g. Marketing, Corporate Finance, IT, etc.). These documents can range from Excel Financial Models to customizable PowerPoint Templates to "How-To"​ Business Frameworks, covering management topics from Digital Transformation to Growth Strategy to Lean Management. You can peruse a full list of management topics available on Flevy here. Prior to Flevy, Joseph worked as an Associate at BCG and holds an MBA from the Sloan School of Management at MIT. You can connect with Joseph on LinkedIn here.

Using Strong-form Product Management as your Company’s Powerful Value Proposition

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Most Product Managers have relatively narrow roles and decision rights on product portfolios are fragmented on various functions. This creates pic 1 Strong-form Product Management Modelincoherence between a company’s product and its overall Corporate Strategy.

What is needed is more accountable decision rights that align responsibility for results to one person who also has cross-functional decision-making authority. This realignment is at the core of Strong-form Product Management.

What is Product Management

Product Management is an organizational lifecycle function within a company. Product Management deals with the planning, forecasting, production, and marketing of the product or products at all stages of the product lifecycle.

The Product Life Cycle (PLM) Management integrates people, data, processes, and business systems. It provides product information for companies and their extended supply chain enterprise. One of the ultimate goals of Product Management is to optimize the business at the product, product line or product portfolio level over the lifecycle of the products.

Taking a Cautionary Case in Point: Understanding What Happened to Research in Motion (RIM)

In April 2007, Research in Motion (RIM) was flying high. The Blackberry creator was coming off its best year ever. RIM was experiencing record revenues, record earnings per share, and record shipments. And there was a new reason to be optimistic: Apple had just introduced the iPhone and RIM executives took it for granted that their product—a runaway hit in the business world—would grab a huge share of the burgeoning consumer market as well.

However, the confidence proved to be ill-founded. The iPhone reversed the historical pattern of computer technologies flowing from the enterprise to the consumer market.

RIM is compelling as a cautionary tale but it is not unique. Many companies falter in the face of discontinuous change. Their failure usually stems from their inability to keep up with technological shifts or the complexity of their product lines. Though often seen as a breakdown at the enterprise level, this starts at a much more granular level, with ineffective Product Management.

A Strong-form Model could have kept RIM stay ahead of change and remain competitive.

The Strong-form Product Management Model

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The 5 steps to Strong-form Product Management will keep competition at bay.

  1. Hire Product Managers with Proper Skills
    We need to understand that intrinsic abilities are required by Product Managers. These are the abilities to make a judgment to understand trade-offs, anticipate market changes, and make savvy business decisions.
  2. Create Financial Transparency to the Product Level
    Companies must realize that a given product may be siphoning revenue from more profitable products. Increase in costs from suppliers that are managed by another function may cause hidden opportunity costs or out-and-out profit surprises. The creation of Financial Transparency down to the product level can address these concerns.
  3. Implement Product-first Decision-making Processes
    There is a need to broaden decision rights and increasing accountability of Product Managers for performance and results. Product Managers have a “first among equals” status.
  4. Develop Strong Customer Relations
    Product Manager must translate customer insights into product improvement and new products.
  5. Encourage Cross-functional Collaboration
    Strong-form Product Management is inherently cross-functional. Communication is essential in developing the relationships between marketing and product management.

In all these steps, the Strong-form Product Manager must be the center of knowledge. However, Product Managers must also realize that the adoption of a Strong-form Product Management Approach requires taking Change Management initiatives.

Undertaking a Change Management initiative can take years to implement. Success can be achieved when anchored on basic principles of Change Management. However, once this is put in place, significant opportunities arise as companies move from strategy to execution.

Interested in gaining more understanding of the Strong-form Product Management Model? You can learn more and download an editable PowerPoint about Strong-form Product Management Model here on the Flevy documents marketplace.

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Preparing the Next Generation: The Key to Family Business Sustainability

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Family businesses did especially well in riding the rising tide.  Family businesses were the particular beneficiaries of three decades of favorable pic 1 Family Business Succession Preparationglobal economics. Propelled by fast growth in the emerging world, the share of family businesses in the global Fortune 500 grew from 15% in 2005 to 19% in 2013.  Five years ago, founders or their families owned 60% of emerging-market companies with sales of $1 billion or more. By 2025, an additional 4,000 companies may join the list.  Family-owned businesses would represent 40% of the world’s large enterprise.

However, despite the growing power and influence of family businesses, executives and investors have a poor understanding of the unique attributes providing the edge.  It is difficult to parse the DNA of family businesses. It is a complex mix of family, management, and wealth creation, all overlaid with a rolling ownership dynamic that claims all but 30% of them.  This 30% is claimed by the 3rd generation.

The number one worry of family owners is the challenge of developing the next generation as motivated and responsible shareholders.   Addressing this concern is critical to the long-term sustainability of family businesses.  It calls for both technical and interpersonal focus.

First Things First

Maintaining an entrepreneurial edge is becoming evidently critical for long-term survival. Creative destruction constantly churns the rankings of companies in the S&P 500 index of the largest US companies.

However, as family businesses grow through the generation, barriers to entrepreneurship and innovation creep in.  Maintaining the entrepreneurial spirit of the next generation of family leaders is essential. But developing, engaging and motivating them is the biggest challenge.

Family owners want to keep the next generation involved. This is to maintain the business as a source of family pride and to preserve the founder’s legacy to keep it within the family.

Successful generational succession can be achieved. Family Businesses just need to take on 3 important principles.

Preparing the Next Generation: The 3 Important Principles for Succession

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  1. Build emotional connections. A common problem in a family business is fostering communication across generations and borders.  It can be difficult but essential when building emotional connections.
  1. Develop responsible stakeholders. Based on the McKinsey Family Business Practice survey, the next generation family members are willing to take more responsibility in running the family business. Yet, only 30% feel that they are confident about making decisions involving Family Businesses.
  1. Establish clear rules and career paths. A leadership position is not the only role for members of the next generation.  There are several important roles to be played above and beyond full-time employment.  A critical need is to develop a path and make family members understand how they can embark on those paths.

Having a good grasp of the 3 important principles will pave the way for effective Succession Planning in family businesses. When these are in place, the very fundamental foundation of the family business is established and ready for the 21st-century challenges.

Interested in gaining more understanding of Family Business Succession Preparation? You can learn more and download an editable PowerPoint about Family Business Succession Preparation here on the Flevy documents marketplace.

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Family Business Governance: Making the Right Moves

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Governance of Family Businesses must include the concerns of the numerous and diverse third Family Business Governancegeneration.  Establishing a set of Councils and Boards is essential in addressing critical transition issues.  With a Governance Model, Family Businesses can address acute short-term challenges and prepare the business for subsequent generations.

Starting the change process can be difficult. Ideally, aunts and uncles will call the cousins together and say,

“What has worked so well for us and makes us proud of what we have achieved will not work for you.  You must go out and find your own model.”

When siblings are wise enough to give such a mandate, the cousin generation has a greater chance of enlisting support from the earlier generation and being successful.   However, many sibling groups avoid or delay dealing with the issue, leaving it up to the cousins to organize themselves.  In most cases, highly educated and qualified cousins leave the business once they find the barriers to establishing Governance Structures so high.

Given the way that Family Businesses tend to become more complex over time, it is often up to the third-generation owners to redefine the role of the family and set the direction of the business.  Setting up an effective Governance Model puts the Family Business on a new trajectory for success.

The 7 Core Elements of the Governance Model

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  1. Shareholders’ Assembly – The Shareholders’ Assembly is primarily responsible for dealing with classical legal functions.
  2. Family Assembly – The Family Assembly instills family values in the next generation and make sure that responsible shareholders are raised.
  3. Shareholders’ Council – The Shareholders’ Council is the most important link to the company. It is responsible for regulating relationships among family shareholders and between shareholders and the business.
  4. Holding Board – The Holding Board is the link between Management and the Shareholders’ Council. It is responsible for the overall performance of the group and its CEO.
  5. Family Council – It is the Family Council’s mission to transfer values and traditions across generations.  It serves as an important communications bridge between the business and the individual family members.
  6. Investment Office – The Investment Office is responsible for managing the family assets other than the core business. It provides a sense of security to those distant from the business and that their interests are being considered.
  7. Foundation – The Foundation is the one responsible for the family’s social and charitable investments.  It nurtures consensus from generation to generation on the direction of their philanthropic activities.

Taking that Giant Step to Governance

Kickstarting the change process can be a challenging part of the sibling-to-cousins transition.  There are cases that exist where highly educated and qualified cousins find the barriers to establishing Governance structures so high that they leave the business.

In making sure that the Family Business can keep the Governance up and running, it must be able to master two critical steps to Governance.

One of the two steps is developing a clear idea both of the status quo and of the desired destination.  What are our goals? Are there existing gaps in the structure? What are our priorities?  These must be clear before we can ever start the Family Business Governance running.

Missing on this step (and the second step as well) will lead Family Business to a difficult turn and very bumpy road to success.

Interested in gaining more understanding of Family Business: Governance? You can learn more and download an editable PowerPoint about Family Business: Governance here on the Flevy documents marketplace.

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Taking the Lead Using the Lean-led Business Transformation

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Big cross-organizational change can be difficult and not all organizational transformation is the same. Lean-led Transformation pic 1

Rapid advances in technology, a growing global creative workforce, and market with fewer and fewer barriers to entry are driving a hyper-creative volatile marketplace.  New ideas are making established business positions obsolete at an increasing rate.  Products and services that survive are exposed to commodifying price pressure.

The world has started to repeatedly demand operational excellence not only in innovation but in the delivery of customer service.  Continuous improvement has been deeply emphasized with the increasing demand in the marketplace. Companies must recognize the fundamental market shifts that are occurring and must learn to respond effectively.  This can be done by building an organization that discovers, shapes, and brings Lean-led Business Transformation to scale as part of its core business direction and purpose.

Lean-led Business Transformation provides the business the institutional capability and framework to adapt to rapidly changing opportunities

Understanding the Lean-led Approach

An approach based on Lean Thinking provides business tangible results that are evident in financial performance, customer and employee satisfaction, and risk mitigation.

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From Lean-led Approach to Lean-led Transformation

Companies are increasingly under pressure to cut costs and grow. Applying the Principles of Lean Management allow companies to fundamentally transform their operating models.

Using a Lean-led Business Approach, the company can effectively undertake a Lean-led Business Transformation.  An effectively undertaken Lean-led Business Transformation can help the company build a robust, factual understanding of its current state, exposing improvement opportunities to design an end-state operating model with enabling capabilities.

In effect, the company can achieve insurmountable results that competitors will find difficult to follow.

  •  The company will achieve best-in-class efficiency.
  • It will reduce client, financial, and regulatory risk.
  • It will create measurable client impact.
  • It will lead the company to scale-up with growth.

A Lean-led Business Transformation embeds continuous improvement in the organization. It engages employees to help business leaders successfully govern and execute change.

What Companies are Facing Today

Changing market trends have pushed companies towards Lean-led Transformation.  These market trends are adding pressure on companies to simultaneously cut costs and grow.

  1.  Commoditization of Basic Services. The value of basic stand-alone services is declining leading to the increase in integrated services. As a result of the trend, there is a decreased unit margin per transaction
  2.  Increased Complexity and Globalization of Investments. There is growth in cross-border activity, alternative investments, and alternative exchanges. As a result, technology and compliance investment requirements are changing. Likewise, it has opened an opportunity for growth and revenue diversification.
  3.  Stricter Regulation. There is increased regulatory oversight such as consumer protection.  As a result, new processes and technologies need to comply with regulations.  There has also been an increased client need for advisory services.
  4.  Increasing Focus on Risk Management.  There has been an increase in risk aversion and a demand for risk management. In effect, new risk assessment capabilities and oversight practices have been developed.
  5.  Change in Consumer Behavior.  There has been reduced willingness to incur debt as well as deterioration of trust and customer loyalty. Because of this trend, businesses have been experiencing declining profitability and increased competition for creditworthy consumers.

These changing market trends are here to stay and more trends will soon evolve and affect business.  Failure to heed these market trends can lead to decreased margins and profitability that can be highly detrimental to business.

Undertaking this form of Business Transformation can drive businesses to undertake executable Lean Programs that will strengthen their capability to meet these challenges.

Interested in gaining more understanding of Lean-led Business Transformation? You can learn more and download an editable PowerPoint about Lean-led Business Transformation here on the Flevy documents marketplace.

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Your Practical Guide to Knowledge Management 101

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“Knowledge has power because it controls access to opportunity and advancement.”(Peter Drucker)Knowledge Management primer

The 21st century is undoubtedly the century of knowledge.  The everyday usage of available advanced information and business technologies, and internet in business activities just show how rampant corporations are engaged in information exchange and Knowledge Management.

In the light of globalization, companies are now exposed to an unpredictable and complex competitive environment. Pressures are put on companies to adapt quickly to survive in the competitive market.   The vital strategic resource is Knowledge. Companies have started to realize the major value of an intellectual resource.  The central role of Knowledge Management in making a quality decision has never been emphasized as much as today.

Intellectual resources and Knowledge are now contributing to revenue generation and increasing reputation.  It has contributed to creating barriers to entry of potential competitors, increase customer loyalty, and create innovation. In today’s world, the success of the organization now depends largely on continual investment in learning and acquiring new Knowledge that creates new business and improves current performance.

Understanding Knowledge Management

Knowledge Management (KM) is a multidisciplinary approach to achieving organizational objectives

It is an integrated approach to gathering, analyzing, storing, and sharing knowledge and information within an organization. It ensures that the right information is delivered to the appropriate place or person at the right time to enable informed decision making.

An enterprise-wide ability must be created to transition data and information into critical knowledge.  This is to ensure service stability, maintainability, and performance leading to organization wisdom.

Knowledge Management evolves around 3 primary spheres which are closely integrated with each other.

Technology

  • Provides a secure central space where employees, customers, partners, and suppliers exchange information, share knowledge and guide each other and the organization to better decisions.
  • A knowledge- portal which allows team members to use and share information.

KM Processes

  • Standard processes for knowledge contribution, content management, retrieval

People

  • Participation of team members in knowledge sharing, collaboration, and reuse to achieve business results.

AT Flevy, we’ve developed a The Knowledge Management Primer that examines and discussed the purpose and nature of the key components of Knowledge Management.  It demystifies the KM field by explaining in a precise manner the key concepts of KM tools, strategies, and techniques, and their benefits to organizations.

The quest to set up a Knowledge Management system requires an understanding of the essential elements integrated within the Knowledge Management Approach. This includes an understanding of the DIKW Model or Pyramid, the importance of Knowledge Assets, and the structure and priority of information based on its Knowledge Hierarchy.

What is Knowledge Hierarchy

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  1.  Operational Knowledge. The focus of Operational Knowledge is to gain operational effectiveness. It helps organizations understand how service performance, compliance, and overall IT operational effectiveness is managed.
  2.  Tactical Knowledge.  Tactical Knowledge is focused on service value. It helps organizations understand how to manage and ensure service value.
  3.  Strategic Knowledge. Strategic Knowledge is focused on benchmarking and advanced analytics. It helps organizations understand the effects of operational decisions.

In the Knowledge Hierarchy, it must ensure that resulting knowledge is well defined, specific, comprehensive, and with high average quality information.

Interested in gaining more understanding of Knowledge Management Primer? You can learn more and download an editable PowerPoint about Knowledge Management Primer here on the Flevy documents marketplace.

Are you a management consultant?

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