Building new businesses & business models

Day two of The Big Rethink started out with sessions built around “Fresh Thinking about Business Models”.

Grant Thornton were commissioned by the Economist Intelligence Unit to ask the question:  “Do existing business models still deliver the goods?”  Terry Black, Partner at Grant Thornton reported on the key findings which were actually a bit depressing.  The study surveyed 396 senior executives in the UK and 69 in the Republic of Ireland totally 465 respondents.

They found that most businesses were being tactical instead of strategic — e.g. emphasizing cost-cutting instead of realizing that they might be missing opportunities by not putting some focus on R & D/Innovation.  Most executives were pessimistic about return to growth and it seemed that in many ways complacency is preventing more widespread business model innovation.

Part of their report is a telling clustering of mindsets that seemed to characterize the executives, as follows (model behaviour in parentheses)

• 10% — Heads in the sand [Neg]
• 19% — Ahead of the curve [Pos]
• 25% — Fighting the last war [Neg]
• 18% — Best before [Neg]
• 18% — Moving to the margins [Pos]
• 10% — Hitting the panic button [Neg]

This set the stage for Ferdinando “Nani” Beccalli-Falco, President and Chief Executive Officer of GE International to talk about his 35 year experience in GE — his advice in a nutshell is that businesses need to think outside of the box.  His example was reverse innovation — where GE engineers designed a mobile ultra-sound for use in rural communities in India and now these units are called the “new” stethoscopes for doctors making their rounds in the developed world.   So solving a problem in a developing country and then finding a new market in the developed world.

Jonathan Sands was next up with “Tools to Change our Business”.  Jonathan is the Chairman of Elmwood, a global brand consultancy.  In the end he didn’t really give us tools but a world-wind tour around the globe that made some points about trends and branding.

One of the strong messages of the day from Jonathan and others was:  businesses (in the UK) — get out into the world — see what is happening in China and India.  It will change your business and your life!

A few tidbits:

• Trends:  nostalgia, humour, togetherness, random acts of kindness
• Great brands tell great stories:  goodie vs. baddie, character vs issue, character vs. environment
• Step change:  critical to step into other people’s shoes
• Small biz better risk takers;  big biz not brave and more interested in incremental change
• Make mistakes — fast failing

What followed was a series of case studies focused on how the consumer is changing everything:  Penguin, Virgin Atlantic Airways, TomTom — and a summary from Jonathan Basin, Chief Heretic at BaskinBrand.  Will do this in another blog.

The day finished up with an “Innovation Master Class with the Design Council” and “Four visions of the world tomorrow and how to build your company around them” by Robin Bew and Sir George Cox.  These also deserve their separate blogs.

Am still in London so the day awaits.