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Intelligence briefs

An eclectic collection of discoveries & developments:

A new biosensor developed at the Georgia Tech Research Institute can detect avian influenza in just minutes. In addition to being a rapid test, the biosensor is economical, field-deployable and sensitive to different viral strains. — Georgia Institute of Technology

Brazilian food companies recently made two cross-border acquisitions: JBS (Latin America’s largest beef processor) bought Swift & Co.; and Perdigão (a leading Brazilian food company) bought Plusfood Groep BV in Europe. “While only two data points, we wonder if this foreshadows additional cross-border acquisitions by Brazilian companies in the increasingly global food industry.” — GE Commercial Finance industry newsletter

Sixty percent of Americans are pessimistic about the state of the environment and want prompt action taken to improve its health, according to a national opinion poll. The survey found that 52% of Americans expect the world’s natural environment to be in worse shape in 10 years than it is now. An additional 8% said the environment is in poor or very poor shape and won’t improve. — Woods Institute for the Environment at Stanford University / Associated Press

India could challenge the position of China as the manufacturing center of the world in the next three to five years because China is becoming too expensive. Labor costs are surging on China’s eastern coast. — Capgemini / ProLogis

Starbucks has always insisted that the company doesn’t market its caffeinated beverages to children and teenagers. But company officials acknowledge that they’re considering introducing drinks and drink sizes suitable for the under-18 set. — MSNBC (10 September 2007)

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Top HR challenges (hint: they include acquiring, retaining and grooming key talent)

Ranked list of the top HR challenges (in North American business)

  1. Acquiring key talent/lack of available talent
  2. Building leadership capability
  3. Driving cultural and behavioral change in the organization
  4. Retaining key talent
  5. Increasing line manager capability to handle people-management responsibilities
  6. Succession planning
  7. Constraints on headcount (“making do with less”)
  8. Increasing workforce productivity
  9. Lack of consensus about the organization’s strategy/direction
  10. Encouraging organizational innovation
  11. Resourcing and managing HR issues in “new geographies” for the company
  12. Managing human capital during and after an acquisition or merger
  13. Implementing people changes resulting from changes due to operational performance
  14. Workforce planning
  15. Measuring the contribution of human capital to business performance
  16. Reducing overall human capital costs
  17. Coping with an aging workforce

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Base: Survey of 154 senior HR professionals in the U.S. and Canada
Source: “The State of HR Transformation,” North America, Mercer Human Resource Consulting, 2006
Discovered via Workforce Management (10 September 2007)

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Intelligence Briefs

An eclectic collection of discoveries:

Non-profit organizations could be hard-hit by talent shortages exacerbated by the large cohort of baby boomers soon entering the retirement years. — The Conference Board

De Beers — which has dominated the wholesale diamond industry for decades and has three ultra-exclusive retail shops in New York City, Las Vegas and Beverly Hills — has started selling jewelry online, at its Web site debeers.com. — Internet Retailer

Myth-buster: Most call centers serving U.S. consumers are actually in the U.S. — not outsourced abroad. — Cornell University

CEOs often pursue acquistions — regardless of risk — because they know their salaries will increase substantially, leaving shareholders to take the financial hit. — University of Washington / The Journal of Finance

Twenty ways to use LinkedIn productively. — Web Worker Daily

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Bain: Unlocking ‘hidden assets’ is key to avoiding business extinction

A 10-year study by Bain & Co. finds that 75% of Fortune 500 companies “face the threat of extinction within a decade” unless they tap their “hidden assets … to redefine themselves.” What sort of hidden assets? Bain’s “Unstoppable Growth Study” study says:

  • hidden customer assets: customer segments and data that can prompt new products and businesses
  • hidden growth platforms: platforms that can be expanded or created for new product lines and business units
  • hidden capabilities: technologies, processes and expertise that can lead to a breakthrough product or service

“These hidden assets were central to 90% of the cases where companies successfully redefined their core businesses and their growth formulas. The assets were not themselves hidden, but their full potential had not been recognized by management,” Bain says.

Typical strategies that usually don’t work:

  • leaping to new hot markets
  • pursuing “big bang” transforming mergers
  • launching broad-based innovation programs

So where does the dreaded threat of “extinction” come from? The following megatrends:

  • Faster movement of information
  • Speed of capital formation
  • Emergence of China and India, and their disruptive impact
  • Reduced capital intensity among the most profitable new industries
  • Increasingly rapid movement of executives among companies
  • The rise and impact of private equity firms
  • Speed of overall technology cycles

Success stories — companies that stepped back from the brink by unlocking their hidden assets — include Apple (think: iPod) and Marvel Entertainment (think: “Spiderman” blockbuster movies). “Companies that seek growth solutions based on hidden assets are four to six times more likely to survive,” the study says.

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About the study:
Tracked the 500 largest U.S. public companies from 1995 through 2004 and assessed their financial performance and rate of change. More extensive 10-year before-and-after profiles were then developed for 50% of the remaining companies that didn’t go bankrupt or get acquired during that period. Also surveyed 240 global executives and developed case studies on 25 successful business redefinitions.

Related:
The book: Unstoppable: Finding Hidden Assets to Renew the Core and Fuel Profitable Growth, by Chris Zook (Harvard Business School Press, 2007).