Extractive summaries of and key takeaways from the articles curated from TOP TEN BUSINESS MAGAZINES to promote informed business decision making | Week 237|March 25-31, 2022
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Shaping Section : Ideas and forces shaping economies and industries
Why energy insecurity is here to stay
The Economist | March 26, 2022
Energy and commodities lie at the dark heart of Vladimir Putin’s regime. As Russia supplies 10-25% of the world’s oil, gas and coal exports, many countries, especially in Europe, are vulnerable to coercion by it. For them, the war in Ukraine has been a shock that adds urgency to the creation of an energy system which depends more on sun, wind and nuclear reactors than on derricks and rigs. Yet don’t fool yourself that this new era will allow an easy escape from the curse of energy crises and autocrats.
The longer-term question being asked by many is: how fast can Europe abandon fossil fuels altogether? The energy strategy announced this month by the EU envisages independence from Russia by 2030—in part by finding new sources of gas, but also by doubling down on renewables. As the folly of relying on Russia becomes clear, nuclear power is back in fashion.
Yet although geopolitics will hasten the climate-driven energy transition, they will not make it risk-free. The transition will disrupt some economies and cause new dependence on others. To gauge this The Economist has simulated spending on a basket of ten natural resources, including oil and coal, and the metals used in power generation and the electrification of industry and transport. As the world decarbonises, spending on this basket will fall from 5.8% of GDP to 3.4% by 2040. Yet in this simulation over half of that will still go to autocracies, including new electrostates that provide green metals such as copper and lithium. The top ten countries will have a market share of over 75% in all our minerals, which means production will be dangerously concentrated.
Two problems therefore stand out. First, the geopolitics of shrinking the oil industry are fraught. As Western firms withdraw for environmental reasons and in response to high costs, the market share of OPEC plus Russia will rise from 45% to 57% by 2040, giving them more clout. Second, the emerging electrostates face their own battle with the resource curse. As with all commodities, soaring prices will eventually trigger a market response. Tight supply gives firms a huge incentive to step up recycling and to innovate. Yet even as markets respond, governments must also redouble their efforts. Because self-sufficiency is rarely an option, diversification is the goal. That means new partnerships.
3 key takeaways from the article
- As Russia supplies 10-25% of the world’s oil, gas and coal exports, many countries, especially in Europe, are vulnerable to coercion by it. For them, the war in Ukraine has been a shock that adds urgency to the creation of an energy system that depends more on sun, wind, and nuclear reactors than on derricks and rigs.
- The longer-term question being asked by many is: how fast can Europe abandon fossil fuels altogether?
- Although geopolitics will hasten the climate-driven energy transition, they will not make it risk-free. The transition will disrupt some economies and cause new dependence on others.
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Topics: Russia, Ukraine, Energy, World Economy
Industry Insights
4 Digital Innovations Transforming the Fashion Industry
By Rebecca Deczynski | Inc | March 23, 2022
Shopping for clothes is starting to look very different than it used to. The pandemic has accelerated the adoption of e-commerce which is likely be propelled by innovations that help consumers shop smarter, more sustainably, and in a more personalized way. Four ways that companies are already transforming the fashion world through new digital developments.
- Enabling virtual try-ons. More online clothing orders means more returns–that creates a serious sustainability problem, both financially and environmentally. Founded in 2018, 3D Look allows online shoppers to create a custom avatar by submitting 2-D photos. With their avatar, they receive customized fit and sizing recommendations. The company’s goal is to help people buy clothes that they know will actually fit and look good, even when there’s not a fitting room in sight. According to the company it compute over 86 measurement points on the human body, and that becomes the basis for their size recommendations.
- Helping brands assess demand. How do you avoid having a bunch of unsold inventory at the end of a season? Knowing exactly what your customers want and getting a better understanding of how to not over- or undercompensate for demand. FashWire, a Seattle-based shopping app founded in 2018, aims to do that by gamifying the shopping experience for the customer. Users can discover clothing and accessories from more than 400 global brands and designers and vote on whether they like them or not with buttons. The data pulled from these user interactions is shared with the designers on the site, who use it to better understand customer preferences, allowing them to drive conversion on their own websites.
- Making shopping more personal. Shopping fatigue is something that 52-year-old Julie Bornstein, founder and CEO of San Francisco-based shopping app The Yes, has personally felt. The e-commerce veteran founded her company in 2018 to help customers find the clothing they actually want without having to sift through pages and pages of search results. Users take a style quiz when they sign up to the platform, and the more they interact with the platform, the better it understands their style, thanks to machine learning. The Yes features items from hundreds of contemporary brands, and only shows users items that are available in their size, among other qualitative characteristics. Basically, it results in a highly personal shopping experience.
- Creating a more circular fashion system. Most people tend to wear a small fraction of their closet, says Nicole Kobilansky, 36, CEO and co-founder of the San Francisco-based fashion app Storey. When she launched the app in 2021, her goal was to get people to rediscover the clothing and accessories they already own, while simultaneously making it easier for them to resell items they’re ready to part with. Users create digital versions of their wardrobes by manually uploading photos of items or using the app’s artificial intelligence capabilities to scan their email for online clothing purchases. From there, they can collage outfits, resell items, and post outfit photos, in which items are automatically tagged–giving users valuable data on which items of clothing they wear the most frequently.
2 key takeaways from the article
- Shopping for clothes is starting to look very different than it used to. The pandemic has accelerated the adoption of e-commerce which is likely be propelled by innovations that help consumers shop smarter, more sustainably, and in a more personalized way.
- Four ways that companies are already transforming the fashion world through new digital developments are: enabling virtual try-ons, helping brands assess demand, making shopping more personal, and creating a more circular fashion system.
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Topics: Fashion Industry, Customers Experiences, Technology, e-commerce
Leading & Managing Section
Make Resilience Your Company’s Strategic Advantage
By Martin Reeves et al., | Harvard Business Review | March 25, 2022
Over the last few years, business leaders have been reminded repeatedly of the interconnectedness and unpredictability of businesses, economies, and societies. Humanitarian disasters, from the pandemic to the war in Ukraine, have created shockwaves affecting geopolitics, economics, trade, energy, and financial markets. Business reputations, markets, supply chains, and employees have been impacted in unpredicted ways. It’s not surprising then that resilience — the ability to thrive under change — has risen to the top of many leaders’ agenda. As we saw with Covid-19, more resilient businesses had better outcomes, and some even emerged as new winners.
Yet, history tells us that companies often lose interest in resilience as crises fade. Few companies have systematically codified lessons learned and baked resilience into their organizations. This is because too many organizations hold a narrow view of resilience as mainly ensuring short-term, operational continuity during crises. True resilience is more expansive: It’s a company’s capacity to absorb stress, recover critical functionality, and thrive in new circumstances. Resilience is not merely an operational consideration — it’s a potential strategic advantage that enables companies to capitalize on opportunities when competitors are least prepared. In order to build truly resilient organizations, leaders first must understand five myths that may be holding them back.
- Resilience is mainly a supply chain issue. Reality is resilience is essential in all key organizational functions.
- Resilience is synonymous with risk mitigation. Reality is resilience is as much about enabling of upside as protecting against downside risks.
- Resilience is mainly an operational consideration.
- Resilience is a cost to the business. Reality is resilience is a driver of value.
- Crises are too infrequent and unique to warrant investment in resilience. Reality is companies need resilience to navigate an increasingly volatile world.
In order to build systematic resilience into their organizations, leaders must take seven critical actions: adopt an expanded view of resilience; recognize and address the tradeoff between long-term resilience and short-term efficiency; shift your mindset; measure resilience; operationalize resilience; model leadership behaviors; and contribute to improving the resilience of the societal systems on which your businesses depends.
3 key takeaways from the article
- Resilience — the ability to thrive under change — has risen to the top of many leaders’ agenda as an outcome of uncertainties such as Covid-19.
- Leaders first must understand five myths that may be holding them back: resilience is mainly a supply chain issue; resilience is synonymous with risk mitigation; resilience is mainly an operational consideration; resilience is a cost to the business; and crises are too infrequent and unique to warrant investment in resilience.
- In order to build systematic resilience into their organizations, leaders must take seven critical actions: adopt an expanded view of resilience; recognize and address the tradeoff between long-term resilience and short-term efficiency; shift your mindset; measure resilience; operationalize resilience; model leadership behaviors; and contribute to improving the resilience of the societal systems on which your businesses depends.
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Topics: Resilience, Leadership, Uncertainty, Decision-making
Leading Change Means Changing How You Lead
By B. Tom Hunsaker and Jonathan Knowles | MIT Sloan Management Review | March 21, 2022
It would be easy to conclude — as many commentators have — that the key requirements of leadership are flexibility and empathy. While these qualities are certainly beneficial, especially at this specific, stressful moment, the enduring requirement of leadership is to be contextually effective. Effective leaders are those who adjust their leadership approach to suit the context and challenges they face.
History is replete with examples of individuals who displayed extraordinary leadership under certain circumstances but were unable or unwilling to subsequently change their leadership approach. In business, it is frequently observed that a founder is rarely the leader best suited to run the business once it achieves a certain scale because it requires a different style of leadership and skills. In their work with leaders, the authors encourage them to think of contextual effectiveness as comprising three main tasks:
Drawing the map: The late publisher Arnold Glasgow observed that great leaders recognize an issue before it becomes an emergency. They consistently map the changing dynamics of the company’s environment and create a clear, prioritized vision for where the business should be headed.
Establishing the mindset: The second task of leadership is to ensure that the executive team has more than just a cognitive understanding of the map. The leader’s mindset drives a shared conviction about the necessity of change and an enthusiasm for the improvements that successful change will bring about. This enthusiasm is vital because achieving change is harder than maintaining the status quo.
Communicating the message: If the map credibly identifies the needed change, and the mindset creates the appetite for change, the message is the key tool for activating that change among the broader population of employees. The leader’s message serves as the rallying cry that aligns the energies of the organization around a particular goal and the attitudes and behaviors required to achieve it.
Defining the map, mindset, and message are the core tasks of leading change, but the objective of each task will vary according to the type of change that the leader is seeking to achieve. Change takes three distinct forms: enhancing the magnitude of the company’s current strategy, reimagining the activities for pursuing that strategy and shifting direction altogether. The authors share how the objective of the “map, mindset, and message” tasks varies according to the type of change that the leader is trying to achieve.
3 key takeaways from the article
- Effective leaders are those who adjust their leadership approach to suit the context and challenges they face.
- Contextual effectiveness comprises three main tasks: drawing the map, establishing the mindset, and communicating the message.
- Defining the map, mindset, and message are the core tasks of leading change, but the objective of each task will vary according to the type of change i.e., enhancing magnitude, shifting direction, and reimagine the activities that the leader is seeking to achieve.
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Topics: Leadership, Organizational Behavior, Culture, Organizational Performance
Understanding Customers’ Experiences
Six customer experience pitfalls to avoid
By Itai Miller et al., | McKinsey & Company | March 17, 2022
In recent years, organizations across sectors have been forced to overhaul many of their processes as the importance of CX has taken center stage. For companies to succeed—and outperform their peers—in this environment of constant change, a culture of customer-centricity is critical. Building the right organizational capabilities and culture to plan, execute, and sustain the transformation is the first in ‘to-do’ list. Programs to build capabilities and change culture are key to changing an organization’s core. Without them, companies may succumb to any number of potential pitfalls that will undermine their goals. Six as the most common are:
- Failure to link CX to value. Many customer-experience transformations stall because senior leaders fail to directly link the efforts with strategic priorities, such as revenue growth by product or geography. Without clearly showing how a better experience will drive increased customer satisfaction, loyalty, and attraction, and thereby better business results, the effort is likely to seem frivolous and to lose executive sponsorship.
- Fragmentation. Some customer experience leaders lose precious time by trying to fix everything at once. A proliferation of small, siloed initiatives that lack focus dilutes impact, resulting in incremental change, at best.
- Solving for touchpoints. Many companies fall into the trap of solving issues around individual touchpoints instead of considering customer experience the way customers do, that is, looking across the entire journey a customer takes to achieve a goal.
- Limited creativity. Many companies struggle to systematically come up with bold, innovative solutions for customer challenges and to bolster a culture that encourages such creative thinking. It’s not uncommon for a business to reject new ideas because “We have tried that before,” or “That’s not how we do things,” or “We’ll never get the funding for that.” That kind of thinking causes employees to limit their creativity to safe, incremental improvements.
- Sidelining customers upfront. Failure to seek feedback out of a desire to save time can keep companies from testing solutions with customers, and seeking it too late to make real changes can lead to inferior products and lackluster financial results.
- CX on its own island. Ensuring an excellent customer experience requires a cross-functional mindset and a customer-centric culture. It is not just the CX team that drives customer experience, nor is it just the customer-facing front line. Looking deeply at a customer journey reveals that many employees, even those who will never see a customer, affect it.
3 key takeaways from the article
- In recent years, organizations across sectors have been forced to overhaul many of their processes as the importance of CX has taken center stage.
- For companies to succeed—and outperform their peers—in this environment of constant change, a culture of customer-centricity is critical.
- Building the right organizational capabilities and culture to plan, execute, and sustain the transformation is the first in ‘to-do’ list. Programs to build capabilities and change culture are key to changing an organization’s core. Without them, companies may succumb to any number of potential pitfalls that will undermine their goals. Six as the most common are: failure to link CX to value, fragmentation, solving for the touch-points, limited creativity, sidelining customers upfront, and CX on its own island.
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Topics: Marketing, Customers’ Experiences, Creativity
Entrepreneurship
3 Tips To Help You Launch A Business Built To Last
By Rhett Power | Forbes Magazine | March 27, 2021
Making the decision to start a business comes with plenty of emotions. Perhaps the biggest one is a sense of fear, thanks to all the unknowns. What if people don’t want your product? What if your sales tactics don’t resonate with buyers? What if you run out of cash? And, of course, the biggest what-if of all: What if you fail? These fears are understandable, but you don’t have to say goodbye to your dreams just because you can’t see into the future. Of course, you still need to act with care, thoughtfulness, and rationality. That’s where listening to others’ advice comes in handy. Three of such advice are:
Metamorphose into a social butterfly. When you’re knee-deep in the beginnings of a business, you may find yourself tempted to lead a relatively solitary existence. After all, keeping your nose to the grindstone will make your company survive and thrive, right? Not necessarily. Networking is an essential part of starting and maintaining a successful business. By attending events regularly, you can meet potential clients, partners, and investors, and you might pick up some valuable advice from other entrepreneurs along the way.
Diversify your funding sources. Running out of cash or failing to raise new capital are the top reasons startups fail. Setting yourself up with several funding sources rather than focusing on one will be important for long-term success. For instance, you may want to use a combination of investment sources, so you aren’t reliant on one stream of cash.
Bolster your online presence. In an article for Entrepreneurs’ Organization, branding specialist Marina Byezhanova wrote about how people tend to be more interested in the person running a company than their actual brand. Shote notes that in one case, a founder’s personal LinkedIn had 20 times the following of her brand’s profile. Essentially, this boils down to a simple truth: People like doing business with people. Period. As the head of your organization, you need to make yourself the face and voice that drives your company forward online.
3 key takeaways from the article
- Making the decision to start a business comes with plenty of emotions. Perhaps the biggest one is a sense of fear, thanks to all the unknowns. What if people don’t want your product? What if your sales tactics don’t resonate with buyers? What if you run out of cash? And, of course, the biggest what-if of all: What if you fail?
- These fears are understandable, but you don’t have to say goodbye to your dreams just because you can’t see into the future.
- Of course, you still need to act with care, thoughtfulness, and rationality. That’s where listening to others’ advice comes in handy. Three of such advice are: focus on networking, diversify your financial resources, and bolster your online presence.
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Topics: Startup, Entrepreneurship, Risk-taking
How to Form a Clear Voice and Tone for Your Brand
By Julia McCoy | Entrepreneur Magazine | March 23, 2022
Your brand voice is going to be your golden ticket to creating an authentic connection with your audience and generating a river of new sales. But first, you must find it. What is brand voice and how can you find your own? Five steps can help you.
- Look at brand voice and tone examples. You should look at other brand voice and personality examples before you start defining your own. To do this, jot down a handful of your favorite brands and companies and their brand voice characteristics.
- Fill out a brand voice worksheet. You can complete some simple brand voice exercises to help form your tone. This will help you explore your target audience more deeply, define your competitor’s brand voice and start to uncover the direction of your own brand’s tone.
- Write down your brand voice characteristics. Up next, you’re going to drill down your answers and define your brand voice and tone. To do this, take a look at the words you wrote down on your worksheet for inspiration. What’s the immediate vibe you get from looking at your answers. Fun? Serious? Inspiring? Hopeful? Young? Direct? Pulling inspiration directly from the words you wrote down is a great start. But you’ll need to get a little more existential with your thoughts around your business. So next, ask yourself: Which of your brand’s big truths connects the most with your ideal customer?
- Create brand voice guidelines and share them. How do you create brand voice guidelines? First, make sure that everyone can access your brand voice characteristics and details in a shareable document. That way, your entire team knows where to go to reference your brand tone when planning, writing and editing content. Make sure to include a section with similar brand voice examples so your team can get a tangible feel for what you’re imagining (screenshots work great). Then, make your voice brand guidelines thorough.
- Be consistent with your brand tone. If you’ve made it this far, you’ve put in a ton of work finding your brand voice and tone. Don’t let it go to waste. It’s now time to create a documented and sustainable business strategy. A plan that includes details on how to keep tone consistent across everything your business publishes.
3 key takeaways from the article
- There comes a time as an entrepreneur where you’ll end up wondering how to form your brand voice and tone. Especially when we know how important earning consumer trust has become.
- Your brand voice is going to be your golden ticket to creating an authentic connection with your audience and generating a river of new sales. But first, you must find it. What is brand voice and how can you find your own?
- Five steps can help you: look at brand voice and tone examples, fill out a brand voice worksheet, write down your brand voice characteristics, create brand voice guidelines and share them, and be consistent with your brand tone.
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Topics: Marketing, Branding, Communication
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