Corporate Strategy

Awareness of the company that his fate depends also on the environment and the community about the rise of late. Therefore, we can also read the news more often about the increasing efforts that include a corporate social responsibility (CSR).

In the country we can see efforts such as Telkom who donated computers and Internet connections to assist in the villages, the Sampoerna diligently to provide scholarships, or Unilever products through the development Lifebouy help higenis a toilet in the villages. Anyone who do these things, and whatever they do, we give them worthy of praise. We also expect more companies to follow them.

Unfortunately, most companies still view CSR as part of the cost or reactive measures to anticipate rejection and community environment. Some companies are able to raise the status of CSR to a higher level with the making as part of efforts to increase brand building and corporate image. However, efforts CSR is still a rarely used as part of a strategic planning company.


CSR and corporate strategy? Sounds second it mutually incompatible. Milton Friedman, the Nobel Prize winning economist, even pout efforts to make the company as a tool for social purposes. Corporate goal, according to him, only generate economic benefits for shareholders. Of course, Friedman's considered opinion increasingly outdated. However, creating synergies between CSR and corporate strategy is not something that is also prevalent.

Fortunately only a few large companies and academic circles, including Michael Porter, Clayton Christensen, and Rosabeth Moss Kanter (third from the Harvard Business School), has proven successful programs CSR disinergikan with the company's strategy will provide a far more impact to the community and large companies itself compared to the efforts of CSR ala measure. According to them, only with the CSR as part of corporate strategy, CSR programs can be eternal. Because the company's strategy is closely related to the CSR program, the company will not remove the program even though the CSR was a crisis, unless you want to change the fundamental strategy. While in cases of CSR in general, so the company was a crisis, the CSR program will be cut first.

An example of a very interesting case is that Nestle to help the breeder cow in India. Before Nestle into India, the farmers who have difficult access to clean water channels, the land fertile, and other infrastructures that support should be satisfied with the life-cow beef lean and short. When Nestle into India, the company quickly realized for the supply of pure milk is sufficient, they need to help the breeder's. Thus, the CSR program diluncurkanlah massive.

Nestle established centers with milk storage engine cooling in some places. In addition, periodically, the car that brought the Nestle veterinarian, nutrition experts, agriculture experts, and experts come to the quality of the breeder. Financial and technical assistance are also provided to help the cattle farmers dig wells and improve the well-irrigation system. The result? When Nestle was first launched this program, only 180 local breeder who participate. Nestle now have to handle about 75,000 cattle farmers. Milk production increased by 50 per breeder times, and the standard of living of the breeder took much improved.

An example is the hotel group Marriott International, which provides job training to the unemployed heavyweight. This program is run in a dozen cities in the U.S.. Marriott promising trainees work remains if they successfully pass. This program was not only to help the unemployed and the local community, but also Marriott. Why? In fact received the unemployment of more loyal to the company.

Company information-technology companies such as Cisco and Microsoft also does not lag. Cisco to provide free training on them-they are talented but can not afford to obtain certification from Cisco. Microsoft to assist schools in developing countries (including Australia) in the computer design curriculum subjects. When the students have graduated, their skills can be used to support products that are produced by two companies.

That's some examples of successful companies in the strategy and coordinate their CSR program. They not only succeeded in helping the environment and local communities, but also the company itself. Synergies between the two was very possible. If we want to complete the social problems, may be the main key is located on the involvement of the corporate sector at this time because of the strength of the corporation has exceeded the power of government and other institutions. Which is the main problem is how difficult it is to change the mindset for this purpose the company and see each other for behind CSR.

Who is your company said this challenge?

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Information Technology : New Business Opportunities

The world of information technology doesn't necessarily offer bigger and better opportunities than old-fashioned games like fast food. But IT is spawning more opportunities faster than any other business - and technological whiz-kids aren't the only ones making millions.

You can't control a twinge of envy when a company like Maid, previously little known, sees its shares double in a week - thanks to a deal to provide Microsoft's Internet services with business information. But envy's the wrong response. Try emulation instead.

The world of information technology doesn't necessarily offer bigger and better opportunities than old-fashioned games like fast food. But for small firms IT is spawning more business opportunities faster than any other industry - and technological whiz-kids aren't the only ones making millions.

To join them, though, the best route is to work for an existing IT company or join forces with someone who does. Time and again, the large employer either ignores an employee's bright idea or, even worse, alienates key workers by putting a stop to their key work.


IBM, for spectacular example, decided that its Mannheim unit in Germany should stop work on software that organises tasks across large corporations. Furious at losing their baby to another part of IBM, five engineers stomped out and started SAP. It has sold $4 billion of software since 1972, and leads the US market.

As for turning up noses at bright ideas, an established mainframe software company wasn't at all interested in Dave Duffield's plan to make 'client-server' networks (which link PCs) easy to use for basic business functions. After going public in 1992, five years after foundation, PeopleSoft has made Duffield worth more than $400 million.

The first rule for joining the hi-tech race, then, is the same as for any entrepreneurial venture. Back your own judgment. The next best course is to back somebody else who has that faith. One businessman who wisely joined a whiz-kid is now worth $29 million - although the company, UUNet, lost $7 million in its latest year.

Like SAP and PeopleSoft, UUNet features in a fascinating Fortune survey of up-and-coming (sometimes just arrived) IT companies with gee-whiz names like Tenth Planet and Humongous Entertainment (educational software), Digital Domain (special effects for films) and On Ramp. The last, founded by another big company escapee, designs Internet content - and the Internet (see Maid) is the hottest current scene.

The heat won' t last, though; money-losing companies won't go on making 23 millionaires overnight through dizzy stock market ratings. The Internet is attracting over-excited attention because the potential market is immense. Yet other markets are just as large which aren't in cyberspace, but down to earth: like management meetings.

The estimated 45 million meetings held every week matches the Net for potential users. So a company, Proxima, which makes overhead projectors fed straight from a PC, has the right idea. Look for very large markets where technology can provide an advantage that you would value highly yourself. The best entrepreneurs are their own greatest fans.

In high-tech, though, it helps if the next greatest fans are very large, rich companies. The Microsoft connection which made Maid is an example. Look through the ranks of IT stars, and other giants like IBM and AT&T crop up as early customers or even backers. Knocking on big company doors is therefore another wise move.

In fact, their doors may open more readily than those of the venture capitalists who are popularly supposed to support start-ups. The venturers, however, mostly pulled back after some bitter losses. That's a constant fear with new technologies - that promised wonders will never materialise, or will disappoint.

The fear is never shared by IT entrepreneurs, which is the right attitude. It needs to be tempered by realism. That's why taking in a partner with wide business experience is an excellent idea. These firms can grow so fast - doubling every year, say - that there isn't time to learn management on the job.

But you also need to keep the system free-and-easy, like one Internet entrepreneur who has only three rules for his 80 employees: Do what you're hired for. Do some personal development. Do some office task. The idea is to keep an adaptable culture so that your people won't join the breakaway ranks. The biggest single source of new whiz-companies seems to be Apple - which was once a whizzing breakaway itself.

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SWOT: Assess the strengths, weaknesses, opportunities and threats of your business with SWOT Analysis

How far is my company away from failure? The question itself sounds like an admission of inadequacy. The confident manager surely doesn't walk around waiting for nemesis to strike. Rather, confident people strut the stage like a colossus, with all the certainty, say, of Bill Gates. The question, though, was inspired by Gates, who observed that 'Microsoft is always just two years away from failure.' This wasn't self-deprecation, but sober analysis.

One of management's trustiest tools is the SWOT analysis. You take a calm, cool look at the organisation's Strengths, Weaknesses, Opportunities and Threats. Then you seek to capitalise on the Strengths, Eliminate the Weaknesses, seize the best Opportunities and counter the Threats. Could the magnificent success of Microsoft, with its 90% gross margin and $9 billion of cash, really be threatened? In a brilliant study in Worldlink magazine, Howard Anderson has shown that the answer is Yes - a dozen times over. Although the threats are specific to the software industry, they are also generic.

Try them on your own firm:

1. Could newcomers (including breakaways from your own company) create damaging competition?
2. Is there an equally powerful force in the market which could muscle into your territory?
3. Is there a rival technology or other differentiator which could come out on top?
4. Are you weak compared to the competition in a key market segment?
5. Is the market developing in ways that favour competitors more than you?
6. Could your customers takes major sources of revenue away?
7. Is there a major area in the market where you lag rather than lead?
8. Does a competitor have a stronger hold on your biggest customers?
9. Is there a growing market where you are being left behind?
10. Are there environmental/regulatory threats?
11. Could unsuspected challenge arrive from outside the existing industry?
12. Is your market too broad for all threats to be safely covered?

AN INTIMIDATING LIST

The thirteenth question, of course, is whether, if any of the dozen apply to your business, you are doing anything effective to counter the Threat or, better still, to convert Threat into true Opportunity. It's an intimidating list, even for mighty Microsoft, especially when you see the names of its leading enemies: Sun Microsystems, the big banks, Cisco, Compaq, Netscape, Oracle, SAP and IBM. The latter giant provides Anderson with his starting point. Could what happened to IBM afflict Microsoft? His company, The Yankee Group, had been deeply impressed by the Strengths deployed by IBM in 1982 - and not surprisingly.

IBM led in every important market of the time: mainframes, communications, mainframe storage, mincomputers, and personal computers. It earned more profit than the next nine computer firms generated in total sales, spending more on R&D than they made in earnings. The Yankee Group concluded that IBM was therefore invulnerable - yet the giant was about to embark on a prolonged slide that, amazingly, leaves its market value lagging behind both Microsoft and Intel, and by no small margin, either. IBM's $86 billion of mid-1997 market capitalisation compares to $149 billion for Microsoft and $124 billion for Intel: IBM should plainly have held on to its old strategic investment in the latter. How could the Yankee Group's assessment be so spectacularly wrong?

In the first place, never concentrate just on your own or anybody else's Strengths. That's highly dangerous, partly because they can so easily turn into Weaknesses. Thus IBM's domination of mainframes, and dependence on them for the bulk of its profits, became an incubus as the market moved away to the PCs from which Intel and Microsoft drew their super-growth. The latter's similar domination and dependence in PC operating systems almost moved from Strength to Weakness as the Internet took off - and Gates was much nearer than his 'two years away from failure' when, with a mighty effort, he reversed engines and poured billions into Net, software probably just in time.

Second, market share and leadership by size are not strongpoints in themselves. In PCs, Compaq was able to exploit a world share of around 3% far more effectively than IBM, which had three times the market. The issue is how the market share, whether leading or not, has been achieved and sustained. Is the product or service perceived as superior? Is it cheaper? Is the distribution more effective? Is the cost level lower? Is speed-to-market faster? Are customer requirements met more accurately?

REACTION IN CRISIS

In the case of Compaq v IBM, curiously enough, the answers were all negative. Compaq had no significant advantage in product, distribution, costs, price, speed-to-market or customer satisfaction. But in the money-losing crisis into which Compaq suddenly plunged, it reacted radically on every point to create a stronger platform than its rival. The cost ratio, for instance, came down from 31% to 12.5% - an astonishing performance - as new products were launched at high speed, and the premium price policy was abandoned in favour of leading price levels downwards.

The key Strengths at Compaq were therefore intangibles, as were the Weaknesses at IBM. The smaller company was able to react and reform at speed; the larger could only react slowly and reluctantly. So the Yankee Group's second error was to concentrate on static Strengths, which are the results of past performance, rather than analysing the factors which will govern performance in the future. Even IBM's massively higher R&D spending was irrelevant in this context - the quantum of expenditure was less important than the uses to which its results were being put. The Yankee research consequently missed the low rate of conversion of R&D into saleable products - clearly shown, for example, by the strange RISC saga.

IBM's discovery of Reduced Instruction Set Computing, primarily the work of a technologist named John Cooke, was potentially a big winner, since it much enhances the performance of smaller computers. IBM, though, didn't use its own discovery in a work-station until 1990 - three years after Sun Microsystems and twice as long after RISC's availability. How could such absurdity be allowed? The explanation is that RISC was resisted by people who were dedicated to extending the 360-370 mainframe architecture. That's a perfect (or imperfect) example of how Strength turns into Weakness. Exactly the same mindset also allowed Compaq to seize the advantage, and a market share of nearly one third. in client-servers, powerful PCs which serve networks.

The resilience which IBM's rivals have shown, compared to their opponent's fateful conservatism, rests on people. In any industry today, the brighest and best employees are aware that their own SWOT analysis could lead to breakaway. They could stay with the company and develop their ideas within its embrace. But fragmented markets and booming stock prices, coupled with increasingly plentiful venture capital, offer a constant temptation.

Keeping people one by one, buying them off, so to speak, is no solution. The company has to create a culture that's so attractive, so hard to leave, that the retention rate will remain very high. In other words, Putting People First has to be the base strategy. An unhappy workforce is both a Weakness and a Threat - as British Airways has recently found. Its resurgence was founded on a programme actually called Putting People First - but, after a pilots' strike threat last year, in late June cabin crew and ground staff were equally alienated.

Look at what Fortune magazine calls the 'four-pronged approach' adopted by chief executive Bob Ayling, and the missing element is immediately obvious:

1. Develop a marketing plan with universal appeal
2. Help employees understand the company's global vision
3. Benchmark off mistakes that others have made in the past
4. Select the right partners for joint ventures overseas.

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Microsoft Management

Bill Gates and the management of Microsoft are synonymous. Gates founded the corporation and the Microsoft management philosophy that he implemented, as well as the Microsoft corporate strategy, helped the company become the the global leader in personal computer software and systems.

The Microsoft business structure is vast and over 71,000 people are employed in 103 countries and regions. The Microsoft leadership style was established by Gates himself and CEO Steve Ballmer, and both have been responsible for Microsoft planning strategy.

Microsoft's Mission

To enable people and businesses throughout the world to realize their full potential.

Microsoft's Vision

Empowering people through great software — any time, any place, and on any device.

Delivering Microsoft Mission

The tenets central to accomplishing Microsoft mission include :

Broad Customer Connection
Connecting with customers, understanding their needs and how they use technology, and providing value through information and support to help them realize their potential.

A Global, Inclusive Approach
Thinking and acting globally, enabling a multicultural workforce that generates innovative decision-making for a diverse universe of customers and partners, innovating to lower the costs of technology, and showing leadership in supporting the communities in which we work and live.

Excellence
In everything we do.

Trustworthy Computing
Deepening customer trust through the quality of our products and services, our responsiveness and accountability, and our predictability in everything we do.

Innovative and Responsible Platform Leadership
Expanding platform innovation, benefits, and opportunities for customers and partners; openness in discussing our future directions; getting feedback; and working with others to ensure that their products and our platforms work well together.

Enabling People to Do New Things
Broadening choices for customers by identifying new areas of business; incubating new products; integrating new customer scenarios into existing businesses; exploring acquisitions of key talent and experience; and integrating more deeply with new and existing partners.

To read more about Microsoft's corporate strategy and Microsoft quality management, click on the articles listed below.

1. SWOT: Assess the strengths, weaknesses, opportunities and threats of your business with SWOT Analysis
   
2. Information Technology : New Business Opportunities

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