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Posts By Rita McGrath

Fascinating study on R&D Spending and return on innovation by Booz Allen & Hamilton

My colleague, Gray Hammond, drew attention to this year’s installment of the fascinating study of innovation conducted annually by Booz Allen and Hamilton. To access the study click here Synopsis: Booz Allen Hamilton’s annual study of the world’s largest corporate R&D spenders finds two primary success factors: aligning the innovation model to corporate strategy and listening to customers every step of the way. They have also identified three types of... read more »

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Overcoming resistance - Monsanto’s stealth strategy

In the book MarketBusters, we strongly encourage would-be growth companies to give some careful thought to the forces that might lead to delay or resistance as the new initiatives are rolled out.  One of our poster children for this was Mosanto, whose genetically modified seeds created a firestorm of opposition, particularly in Europe, as the products were launched.  In 2002, the company’s stock price dropped by 50% and it announced... read more »

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Here’s a scary statistic - consumer debt on revolving credit

For years, it has bugged me that there seems to be no political will to set up rules that would keep people from getting in over their heads on credit card debt, or that would prevent financial institutions from charging them usurious interest rates once they got there.  Perhaps we’re now reaching some tipping point after which there will be momentum to provide some basic boundaries for this business.  Business... read more »

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Incredible shrinking economies

My colleague, Michael Schrage of MIT sent along a fascinating editorial story from the New York Times in which an observer notes that projections for the size, wealth and growth rates of emerging economies – specifically India and China – are way off.  With the projections actually much smaller, the attractiveness and wealth of those markets appears to be exaggerated.  This will be quite a blow to the growth strategies... read more »

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Real Leading Indicators in Retail

When it comes to information that is used to make managerial decisions, it’s useful to think of it in terms of three timeframes:  Lagging indicators (which are the bulk of those in use) reflect past events – you can’t change them.  Current indicators tell you where you are.  The most valuable, and often the least used are leading indicators – information that tells you where you’re likely to be going. ... read more »

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Business Model Change as an industry sector evolves

Both Clayton Christensen and Geoffrey Moore have noted that players exploiting different business models are advantaged in different stages of a categories’ evolution.  I’ve build on their thinking to argue the following: Stage I categories:  Most offerings aren’t yet good enough, interfaces aren’t standardized, and a strong hand needs to be exerted on value chain players to ensure that customers and end users have an acceptable experience.  Current examples would... read more »

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Is your company unintentionally creating executive blind spots?

One of the nice things about being a very senior executive with a multinational company is that the job comes with perks.  Sometimes, however, these perks can have the unintended effect of isolating key decision-makers from the very information they need most.  Example:  For decades, the top executives at America’s leading automobile manufacturers always drove the latest models—washed, maintained, and looked after by in-company employees.  How on earth could they... read more »

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Consumption Chain - customers value a complete experience, but companies organize otherwise

A short recent piece in Fast Company highlights a point that I make over and over again in our executive programs and with clients:  customers value a complete experience, while companies organize themselves by a different logic, often one that has to do with efficiencies.  The article (September, 2007 edition, page 27) features a senior leader at GE trying to sell to the Olympic organizing committee of the Beijing Olympics. ... read more »

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Critical Success Factors for Corporate Ventures

This week, I’m directing the Columbia Business School Executive Education course Leading Strategic Growth and Change.  The course is designed to help companies learn to better manage opportunities for growth through innovation, new product development and venturing.  This weeks’ course has been fantastic so far, with a veritable United Nations of participants.  In fact, we have folks here from every continent (except Antarctica!).  Today’s presenter is Ron Pierantozzi, who was... read more »

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Making passengers smile at Zurich International Airport - the power of small differentiators

Here I am in Switzerland, working with one of Columbia’s best clients, Swiss Reinsurance.  We run a program called “Creating Breakthrough Strategies” for their most senior executives, and it’s always a highlight. I was struck once again upon arriving at Zurich Airport how often simple little things can create a differentiated experience for customers.  In this case, when one takes a train from the “E” terminals (which are remote) to... read more »

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Columbia Business School offers one of the best “spare time” B Schools in Business Week

Business Week has just published its highly influential rankings of executive MBA and Executive Education programs, and I’m pleased and proud to note that Columbia has not only done well, but improved its position considerably in both.  In his first year as Associate Dean of our executive education offerings, Troy Eggers has led a strong upswing in our position.  For non-degree executive education offerings, Columbia ranked #5 for Open Enrollment... read more »

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So now CEO’s have to create value? How novel!

It was fascinating to read in this week’s Business Week that as easy money has evaporated in the world of private equity, that the CEO’s of these firms have to resort to the traditional practice of management – “making the companies they control more profitable” as the magazine says (November 5, 2007 issue, page 40).  Astonishing.  And perhaps gratifying, as we see evidence that the folks with purely financial know-how... read more »

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Managing your boss

I’m here in Japan in a program that Columbia runs in partnership with the Japan Bank for International Cooperation (JBIC).  One of the topics we’re working on has to do with managing your boss – a perennial favorite.  Here is the gist of what we covered (with credit to my colleague, Bill Klepper): The essence of the process is to follow these steps: #1:  Get some insight into your own... read more »

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Competing with your customers as you grow

A conversation taking place among colleagues over at the Kellogg innovation blog/web forum (http://marketdrivengrowth.blogspot.com) has to do with how you can move into spaces that are occupied to some extent by your customers,with the goal of making the whole pie larger for everyone.  The dilemma is that customers can mistrust your motives, but at the same time you need them to get whole ecosystems going or to develop certain kinds... read more »

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GPS Technology to end car crashes

Wired magazine features an innovative use of new GPS technology that I thought could be the harbinger of all kinds of opportunities.  The system is called “StarChase Pursuit Management System” and it works like this:  When a police officer is chasing a suspect’s car, they can launch a laser-sighted homing device with a GPS tracking transmitter from a sort of cannon.  The transmitter attaches itself to the fleeing vehicle, and... read more »

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