The importance of critical conversations
Yesterday, I was delighted to be a guest at a World 50 event for very senior executives. The organizations creates a forum in which people can have honest, open dialogues and share best practices. The day looked at how difficult it is to anticipate massive changes that can affect entire industry segments. Among the conclusions was that having honest, candid conversations with people who have insight into the future is a key issue for senior executives. Those conversations, unfortunately, often don't take place until the situations is truly dire.
The topic of critical conversations was one I raised in a recent Long Range Planning article on business models. It caught the eye of consultant Matt Stocker, who blogged about the idea as well.
The core concept is to make sure that you are continuously exposed to people with a different perspective than your own, people who are either experts in technologies, new markets, or transformations that could potentially be disruptive to your business so that you pick up the early warning signals quickly.
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- Posted Rita McGrath on April 11, 2012
Groupon: Didn’t like it before, don’t like it much better now
I have gone on the record as being dubious about Groupon's business model for some time now. Indeed, in an article published in the European Financial Review, I suggested that a simple diagnostic quiz could reveal some of the weaknesses in its business proposition, including the fact that the stickiness which great business models create for companies with their customers doesn't seem to be there with Groupon. There is also mounting evidence that for many of the small businesses it targets with traffic-building promises, the concept just doesn't deliver.
But never mind me, the company went on and went public anyway. The trouble with being a public company is that it immediately puts you under glaring headlights as far as performance is concerned. So I suppose it wasn't all that surprising that a Wall Street Journal article entitled "Groupon's Growing Pains" began this way:
Groupon Inc. went public on the promise of fast growth and future profits. But on Wednesday, some of those promises remained elusive.
In its first major test since an initial public offering in November, the Chicago-based daily deals site reported revenue more than doubled to $506.5 million in the fourth quarter, strengthened by new products, holiday sales and a rise in the rate it takes from merchants.
The company has yet to prove to investors that its business of offering coupons to local business is profitable. Groupon reported a loss of $37 million in the quarter...
One quarter down - I guess we'll see how many more to go.
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- Posted Rita McGrath on February 10, 2012
What are we to use to replace industry analysis in strategy?
In my blog over at the Harvard business review web site, I noted that industry boundaries are blurring and that this can lead to serious strategy miscalculations. Several people wrote in to say that they thought the 'jobs to be done' perspective offered a better vantage point. Couldn't agree more!
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- Posted Rita McGrath on January 19, 2012
Rita Gunther McGrath one of the world’s top 20 business thinkers
The global management list of leading thinkers has just been released, and I'm happy to share that I am one of the top 20 on the list.
You can see the list, images of the swanky awards dinner and other images at this link.
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- Posted Rita McGrath on November 15, 2011
Still not liking Groupon’s business model a whole lot…
In a post over at the HBR site, I note that Groupon's business model continues to be problematic. In response, I received some updated news from Sander Daniels, who runs a site called Thumbtack that acts as kind of a clearinghouse for daily deals. Here's what they found:
We reviewed 10 daily deals offered by Groupon and Livingsocial, and the "regular" prices quoted by Groupon and Livingsocial were higher in 8 of the 10 cases than the prices quoted by the same merchants when we called them.
This seems like deceptive marketing to consumers, no matter whether it's the small businesses, the daily deal sites, or some combination of the two that is causing this price inflation.
To read the full report, follow this link:
http://www.thumbtack.com/blog/case-study-are-daily-deal-discounts-inflated/
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- Posted Rita McGrath on October 13, 2011
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