19th June 2018
Knitting as a Strategy – Farida Gibbs
The waning decades of the last century were the glory days of the conglomerates – ITT, WR Grace, General Electric among others. Investor Christer Cardell now says, “I think it’s the end of conglomerates. …those classic conglomerates are falling apart. It’s an old-fashioned structure that is getting increasingly difficult to manage.” It never made much sense to have, for example, brewing, shipping and asbestos under one roof.
Management consultant Tom Peters exhorted companies to ‘stick to the knitting’ and the era of diversification was upon us.
So the question now is, what’s the “knitting” Peters refers to? Companies define it differently, the broader definition allowing for a more intelligent strategy – Ford Motor Company, for example, defines itself as an automotive and mobility leader. This allows it to be not just in cars, but in driverless taxis, dashboard software, road technology, sustainable fuels and so on. BT has gone way beyond plain old telephone service (POTS), and now offers customers broadband, tv, mobile communications and even, if you insist, landlines.
Why? Because customers want the convenience of the one-stop.
Banks offer many value-added services on top of looking after your money. Travel insurance, mortgages, shopping discount packages, pension advice – it’s all there. They can do this not just because they have significant buying power and can offer benefits, but because people by and large trust banks with their assets and loyalty. While a customer may buy milk and Mars bars at the corner shop, it’s unlikely they would buy a pension plan at the same shop. They give the bank, however, permission to offer a wide range of finance-related products.
Inside our company we have long discussed what our “knitting” is. We have different customers inside our client base – procurement, HR, finance, strategy, C-suite, among others. They would seem to have extremely varied requirements, infrastructures and timelines – and they do! We have managed payroll for multinationals, project-managed software architects and developers for government departments, set up an IT operation in Central Eastern Europe, developed a know-your-customer financial services practice in Luxembourg, and much, much more.
We have come to this – our “knitting” is not just the opportunity for clients to buy a single-source integrated solution with programme consultancy, talent, technology and outsourcing initiatives, although that is what we do. While we believe this is a unique offering, and as a 13-year-old company with $100 million in turnover last year, it’s fair to say that it’s working for us, I think it’s more than that.
Companies today listen very carefully to their customers, especially if they are business-to-consumer. They respond to their customers’ aspirations and goals, sometimes leading, sometimes following. Doc Searls wrote the book on this, called the Cluetrain Manifesto.
One of Searl’s sayings was that companies are conversations. They are porous and reflect their environment. So as their customers buy fair-trade coffee, free-range eggs and sustainable wood products, so too these companies are looking for vendors that reflect their values.
Vendors that think beyond the bottom line, that are relationship-driven rather than transactional. Vendors that demonstrate that they truly have a corporate social responsibility – not just write glossy brochures about it. Vendors that extoll diversity, encourage an inclusive workforce and celebrate difference.
Is it more complicated for large corporations to live in the world now? Yes, but engagement always wins over isolation, and the outcome is always better. Their encouragement of a more diverse supplier base gives opportunities to companies like ours, and many others. It empowers us to raise our game, operate at the highest level, and treat every client opportunity as if it were our first. That’s our knitting, and we’re proud of it.