At $4.3 B in annual revenue, Belgium-based UCB S.A. would place about 14th among Fortune 500 US pharmaceutical companies. But unlike its larger peers, whose industry-consolidating mergers have massive layoffs, all for the sake of cost-cutting earnings growth, UCB focused its business model innovations on unique advantage. As a result, UCB is delighting patients and employees alike. I learned about UCB’s business model innovation from UCB’s Loïc Elleboudt. He spoke at the recent Swedish Marketing Federation’s Annual Tendency Day in Stockholm where I was the keynote speaker. The terrific event focused on innovation – from business models all the way through to digital media. Founded in the 1920s as an industrial chemistry company, UCB shed its non-pharmaceutical businesses and acquired two biotech drug companies to focus solely on “biopharmaceuticals,” a combination of large, antibody-based molecules and small, chemically derived molecules. Its business model…
Is “Great to Good” the new business model strategy?
In using “Great to Good” in my title, I am quoting from new product development consultant Monica Wingate, of Fountainhead Brand Consulting, whose recent Evolve NPD Blog post summarizes key insights that she gained from the 2010 Market Research Summit held at University of Wisconsin, Madison’s A.C. Neilson Center for Marketing Research. I advise reading her post to learn how research methods will change in today’s challenging economy. The conference insight giving rise to Wingate’s Great to Good reference is that “Companies will embrace the ‘new normal’ by focusing on taking out less important features and lowering the price rather than adding value and cost into products.” If this is branded consumer goods companies’ core strategy for the “new normal,” they are stepping into commoditization’s quicksand. Why do I use the word quicksand in talking about commoditization? Because that is how commoditization happens…
Does Carly Fiorina’s HP legacy foreshadow her Senate leadership?
It seems natural to judge a political candidate by her previous work performance, which is precisely why my eyes are on the California Senate race. Former HP CEO Carley Fiorina is challenging the incumbent democrat, US Senator Barbara Boxer, to represent the financially strapped state. While the two women trade public policy barbs, HP shareholders are debating whether to dump HP stock. From my perspective, the seeds for HP’s current problems were planted from 1999-2005 during Fiorina’s tenure as CEO of HP. (Disclosure: I vote in Wisconsin. I am an independent and have voted for both parties.) Before her forced exit, Fiorina changed HP in two ways that each demanded significant internal focus. First, she reorganized the company, a reorganization that Mark Hurd who followed Fiorina spent time dismantling, as it diffused responsibility for organic growth and delayed decisions. (Hurd’s reorganization cut out…
IBM’s Smart Business Model Strategy
IBM’s Smarter Planet initiative is more than smart branding. The initiative reflects smart evolution in IBM’s business model. Over the past decade, the Fortune 500 company exited commodity IT hardware (e.g., personal computers) to make investments in high-end IT, such as data analytics. As IBM’s income from hardware fell from $2.7b to $1.4b, income from software rose from $2.8b to $8.1b between 2000 and 2009. The broader scope and higher-end capabilities positions IBM as a catalyst to advance individual enterprise performance and significantly advance system-wide improvements in health care, transportation, energy, public safety, water and educational systems, or what IBM calls a creating a Smarter Planet. IBM is now positioned to improve how cities – where all these systems come together in a “system of systems” – operate. Thus the Smarter Cities initiative. The aim of the Smarter Cities initiative is to make…