Finding and accelerating a more profitable future
Markets are volatile and uncertain, winners rise and loser fall, competition intensifies and customer have a relentless desire for better. Of course biggest is not always best. Market share is rarely a measure of success today. Growth is typically found in profitable niches, where you can grow further, focused and faster.
The best organisations are exponential – they harness technology, but also new business and market models – physical and digital – to accelerate value creation. Think about how WhatsApp created $19bn value in just three years, Uber $60bn in 4 years, Amazon $950bn in 25 years. At the same time, its about ensuring that revenues and profitability follow the valuations.
Shaping your future
What does the future of your market look like. Peter Fisk works across almost every sector, giving him a unique insight into what is happening in each sector, but also how you can take ideas from one sector to another:
- The Future of Automotive: Facing its most profound change in 100 years, with autonomous vehicles, electrification and other fuels, new models of ownership and connected ecosystems. Add to this, AI and smart road infrastructure, connectivity and entertainment. Issues like safety will still matter, Volvo for example, is installing new sensors to detect poor driving, intoxication or excess speed, and take action.
- The Future of Beauty: Personalisation and environmentally friendly products are key to the future of skin and colour products, with new science creating sophisticated functionality. Influencers like Michelle Phan rather than advertising shapes attitudes, whilst the subscription models of Birchbox and direct to consumer models of Beauty Pie have transformed the traditional purchase experience from instore to bathroom.
- The Future of Energy: Decarbonisation, decentralisation and digitalisation are the key challenges for every power generator or distributor. As oil and gas, mining and fracking, give way to solar and wind, there is also a shift to city and home management, from local generation to automated control. Lanzatech turning waste into clean energy, Fluence a huge battery business from Siemens, and Watty are typical disruptors.
- The Future of Fashion: New materials, new business models and new technologies are transforming fashion. From Agua Bendita’s beautiful bikinis made out of scraps to Bolt Thread’s synthetic spider silk, Unspun’s custom-made jeans using a 20 second Fit3D bodyscan to ThredUP’s resale platform, environmental impact has become the biggest issues in an industry which is one of the biggest polluters.
- The Future of Finance: Digital entrants and emerging technologies are transforming banking, from Singapore’s DBS transforming to become “invisible” inside other services, to Atom and Number26 seeking speed and simplicity. Lemonade has embraced AI to transform the business model of insurance, while AXA explores new applications of blockchain, and cryptocurrencies continue to evolve.
- The Future of Food: Wellness and sustainability have topped the agendas of major businesses like Danone, Nestle and Unilever, whilst animal and dairy-based categories have been challenged by plant-based alternatives such as Impossible and Beyond Meat. New channels and business models have been driven by a huge rise in snacking and on-the-go markets, plus home delivery and meal kits.
- The Future of Healthcare: From positive health to personalised pharma, people are seeking to engage with healthcare in new ways. Combine 23andMe genetic profiling with PatientsLikeMe’s peer to peer advice, Babylon’s AI-enabled diagnostics and wearable health trackers, Minute Clinic’s simple consultations and Zipline’s drone deliveries, Organova’s 3D printed organs, gene editing and personalised medicines.
- The Future of Media: Playing games to streaming television, virtual reality and instant messaging, have transformed how we immerse ourselves in content. New business models, in particular subscription, enable access across platforms, as we now shift to content that is even more user-generated and interactive. Platforms like Twitch and Spotify will become more important in curating content and building community.
- The Future of Retail: In a sector dominated by Amazon, innovators like Shopify have helped direct brands to sell and deliver faster. Glossier has shown the power of community and pop-up stores, whilst Etsy has allowed artisans to reach the world, Alibaba embraces gamification to engage consumers more deeply, whilst intelligent delivery businesses like Meituan Dianping know consumers most personally.
- The Future of Technology: AI and cloud will embed tech ever further into our lives, enabling more intelligent and individual choices and behaviours. In telecoms the shift to 5G will enable realtime engagement like never before, video-based content will accelerate with particular application to education and work, whilst our primary user interfaces will continue to shift to voice, eye tracking, and ultimately the brain.
- The Future of Travel: AI will drive transportation to become automated, intelligent and efficient, health and environmental issues will continue to challenge airlines, hospitality and vacations. The shift to cleaner fuels and responsible tourism will be accelerated through innovations like those of Selina’s nomadic places to live, Lilium’s electric flying cars, and Ctrip in the huge Asian travel market.
Harnessing the growth engines
Finding fast growth means opening your eyes to new opportunities – to the fast growth markets of Asia, Africa and South America, or to the new consumers, such as women, millennials and boomers. It means redefining purpose in a way that is relevant, refocusing strategy on markets, and particular the new profit pools, and innovating business models and customer experiences for growth. It also means ensuring that growth is profitable – it is easy to be big, but to create profits, and sustained value, is much harder.
What are the growth engines of business today?
- Markets – finding the best spaces for growth in existing and new markets, for example in new geographies, in niche segments, in adjacent markets, or elsewhere – in the past we assuming that we continue to focus on the same domains, today growth starts with choice of markets.
- Customers – redefining your business around what customers seek to achieve, rather than what you do, gives you huge space to meet their needs better through more joined-up and relevant solutions – enabling them to achieve more, and you to create and capture more value.
- Brands – using your most powerful assets to do more, extending into new markets and categories, through the lens of brands, extensions and innovation. This requires a brand that is about a bigger idea rather than limit to one product and activity.
- Networks – forget the old thinking about core capabilities where you had to produce and distribution everything, find the best opportunities and ideas, then bring together the right partners to exploit it. Networks have an exponential effect, on supply and demand.
- Business models – rethinking the way your business works, in particular the different revenues and cost streams. Consider alternative business models, such as freemium, subscription or time-based – both to generate income, but also to engage customers in more distinctive ways.
Future Accelerator … Developing your growth strategy
Peter Fisk’s “Future Accelerator” process helps you and your top team to find the best opportunities for your business future. Developing the right growth strategy for your business starts with your inspiring purpose, making sense of the future, and a vision for how you can win in it. It is then about insight to find the best existing and emerging profit pools, and understanding customers. And then developing the strategic horizons over which you will shape markets to your advantage, balance today and tomorrow, drive innovation and profitable growth.
Examples of recent future strategy projects include:
- Aster: How can a low-cost textile manufacturing business reinvent itself in a world of declining margins? But becoming a design-centric, producer of incredible brands.
- Coty: Strategic development exploring new business models for the beauty industry to reach new markets of Asia and South America, harnessing new technologies.
- FundGrube: “Moonshot” growth strategy for the Spanish family-owned business, focused on new markets and new formats, to prioritise and accelerate profitable growth.
- Pinar: Growth strategy for multi-national food and drink business, using market and portfolio analytics to find the most valuable options for strategic growth.
- Sabre: Creating the future of travel and hospitality, looking for new business models and innovative experiences to support the future of travel.
- Savola: Brand innovation and extension to enter adjacent markets, from strong brand of commodity foods, to embrace new consumers and trends.
- Turkcell: Growing the SME and retail business, with a strategy that focuses on how a telecoms business enables people to do more, rather than just connect them.
- Vifor Pharma: Strategy development and planning for the world’s leading iron-deficiency business, including segmentation, creative development, future scenarios, horizon planning.
- Virgin: Defining and launching a new financial service business, embracing the brand values to develop banking and investment products that challenge the status quo.
Explore more ideas about growth strategy:
- Article: Moonshot Thinking: We live in an incredible time
- Article: Eureka Moments: Airbnb mattresses to RedBull’s waitress
- Article: Market Makers: Innovate your market, not just your business
- Article: Never Stop Reinventing: Relentless change demands constant innovation
- Book: “Gamechangers: Are you ready to change the world?”
- Book: “Business Genius: A more inspired approach to leadership”
- Keynote: “Megatrends 2025: Find the future of your business”
- Keynote: “Rethink Business”
- Workshop: “Growth Strategy“
- Workshop: “Business Model Innovation”
- Workshop: “Gamechangers Program: Leaders of Smarter Innovation and Business Growth”
- Further reading: “A Playbook for Strategy” by P&G’s AG Lafley
- Further reading: “Growth as a Process” by GE’s Jeff Immelt
- Further reading: “The Five Forces that Shape Strategy” by Michael Porter
- Further reading: “4 Global Forces Breaking all the Trends“
- Further reading: “Rocket. 8 Lessons to secure Infinite Growth“
- Further reading: “Bringing Science to the Art of Strategy” by Lafley and Martin
- Further reading: “Defining Strategy, Implementation and Execution“
- Further reading: “The Executive Guide to Strategy“
- Further reading: “DHL Future Radar“
- Video to watch: “Moonshot Thinking Explained“
- Video to watch: “Past v Future Orientation Explained“
- Video to watch: “The 100 People Project“
- Video to watch: “Exponential Organisations Explained“