Category Archives: strategy

Smoke screens?

We intend to achieve world-class process efficiency by implementing a systematic and quality-related improvement of processes and cost-efficiency in our production, sales and administration. We thereby hope to secure long-term competitiveness and generate strong cash flows that can be used for profitable growth.

This is a real-life statement from a high executive. Is there a hidden agenda?
Or is it merely a creative formulation of no other plan than sacking people?

Lego businessman on bench

Maximizing Shareholder Value

“On the face of it, shareholder value is the dumbest idea in the world. Shareholder value is a result, not a strategy… your main constituencies are your employees, your customers and your products. Managers and investors should not set share price increases as their overarching goal. … Short-term profits should be allied with an increase in the long-term value of a company.”
This statement came from the one person who might have been the best CEO ever to run the trick of maximizing shareholder value. It was Jack Welch who said this to Financial Times in 2009.
When I came to STORA (now Stora Enso) in 1996, the first words I heard from the CEO Lars-Åke Helgesson were that his job was to increase shareholder value. To me this was back then a major surprise; I thought that the products were the core. Well, that’s what it all comes back to in the paper industry – tonnes! There was soon a chicken race between the newly formed Stora Enso and International Paper. IP had always been the biggest of them all – in tonnes. This race continued several years, seemingly resulting in big bonuses for the kamikaze pilots Jukka Härmälä and John Dillon.
Early on, I started to believe that it was the customer that should be in focus. This was however not often a standpoint we saw in leaders of the paper industry. They often referred to their business as “the industry”, and were regarded as highly arrogant by most of their customers. This attitude was present on almost all levels, the standard answer to a complaint on poor performance in a printing press being it is not paper related. An answer that actually never resulted in happy customers.
Recently, there has been some improvement in the attitude from paper companies. I have even heard the concept of “customer success” being mentioned by at least one CEO. It may never be to late to change…

For more comments on shareholder value not being a wise strategy, please read Steve Denning’s column in Forbes: The Dumbest Idea In The World: Maximizing Shareholder Value.

Experience…

Experience is what you get when you didn’t get what you wanted.
Randy Pausch told us so in his now super-famous Last Lecture: Achieving Your Childhood Dreams that has now had more than 14 million views on YouTube. This even exceeds the 12,5 million views of Steve Jobs’ 2005 Stanford Commencement Address.

Please view Randy’s lecture – be prepared for a one hour plus amazing session.

Curiosity killed the cat …Not!

No, curiosity is something good. Today there’s even talk about not killing young children’s curiosity during their first school years. Amazing if that will happen within reasonable time…

Personally, I am devoted to make a living from my curiosity. People used to say that “I don’t want to die curious”, meaning that they were devoted to satisfy their curiosity. I would rather state that I’m going to die still being curious. My almost unlimited interest lies in many things, especially the extremely fast technology development. Digital communication and social media are some of my favourite areas. All this is very useful in my new role as a free agent doing situational and scenario analysis. I even found a new title – Future Strategist – after taking an extended course at Kairos Future.
So now I’m looking for challenging opportunities to do some work in my new role. Anyone up for a new strategy? I am here to assist you!