JEDDAH – New Booz & Company research strikes down the notion that misreading, ignoring or de-emphasizing the market, customers and other external forces is what gets most big companies into trouble. Companies have actually become quite good at avoiding these problems. Instead, they get into trouble because they aren't inward-looking enough and don't assess themselves in the same unbiased, focused way they do their competitors and the market. As a result, the strategies they develop often fail to center on the company's most powerful capabilities and its distinctive way of providing value. These are insights from management consulting firm Booz & Company's recently completed report, “What Drives a Company's Success,” based on a new global survey of more than 700 senior-level executives throughout several industries, including financial services, technology, manufacturing, energy, electronics, consumer, pharma and automotive and across several countries, including the Middle East. The survey asked respondents to select up to three companies in their industry and answer questions about what drives these companies' successes. It also asked respondents to comment more generally on the reasons for success and failure of strategy. “What companies seem to be struggling with is that they don't know themselves well enough,” said Paul Leinwand, Partner at Booz & Company. “They don't analyze themselves with the same rigor they use to analyze the market, and don't have an objective view of what they are truly great at doing to guide their strategic decisions.” When asked which of six strategic issues are most problematic for companies, only 7 percent chose “ignoring external market forces.” However, 29 percent said “having too many strategic initiatives that are disconnected”; 27 percent said “focusing too much on short-term performance improvement and too little on what will create long-term success”; 20 percent said “not considering whether the company can execute its strategy”; and 11 percent said “trying to be like others rather than creating a differentiated identity for the company.” In fact, according to a separate Booz & Company survey, 55 percent of executives admitted to feeling that their company's strategy will not lead to success. – SG
