Look around you, everyone is connecting and interacting with others, but not in the traditional way of in-person communication. Instead people are connecting through their smartphones and computers. The social media scene has exploded in recent years, from Facebook to Snapchat, a typical user has over 5 social media accounts.
The average time spent on Social Media is 118 minutes per day per user, which is up from 109 from last year. This increased time spent on social media by consumers is not only to interact with friends and family but has also become a key form of media in which people interact with companies and brands. This is especially true for younger generations. for In fact, a third of Millennials say social media is one of their preferred channels for communicating with businesses. Do you have a strong social media presence to interact and engage with your customers?
Companies around the world use different forms of social media to extend their reach beyond traditional advertising of TV and print. Among top 100 global brands, YouTube is the most widely adopted social network; all 100 companies maintain at least one YouTube channel. Twitter is the second-most adopted at 98% followed by Facebook and Instagram. Having an online presence does not necessarily translate into success, but it is a great start.
A company that has perfected its social media presence over the years is Starbucks. The company not only exists online, but also ensures it is continuously increasing its reach by producing and sharing content on a regular basis that is relevant to its customers. They do this by creating and sharing aesthetically pleasing images and videos of new products and promotions. The content does not only promote products but also calls for engagement from the followers by asking them to share their favorite Frappuccino picture to tweeting about their Pumpkin Spice Latte. This level of engagement by the fan base allows the message of Starbucks to increase reach, and influence not just the fans but also rest of their social circle indirectly, ultimately leading to increased customer base for Starbucks.
As seen from the Starbucks example, social media presence does not mean spending millions of dollars on advertising but instead it’s more about acquiring millions of fans or followers by creating content that is both meaningful and engaging. This allows you to differentiate yourself from the crowd and make your customers want to associate themselves with your company or brand.
Does your company or brand exist on social media, or more importantly, are you engaging with your customers more and more through social media? Let Spartan Consulting help you take a deeper dive into your social media strategy.
Ajay Singh serves as the VP of Sales at Spartan Consulting. He has experience implementing continuous improvement projects as a Supply Chain engineer in the 3PL industry. His past experience has included retail, CPG, and technology clients.
Your company has defined its strategic plan. You understand how you are going to increase profit, innovate new products and deliver value to shareholders/owners. I pose two questions to leadership: do you have the right workforce in place to accomplish your goals? Do you have the right talent pipeline in place to sustain your current competitive advantage?
Leaders know that the talent in their organization is important. However, leaders may not be aware of how competitive the talent landscape has become. Low unemployment, a shrinking labor force, a generational shift in work expectations and emerging industries are all factors that contribute to a competitive labor market for employers.
At the end of October, the national unemployment rate in the United States was 4.9 percent (according to the Bureau of Labor Statistics) and the rate has hovered at or below 5% all year. In economic terms, we are approaching full employment. Due to how unemployment is defined, 100% percent is an unattainable and undesired goal. As an example all graduate students over the age of 25 are considered unemployed, but are considered a leading indicator for a growing economy. A low unemployment rate translates into a diminished labor pool for employers. While your company may be located in a location with a higher rate of unemployment, that may not translate to a larger talent pool for your organization.
In much of the developed world, fertility rates are declining and the share of the population over age 65 is increasing. According to the US census, the rate of the working population will steadily decline from 62 to 57 million over the next few decades. While the number of millennials in the workforce continues to increase, following generations will not replace them in similar numbers. If your industry relies on a large workforce (mass market retail as an example), how does your long term talent strategy account for a workforce that will shrink over time?
The expectation of a 30 year career at the same employer is no longer the norm in the United States. Many individuals entering the workforce assume their career will progress amongst several different companies. This helps and hurts employers. On the positive side, many employer sponsored benefits are not intended to cover a person for life, but rather their time spent at the firm – decreasing costs. Voluntary attrition on the other hand can be extremely expensive. Often time, a company loses highly skilled and high performing individuals to competitors. With the expectation that an individual will only stay at a firm so longs as their career is progressing and they are satisfied, companies have the added hurdle of creating an environment that encourages high performing talent to stay.
Finally, the landscape in the war on talent has shifted. As an example: investment banks used to compete with each other when securing top talent from top universities. Now, those same banks compete with companies like Google and Facebook. Firms that may not have been in existence when the new hires were born. The technology industry has helped to break the mold of what a traditional career path looks like. Younger people are more open to jungle gym like careers that twist and shift as opposed to a career ladder that only moves upwards.
By now, I hope to have convinced you that the war on talent is real. It is not solely comprised of companies fighting for person X, but rather a complex environment where macro level factors influence the business environment. The first step is to admit something needs to be done; it is to acknowledge that taking a look at your talent strategy both long and short term is critically important. The success and failures of a company rests in the hands of the people that run the organization. We at Spartan Consulting encourage you to take the time to reflect on your firm’s strategic goals, and ensure there is a talent agenda aligned with that specific business strategy.
Melody serves as the VP of Marketing and Business Development. Prior to returning to school to pursue an MBA, she worked in a variety of HR roles at an investment bank.
References : Bls.gov , Census.gov
There are abundant cases in business history about successful and unsuccessful M&A deals, and the automotive industry is no exception. The potential synergies of sharing resources, platforms, processes and parts are just too large to ignore. As illustrated in the famous presentation by Sergio Marchionne, the FCA Chief, in his “Confessions of A Capital Junkie”, the automotive industry is earning a ROIC far lower than WACC, the required return by both bondholders and equity holders. In other words, the automotive industry has been destroying stakeholder value for quite a long time. The remedy to this problem, according to Sergio, is large scale of industry consolidation through M&A.
The idea is fairly straightforward:
Take perhaps the most famous case study, Daimler Chrysler, as an example. Before the 1990s, Chrysler had been a huge turnaround story. The margins had been improving year over year, higher than other major OEMs; Chrysler had been cutting its vehicle development cycle so drastically that it only took half the time for Chrysler to develop a new vehicle, which contributed to its efficiency and cost reduction. Daimler came along, and promised great benefits for a combined vision: product lineup complementarity, cost reduction in vehicle development, and combined market share and power. The most valued promise in Chrysler’s eyes, is that Daimler would not make Chrysler a mere part of Daimler. However, it proved otherwise. The Germans were eager to fold Chrysler in and consolidate the resources for the benefit of Daimler. In a manner of fast integration, Daimler basically scrapped the processes and best practices accumulated by Chrysler, and imposed the “Daimler Way” on it. This “Shotgun Marriage” created a genuine disaster: the promised synergies were never realized, which left a broken and battered Chrysler. After 9 years, Daimler sold Chrysler at a price that was far from its acquisition cost.
The major reason for failure in this case was that Daimler sought fast integration in ignorance of what it really wanted from Chrysler. What was good about this marriage was that Chrysler had a lot of best practices, processes and experiences, not merely resources that could be easily duplicated. These were the distinct of ways of doing things that cannot be wiped out. In short, what Daimler really needed to do was to find out the cultures and the processes that should be sustained while slowly folding in the duplicable resources. It was not easy. It needed both parties to sit down and talk through all the major details and work out a long-term strategic plan on how to successfully integrate.
One might ask, have there been any successful mergers in the auto industry?
So far, the only case that might be positive is Renault and Nissan.
There are many distinct features in this deal. The most obvious one is that it is not a straight M&A at all. It is a cross-holding partnership, as boasted by both companies, without full integration. The merit is obvious: while preserving each other’s distinctness, they can share lots of indiscernible resources to lower cost. Indeed, both companies have been slowly integrating with each other:
The result is stunning: both companies emerged from near bankruptcy, and the combined alliance today enjoy a market share and profitability that is enviable to other OEMs.
Going forward, the auto industry is trying to embrace the digital era by partnering or acquiring tech startups, in order to acquire critical capabilities that they don’t have. In light of the cases in industry history, OEMs must be careful of the fashion they conduct post-merger integration. It could be either a glorious victory or a disastrous failure that smothered both companies.
Let Spartan Consulting help you optimize your business partnerships. Click here to contact us.
Qian Yang serves as VP of Finance of Spartan Consulting. He has experience in automobile joint venture management, analytics, negotiation, supplier relationship management and executive communications.
To most people in the business world, the phrase “Lean Principles” brings an image of a manufacturing plant that has waste reduction at its core. Historically, this would be true. Lean principles were derived from the famous Toyota Production System, or TPS, which was developed in the late 1940s by two gentlemen called Taiichi Ohno and Eiji Toyoda at the Toyota manufacturing plants in Japan.
Sakichi Toyoda, the founder of Toyota, came up with the most primitive form of lean manufacturing with what came to be known as ‘just-in-time production.' Central to his philosophy was the urge to direct maximum efforts towards producing what the customers needed by limiting the extent of mass production. He put the first ‘pull-system’ in place. The pull-system meant quite literally what you think- to replenish products that were already “pulled” (or, bought) by the customer. In an industry where manufacturers like Ford, with their Model-T, were pushing their cars onto the customers, the concept of ‘pulling’ was a totally alien one. Sakichi, however, was working under a different environment where space, labor, and other resources were a major constraint. It was critical to him that he made the most economical use of the resources he had.
With time, newer concepts like ‘Jidoka’ (Japanese for autonomation), ‘Kai-zen’ (Japanese for continuous improvement), and ‘Heijunka’ (Japanese for load-levelling) were added and the Toyota Production System or Lean Manufacturing as we know it came into being and took the auto-industry by rage. Toyota, by focusing on waste elimination and implementing lean principles, was able to provide excellent quality vehicles at extremely competitive pricing and the customers loved it. So much so that, other manufacturers visited Toyota plants to learn from them and go ‘lean’ in their operations, colleges started teaching lean philosophies in their curriculum.
If you had asked anyone ten years ago, “What is the future of lean manufacturing?” they would have told you how, after making its way into developing economies, developed nations would also implement them and that it would be the only way the manufacturing industry would operate. Today, however, lean principles have made headway into industries that no one would have thought of. Lean is no longer just a tool for making manufacturing processes more efficient and customer oriented. Lean principles are used in any and every business process more efficient. This was startling to me initially because I could not see how that concept would diffuse into other business processes. However, as I revisited the principles and gathered a greater understanding of what “going Lean” means, I saw its application everywhere.
Going lean, fundamentally, means utilizing one’s resources to the maximum potential. Any process, inherently, has wastes and inefficiencies built into it. Going lean involves looking at those processes and analyzing what steps are value-add and what are not. Going a step further, it means taking a bird’s eye view and thinking outside the box. If a step is a value-add, Lean asks if you can make it more efficient; if it is not, Lean asks how you can redesign the process so that that particular step is eliminated. And you can do this with any process.
I learned this first hand when I attended a Lean seminar organized for conducting animal research. The research industry has been the latest adopter of lean philosophy and is seeing the benefits of it. I know what you are thinking - why does a research industry need to be lean? Its primary focus is to conduct research and invent new drugs based on the results. Sitting at that seminar, I was thinking the same. An hour into it, though, my perception was completely different.
The daily operation of a research facility has so many moving pieces. The cages of animals need to be monitored and maintained to ensure that the conditions are as per the requirement of the researcher. What this means is the attendant has to go through hundreds or even thousands of cages, check parameters like diet and temperature, and make changes where required. A simple Kanban (Japanese for label, a Lean concept) system makes this tedious task easier for the attendant who tracks it. Cages are the end result of all the efforts. Imagine the complexity in supplies if each cage had to have a specific kind of bedding, water, food. Maintaining the warehouse using visual codes and organizing the storage place using 5S techniques saves the employees time to look for the right item. It also enables them to realize that a particular item is running out of stock quickly and that a new order needs to be placed.
In conclusion, Lean Philosophy, to me, simply means making small changes in increment and always. It is a thinking shift that enables an individual to look for opportunities to improve his or her work area. It also means putting a system in place that is logical and reflective of the task to be done; and by system I mean something as simple as labels on the cage. Lean principles make a process more robust and not man-dependent. So, next time, look at your workplace and see where you can go ‘lean’ yourself.
If you are having troubles finding that, reach out to us and see how we can help you go ‘Lean’.
Rachit Shah serves as VP of Operations of Spartan Consulting. He has extensive work experience in the automotive industry where he worked with numerous new product development projects with the biggest auto-manufacturer in India.