After weeks of reducing SHV and survival strategies our efforts had been rewarded. Our SHV was heading in a positive direction however just as we were starting to pull our heads above water we found our company had been taken over. This week as CEO the problem I faced was how to manage a relationship with our new owners and ensuring the continued improvement in our firm in this new environment.
Firstly the main problem with the takeover was determining how much strategy we should share with our parent company. Our companies were very similar, perhaps too similar and my team had some serious trust issues. It was understandable, the week before with only 9 cents to our name we had spent a lot of extra time working together and we did not want to see this go to waste. Basically as my title suggests we did not want to upset the delicate balance we had found by including another company. To resolve this I went searching for an objective party to give me some advice around takeovers. I spoke to both Smart Sims and Peter. Peter let us know that it would be counterintuitive for our parent company to ruin us and that we now held a lot more power in the situation. However in contrast Smart sims responded that they had seen parent companies ruin their subsidiaries and have seen subsidiaries rebel against the parent company. Managing the relationship I felt was really important and although I tried hard this week to ensure communication with the other team I feel that we could have met more often. This is because a few hours before the roll-over we were hurriedly trying to work out strategies rather than organising it previously. This is something I hope to improve on for next week particularly as we are now part of a mega-firm; a lot more coordination is required.
Having been in survival mode we found at the start of this week that we were a bit lost as to the content of our strategy. So figuring out how to ensure the continued improvement of our firm was difficult. This is because our original strategy had been scrapped in trying to improve our SHV and now that we were profitable we were unsure where we wanted to take our company. This I found was useful for communication with our parent company as we could adjust our strategy in accordance with their own to try and maximise sales in the market. So it was quite useful this week that the readings were around growth strategies. One part that particularly stood out was the idea around reallocation of resources. The goal of this is to target pockets of the market that are at a higher momentum than other areas (Baghai, Smit, & Viguerie, 2009). I feel that I need to work with my group and our parent group to ensure that we are not directly competing against each other and that we are focussing on target markets for the next few roll-overs. I am not sure how well this will work however as our parent company have a number of different bikes in a number of different markets. So our growth strategy needs to focus on quality or quantity depending on the bike and how well we are selling. I found the second reading also rather interesting and thinking about it I feel that my firm has gradually developed a more analytical approach to the program as the weeks moved on and we were trying to reverse the direction of our shareholder value. Looking back at those first few weeks I think we keenly felt the loss of the roll-back feature as it prevented us from continuing our trial and error approach. Only once we began to do really badly did we stop and think more analytically about our results (Davenport, 2006). I really feel like at the beginning our firm did not have the right focus and was not really looking at a lot of the information provided to us by the simulation to allow for improvement.
Hopefully now that we have learnt our lesson we will continue to see growth for the last few roll-overs. Our new goal is trying to get back to the starting SHV of $12 if we can manage this, coming back from 0.09 I think it will be an amazing achievement. Just as a final point I found it a bit difficult to see the relevance of the readings for this week and I apologise for their lack of inclusion in this week’s journal, I felt that I had learnt a lot more from the circumstances this week than the theory. However I have tried to include them in as clear a manner as possible.
Baghai, M., Smit, S., & Viguerie, P. (2009). Is Your Growth Strategy Flying Blind? [Article]. Harvard Business Review, 87(5), 86-96.
Davenport, T. H. (2006). Competing on Analytics. [Article]. Harvard Business Review, 84(1), 98-107.