The German drugstore Schlecker will be leaving the Dutch market. The price fighter faces decreasing revenue and decided to close all stores. Recently we have seen quite some companies aiming at price competition close their doors. Although it always has been argued that this strategy is not sustainable, it is interesting that it becomes clear in these economic times. On the one hand you might expect that buyers are more price sensitive and turn to these discounters. One the other hand the business models depending on low margins and high turnover are high risk in these times.

From studying succesful companies it becomes clear that applying a hybrid strategy is the way forward. Generic strategies like the ones described by Porter are to limited to stay competitive in the current competitive landscape and economic climate. Succesful organizations adopt a combination of competitive aspects to build a Hybrid Strategy. Examples are: IKEA (differentiate in design + low cost), Toyota (quality - although under pressure + price) and Ahold (quality + price). Just competing on price isn’t good enough anymore. Therefore we enter an interesting new era of strategic management in organizations.

An interesting HBR Blog post ‘Learning from Toyota’s Stumble’ by Stephen Spear. It reflects on what we can learn from the recent issues Toyota is facing with pedal malfunctions. Toyota for a long time has been leader in quality and books were published on the Toyota Way in almost all management area’s. From this case we can learn that this competitive success is fluid.

According to Spear the way to sustain success is to continue learning and improving: “The capabilities to do this are poweful but fragile and need constant reinforcement … This includes developing people by investing time in mentoring and developing their capabilities for pushing the boundaries of quality, efficiency, safety, and responsiveness, and taught them how to build those capabilities in others. But as we are now sadly seeing, the capacity for developing people can be overstretched. It was not recognizing this and succumbing to the temptation to make growth its first priority that led to Toyota’s current problems”. This stroll of events caused great damage to the carefully developed image of Toyota being the most reliable car manufacturer in the World with quality and innovation as it’s guiding principles.

Conclusion: It is already hard to become a true learning organization, but it is even harder to stay one …

One of the interesting fields of innovation today is business model innovation. Although technological innovations raise most interest and have the highest impact, business model innovation is the lever to business success in most cases. Examples like Google, Easyjet and IKEA prove that innovative business models can generate sustainable business success. In the module on Innovation & Entrepreneurship that I conduct for TSM Business School I used the very practical Business Model Canvas approach propagated by Alexander Osterwalder. For a brief summary of the idea watch the following video of his 7 minute presentation at the Emerce Day in the Netherlands.

Clive Shepherd twittered a nice presentation ‘e-Learning Sucks’. It covers the fact that most e-learning design just follows traditional instructional design models (’lectures’). I come across this phenomenon often when subject matter experts use authoring tools to braindump their knowledge into powerpoint like e-learning modules. They call this rapid e-learning, but a good friend of mine tends to call this e-sleeping (in the presentation you see why!).

From the nice design of the slides you can grasp where the critique comes from: media & game design. Although I agree that principles of media & game design can be excellently applied to e-learning this is not the only route. Not all powerfull stuff on Internet looks great. You just have to be creative in using the strengths of internet to support learning. Conclusion: nice work and good points, but there is more to good e-learning design when you ask me.

Business Week published a nice article on how the Indian Tata Group builds a culture of innovation. The word ‘culture’ may suggest that innovation is hard to grasp. Not true in the Tata case. They have implemented very practical formal instruments to foster innovation in the organization. These instruments range from the Tata Group Innovation Forum, an Innovation Competition and Innovation Labs to 5 hours per week for personal projects. The good thing of this example is that it showns that your can build innovation into the DNA of an organization, even with the size of Tata. In my opinion it is about a combination of formal instruments and consistent internal communication. Tata shows that this can be the winning formula!