By Joe W.
Forehand
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PDF Help This Outlook Point of View is
based on a speech presented by Joe W. Forehand, Accenture's chairman & CEO,
at Accenture's 2002 International Utilities and Energy Conference. I spend a great deal of my time meeting with leaders around
the globe. In these conversations I really focus on being an active listener,
so I can truly understand what is on their minds. As you might expect, we talk
quite a bit about what it takes to compete in the 21st century.
Leading companies today need to operate in a much different
way than we ever have because the fundamental nature of the corporation itself
is changing. In the past companies were much more vertical and hierarchical.
But today leading companies need to strive to become connected corporations.
A Learning Network The connected corporation is essentially a learning network
that knows how to maximize the value of its many relationships with customers,
suppliers, employees, shareholders, government regulators, the media and
others.
I believe that successful corporations will be those that
understand how to manage and make the most of those relationships in a
collaborative and non-hierarchical way. In fact, by emphasizing this kind of
flat learning network, connected corporations will create sustainable value to
carry them through turbulent times. They will operate with more agility and
will have the ability to be more proactive in serving customers and in building
a highly productive and motivated workforce.
The New Customer Relationship Clearly, we have moved beyond a world of merely managing
customer relationships—companies increasingly are fighting for a larger share
of the customer's wallet.
For many companies, this means improving or expanding
dialogues with customers, be they conversations or data-driven insights across
a broad range of functions, including product development, brand strategy,
customer retention and service delivery.
This increased emphasis on the customer runs across
industries. For example, automobile manufacturers in the product development
cycle are bringing customers into the early stages of the design process—which
used to be a closely guarded secret.
In the telecommunications industry, mobile phone operators
increasingly use sophisticated customer insight data to manage churn. Why?
Because the ability to extend a service contract from one year to three years
will drive the profitability of their businesses.
In retail, Accenture has worked with companies that are
using sophisticated software that helps them get more yield from advertising by
managing its effectiveness—looking at their customers' buying decisions and
how advertising affects those decisions.
So this era of moving from customer relationship management
to managing customer insight will really be the new art form of dealing with a
customer.
Focusing on the Strengths of Your Core Business
Certainly another key element of the connected corporation
is the notion of developing strong business partnerships to support non-core
functions. Jack Welch has often said that your back office is someone else's
front office. A truly connected corporation focuses closely on where the
company can achieve the most value and ensures that its leadership's time and
attention are directed to those areas.
Last year, Michael Dell and I co-hosted a session with
several chief executives, and we looked at how companies can get the most value
from alliances and business partnerships. We concluded that you first need to
understand your own company's strengths and competitive differentiators, and
focus your resources on what you do best. Then you can look for business
partnerships that can drive those non-core functions.
The CEO of a small jet manufacturer who attended our
discussion summarized this point nicely. He said, "We decided we have to be
great at wing design, sales and marketing. And for everything that doesn't fit
with that, I look to a business partner to help drive more effective costs. And
I leverage my time and attention on how I have to compete in an increasingly
competitive world."
Connecting to Your Workforce I believe that the most important connection for a company
is the relationship with its people. After all, it is our people who get up
each day to help make our organizations successful.
As I discuss this topic with senior executives, I hear a
number of common themes. Many leaders are focused on establishing trust and
credibility across the organization. Trust is paramount for success—you need to
be open and honest with your employees.
I also hear a lot about the importance of the company's
image and branding efforts. People will be more loyal—and they will also have
more intense interest in building a company—if their company's brand in both
the global and local marketplace is considered a leading brand.
It has also been my experience that leaders need to be
approachable and willing to engage with anyone in the organization and deal
with their issues on their terms. An open communications style becomes more and
more important as the ability to inspire a workforce becomes more critical.
The majority of executives I meet with today believe that
leadership development is a top priority, yet they also believe it is one of
their company's most significant weaknesses. So there is a disconnect here, and
it is one that cannot be overlooked.
Because if you look from a shareholder's perspective,
building a great workforce is aligned entirely with value creation. Every
public company is working to widen the gap between its market value and its
book value. That can be achieved by building a brand, or through intellectual
property and other assets. Or it can be achieved through the belief that future
leaders will grow a future cash-earnings stream.
The 21st-Century Corporation In addition to its customer, business and workforce
relationships, the connected corporation also needs to manage its relationships
with external stakeholders, such as government regulators and the media. We are
already seeing a world where investors are discounting fuzzy accounting,
obscure disclosure and weak governance. The premium on transparency as we look
at this next decade will be even higher.
Overall, we are seeing the development of the 21st -century
corporation as an entity that is fluid and decentralized–one that can
continually reinvent itself and can operate both globally and locally.
But my personal view is that for any company, the most
important goal for winning in the future should be directly related to
developing people. This is all about getting the right people in the right
roles and working toward a customer-focused strategy. This is how an enterprise
creates value.
Joe W.
Forehand is chairman & CEO of Accenture. This
Outlook Point of View is based on his speech "Leading Your
Company to Success in Today's Challenging Economy," presented at Accenture's
International Utilities and Energy Conference 2002, held in April in Rome,
Italy.
The views and opinions expressed in
this article are meant to stimulate thought and discussion. As each business
has unique requirements and objectives, these ideas should not be viewed as
professional advice with respect to your business.  To Top
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