The agility for brand transformation
Aarif Morbi and Padmini Mangunta
Diversified businesses have long been considering how and where to invest in technologies that will help them pivot their core businesses in this age of constant change. Those decisions are already in the making for some, while others are just recently working their way through transformation.
Bosch, for example, has been tailoring its traditional businesses for a digital world. It aims to become known as a “leading supplier for the Internet of Things and of pioneering mobility solutions and capturing new opportunities in those markets.”
Indeed, the theme for Bosch’s 2016 annual report was “agility.” And in a world that’s changing at an unprecedented pace, agility isn’t just a buzzword; it’s a critical attribute that heralds how a brand will be perceived in today’s—and tomorrow’s—world. It’s the ability not just to navigate uncertainty but to anticipate shifts and proactively prepare the business for ongoing growth.
But that can’t be limited to strategic investments. For the diversified sector, an agile brand can drive growth in two key areas: the investment and adoption of new technologies and the cultivation of a strong internal culture that acknowledges people and connects them to the growth of the organization.
Truly focused innovation
It might seem obvious that investment in technology should be a necessity in an evolving world. However, often, brands with rich histories and legacies can find themselves resting on past successes and feeling immune to threats from new entrants.
In a changing world, staying agile can often mean streamlining and focusing in on core strengths. GE has spent the last few years shedding noncore assets, like its Capital division, to focus on its core industrial businesses and its ambition to be the world’s first digital industrial company. But in order to demonstrate to the market and to customers that this is more than just words, GE has invested heavily in Predix, its cloud-based software platform that collects data from industrial machines across its businesses. Through collecting data and performing sophisticated analyses, GE creates tremendous value by optimizing its products and entire industrial systems, while also minimizing downtime and maintenance costs—which generates the speed that is necessary for business growth.
GE also purchased oil services operator Baker Hughes (now “Baker Hughes, a GE company”), with the aim to bring its own technology and digital expertise across all sectors of the oil and gas business, while marrying both organizations’ rich history of invention.
Other Best Global Brands are also focusing on innovation by continually investing in research and development. 3M invested nearly 6% of sales revenue in 2016 in R&D, and celebrated the opening of a new USD $150 million laboratory in St. Paul, Minnesota, where its business is headquartered. The 3M Carlton Science Center unites previously disconnected employees, allowing them to collaborate much more efficiently and foster a culture of cross-collaboration and invention. Likewise, Siemens spent upward of USD $5.5 billion on R&D in 2016, resulting in more than 7,513 inventions and 3,500 submitted patent applications—reporting twice the number of new patents per R&D employee compared to 2006.
The Best Global Brands in this sector each run a diverse set of businesses, but their common denominator is the drive and commitment to reinvest in them.
Rapid cultural evolution
While efficiency and structure are vital in order for diversified companies to deliver sustained growth, people don’t react the same way as businesses. People’s behaviors follow different rules, especially as society and culture shifts rapidly. And because people drive growth, businesses have to learn to play by their rules and focus on their internal cultures.
That’s why diversified companies like 3M and GE are approaching their investments in people—both current and future—in an a real-life, responsive manner.
In 2016, 3M made the World’s Best Multinational Workplaces list, an accolade well earned, with employee ratings consistently far above 80%, reflecting the company’s commitment to making significant, relevant changes for its people. Programs like the 3M Women’s Leadership Forum, its FlexAbility program for flexible working arrangements, and its 15% culture, which fosters individual creativity, continue to foster a positive, people-focused, and rewarding culture that fuels growth for the company.
GE likewise made bold moves this year to connect people’s growth to business growth. Recognizing that employees need to be encouraged to take their own risks in order to create sustainable growth opportunities, GE revamped its performance review system—a disruption that’s unleashed significant new thinking and has positioned the company for consistent innovation. Traditional methods for evaluating employee performance—a process that could take up to five months—are being replaced with a more nimble process that helps employees correct course as they progress. The new methods, integrated through mobile technology, are teaching GE employees to become accustomed to the trial, error, and experimentation that the company needs to keep growing.
Brand as the lever of both
Why draw a line between what you communicate to employees and the story you tell the outside world? GE has done away with this divide. The brand now strives to integrate its internal and external communications, telling one story that’s more resonant for all and creating a unified, authentic brand experience on both sides.
By making employees part of the conversation about the future of the company, GE can understand and communicate the impact of inevitable changes, as both the brand and business evolve. This transparent approach makes it easier for GE to clearly communicate its brand vision to those outside the company’s walls. There’s no reason for the people who make up your brand to be in the dark—they are its best advocates, especially when they’re well-equipped and informed.
Technology changes and people change, more rapidly than ever. And a brand can be the thing that shifts along with them. That’s why it’s especially important for diversified companies, with interests spread across different business units and audiences, to cultivate an agile brand, one that connects all the parts, while remaining flexible enough to anticipate, and respond to, continual changes. Taking a focused approach to innovation and keeping employees engaged—and part of that change—will put diversified companies on a singular path toward growth.