It's tough staying at the top
Adaptability is a key driver in sustaining performance, which has become harder to achieve in today's highly dynamic market environment, says Mana Lohatepanont, managing director for Thailand and regional director for Southeast Asia at Hay Group, a global
Among more than 1,000 companies that Fortune magazine included in its global rankings of the World’s Most Admired Companies (WMACs), there are only 56 companies that have retained their status in the top 100 over the past decade. Similarly, in the Hay Group’s research of the WMACs 2011 report, of the total 56 industries surveyed, there are 22 industries which have new leaders in their industries. For instance, in the petroleum industry, a long-time champion, Exxon Mobil, has been replaced by Stat Oil of Norway, Alcoa has been succeeded by Posco of South Korea in the steel industry, and in the telecom industry, AT&T has lost its crown to Telefonica of Spain.
“An economic crisis is like an earthquake that shakes up the business landscape entirely as some companies take the crisis as an opportunity to conquer their competitors,” he said.
“It becomes a necessity for firms to be adaptable and agile in responding to changing markets and equipping employees with the opportunity and necessary skills to execute corporate strategies.”
Only Procter and Gamble and General Electric have consistently maintained their leadership position in their respective industries since the WMACs report was first conducted in 1997, while Berkshire Hathaway and IBM have retained their top industry rankings since 1999 and 2003, respectively. Nonetheless, there are some industries in which the key players have not changed over the years such as the consumer food products industry where Nestle and Pepsico have always been top and runners-up.
In this year’s all-stars ranking, Apple, Google, and Berkshire Hathaway retain their previous year’s status as the top-three most admired companies, although Starbucks, Singapore Airlines, BMW, and American Express emerge as newcomers in the top-20 list. In the Asia-Pacific region, Toyota, Samsung Electronics and Singapore Airlines continue in the top three ranks, although LG, Hyundai Motor, and China Mobile emerge as newcomers in 8th to 10th positions.
The peer ranking survey is based on nine attributes: innovation, people management, use of corporate assets, social responsibility, quality of management, financial soundness, long-term investment, quality of products/services, and global competitiveness.
The Hay Group research identifies four key areas that adaptable firms use for achieving sustainable performance: focus on priorities for growth [focus on high-growth markets and fast-growing organisational units/subsidiaries], culture of innovation, employee involvement, and enabling employees to succeed, onboarding and integrating new staff into the organisation; skills development; managers provide coaching, feedback and identify performance barriers.
