Examples Of Organisations That Fell And Then Regained Their Position

include Xerox and IBM:

- Xerox - by 1990 it was no. 21 on the Fortune 500. But then with uncompetitive prices, Xerox fell, ie its stock price plummeted 92 percent in less than two years with declining revenues and falling market position plus a SEC investigation. Things looked grim. But after Anne Mulcahy became CEO in 2001 she reversed Xerox's situation from a loss of more than $US 200 million in 2000 - 01 to a profit of more than $ 1 billion in 2007.

- IBM - in the 1990s, IBM hired an outsider (Lou Gerstner, previously at RJR Nabisco and American Express). He is credited with saving IBM by bringing back together its disparate parts, embracing the Internet and concentrating on services.

Some ways to reinvent an organisation include innovation (see later), bringing in outsiders (like IBM) and/or linking with an organisation that is outside your industry. Some examples of the last include

- Philips (its most profitable products are developed from the food industry and include coffeemakers, blenders and juices plus electronic goods and health-care technology).

- Nestle (has links with Krups to make coffeemakers that use a capsule system)

- DSM (Dutch agricultural company - has been marketing its machines through social media in China)

- Threadless.com uses customer designs to design its own T-shirts and these are manufactured by another company. All this is done via the Internet.

"...these are completely different industries but, by combining them, you can reinvent itself and stay big and alive..."

Fons Trompenaars as quoted by Fiona Smith, 2010m

 

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