L E S S O N S F R O M S U P E R S T A R C O M P A N I E S

Playing to Win

Ajay AroraSeptember 2016

Why study the Superstars

� Everybody admires the Superstars but the ingredients to success are still not widely know� This research paper is aimed to capture and present

a comprehensive view on making of a Superstar company� Common characteristics of companies that have

sustained success over a considerable period time are presented in next few pages

1. Obsession with Talent

� Hire the Right People and turn them into Loyal Corporate Warriors¡ GE spends a billion dollars p.a. on training; 40 VPs of GE

became CEOs of major companies� Elitist to the Core¡ HUL, GE, Google – all fast track their promising employees

� Watchful eye on High fliers¡ Jeff Immelt (the GE CEO) has detailed knowledge of 600

people at the top of his company including their family circumstances and personal ambitions

� “Stretch Assignments”, “Accelerator Experiences” and so on

2. Investing in Core Skills

� Amazon ¡ Sacrificed dividends for years to establish mastery of online

shopping

� BMW¡ Investing in new materials like Carbon fibre and things like

Parking assistance

� Corning¡ Evolved from making glass for Edison’s first light bulb to

‘Gorilla’ glass of iPhone

4. (Right) Balance between Long and Short term

� Many family companies score in this aspect due to dominant owners ¡ Free to think long term and not bowed by ‘quarterly’ pressures

� Other mechanisms such as Dual voting structures ¡ Extra voting rights to founders justified by Facebook, Google

and others

5. Extravagant Goals

� Also known as BHAGs (Big Hairy Audacious Goals)

¡ Coke wants to put a can of within ‘easy reach of everyone on planet’

� Having achieved those goals, they move the Goalposts¡ Amazon – from world’s biggest bookstore to be the world’s

biggest everything store

6. Endless attention to Detail

� Enable the link between “Strategic Vision

& Everyday Operations”

¡ Steve Jobs@Apple – went down even to the ‘exact shade of grey’ for signs in its stores’ lavatories

¡ Ingvar Kamprad@Ikea - continually toured stores well into his 80s

7. Reassessment of Investment decisions

� Regular Reassessment - in light of changing environment� Agility – fighting a constant

war against bureaucratic bloat, unnecessary complexity and overlong meetings¡ R&D labs of Apple and Intel in Carnegie Mellon’s collaboration

Center¡ Every Car company has opened an office in Silicon valley¡ Close relationships with startups÷ GE Garages – lab incubator to provide startups with access to its

experts and equipment

8. Rooted Cosmopolitans

� Balance between Global scale and Local roots¡ Microwave ovens destined for

East India (by Samsung and LG) have autocook option for Bengali fish curry

¡ Oreo biscuits for China have less sugar and more familiar flavours such as Green tea

9. Radical changes in order to Survive

� Disrupting their own core businesses before someone else does¡ Netflix disrupted its video-delivery

business by embracing steaming¡ GE÷ In 1980s and 1990s worked on the decree of being in top 3 in the

world in all its businesses (or getting out)÷ Jeff Immelt is now restructuring GE for the digital age, selling off

GE appliances, buying Alstom, investing in IoT and moving the HQ to Boston to be closer to the heart of High-tech.

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Thanks