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The Evergreen Enterprise：Decoding the success gene of a century-old enterprise

Date：2024.09.13 13:49Views：

(Produced by Celedog® Research Institute, published in Hong Kong in September 2024)

1. Decoding a century-old enterprise

Although different century-old companies may have their own unique ways of success, as Tolstoy said in his novel Anna ·Karenina, "Happy families are all the same, and unhappy families have their own misfortunes." To paraphrase this sentence, the success of century-old enterprises is often inseparable from the following common genes, which help them maintain steady growth and innovation in the context of fierce market competition and changing times:

Fig.1 Huahui nine-square grid (benchmarking practice)

1. A clear and enduring mission and vision

The century-old enterprise has a clear goal and direction, and sticks to it for a long time, and is not swayed by short-term interests. This provides the company with continuous motivation and guidance to work towards a common goal. For example, 3M has been committed to innovation for many years, with a mission to "solve unsolved problems with innovative methods", and has continuously introduced new products, from the original sandpaper to today's extensive and diversified product portfolio.

2. Clear core values and culture

Century-old businesses typically have a solid corporate culture and core values. These values not only provide direction within the business, but also help them build trust and brand loyalty with the outside world. For example, Toyota's "lean manufacturing" and the brand culture of century-old stores such as Coca-Cola are deeply ingrained in the hearts of its employees and customers.

3. Focused Commitment and Sustained Innovation Capability

Centennial enterprises will concentrate on one field or core business, continue to delve into and polish, achieve the ultimate, and establish a competitive advantage that is difficult to be surpassed. Like Coca-Cola, it focuses on the beverage industry and becomes a leader in the global beverage market by continuously optimizing product formulations and brand marketing.

A century-old enterprise will not rest on the success of the past, but continue to innovate and keep up with the changes of the times. General Electric (GE), for example, has been continuously expanding its business areas to include power equipment to aerospace and medical technology.

4. Long-Term Strategic Vision and Adaptability

Centennial enterprises are usually not limited to short-term interests, but focus on long-term development, formulate sustainable development strategies, and unswervingly implement them. For example, in the early stage of development, Alibaba invested a lot of resources in the layout of the e-commerce ecosystem, laying a solid foundation for its subsequent rapid development.

Changes in the market and technology pose constant challenges to businesses. Century-old companies are often highly adaptable and able to make strategic adjustments at different stages to seize new opportunities. For example, IBM's transformation from a hardware manufacturing company to a technology services company focusing on cloud computing and artificial intelligence is to continue its vitality through flexible strategic adjustments.

5. Long-Term Investment and Sustainable Development

Centennial companies tend to focus more on long-term investments than on short-term profits. They will actively invest in R&D, talent development and social responsibility to ensure the sustainable development of the enterprise. Nestlé, for example, has a long-standing commitment to food research and development and a sustainable global supply chain to ensure the long-term stability of its brand in the global market.

6. Robust Governance Structure and Risk Management

Robust corporate governance and a good risk management system are one of the important factors for the success of a century-old enterprise. Centennial enterprises emphasize the "rule of law" and ignore the "rule of man", and have long insisted on controlling organizational capabilities over individual capabilities, and these enterprises usually build a robust and orderly management system with continuous improvement - process, organization, culture, IT, transparent decision-making mechanism and effective risk management and control capabilities, so that century-old enterprises can maintain stable operations in response to various market fluctuations and crises.

7. Effective Talent Management

Centennial understands that talent is its most valuable asset, so it has a clear strategy and long-term investment in talent attraction, training and retention. They have established a sound talent management system to ensure that the company's innovation and operation are always supported by the right talent.

8. Global Perspective and Localized Practices

Centennial enterprises usually have a global vision, but in specific market operations, they can achieve localized business adaptation to meet the cultural and market needs of different regions. For example, PepsiCo adapts its product strategy to the tastes and needs of local consumers in different countries.

9. Customer-centric philosophy

The company focuses on establishing long-term relationships with customers, and always innovates and improves products and services based on customer needs. They understand that a loyal customer base is the cornerstone of a company's survival and growth.

Through these common genes, the century-old enterprise can not only overcome the market storm and continue its vitality, but also continue to grow and expand, becoming the mainstay of the industry.

2. look forward to the everlasting foundation

With the rapid development of digital technology, the complex and changeable business environment and the continuous downturn of the global economy, if enterprises want to achieve long-term success, they need to transform and upgrade on the basis of inheriting the successful genes of century-old enterprises and combining the characteristics of the times. Here are some key coping strategies:

Figure 2 Huahui nine-square grid (century-old company)

1. Accelerate digital transformation

Enterprises need to embrace digitalization as early as possible and digitally manage everything from business processes and supply chains to customer relationships.

- Develop a clear and long-term digital strategy and digital vision: The senior management of the enterprise needs to actively adjust the existing strategic direction from the strategic level, integrate digital and intelligent elements into it, create a high-level strategic plan based on this, closely integrate it with the overall strategy of the enterprise, and clarify the goals, paths and digital vision of the transformation. For example, determine the specific percentage of using digital technology to improve production efficiency in the next few years, or expand how many digital business channels, or become a leader in digital innovation in the industry, or create a benchmark enterprise for intelligent services, so that all employees know and work hard for it, etc., to provide core guidance for the digital transformation of enterprises.

- Continuous optimization of business processes: Comprehensively sort out all activities and processes in the business operation of the enterprise, and integrate digital technology to optimize and improve for the purpose of increasing efficiency and reducing costs. For example, through the introduction of automated processes and intelligent decision-making systems, cumbersome manual operations and approval links are reduced, and the efficiency and accuracy of business processes are improved.

# Biz-Agile®: Penetrates the essence of business (i.e., efficient transactions), integrates agile thinking and business management practices, is guided by customer value, driven by operation scenarios, and flexibly orchestrated with capabilities as service units, so as to provide enterprises with the best business management portfolio and digital solutions.

# Data-driven decision-making: Leverage big data and artificial intelligence for data analysis and prediction, making enterprise decision-making more accurate and agile. For example, with the help of data analytics, retail businesses can better anticipate market trends and optimize inventory management.

# Automation & Intelligence: Introduce automation technology to improve operational efficiency and optimize production and management processes through intelligent technology. For example, manufacturing companies can use the Internet of Things (IoT) and Industry 4.0 technologies to achieve smart production to improve production efficiency and quality control.

- Foster a culture that embraces change: Cultivate a culture that is data-driven and innovative, and encourages employees to actively participate in transformation and spark innovation. Through training, publicity and other means, let employees understand the importance and necessity of digital and intelligent transformation, and eliminate resistance to change. For example, a digital innovation competition is held to reward employees who come up with valuable digital ideas.

2. Innovate business models

Digitalization and intelligence have given rise to new business models, and companies need to be agile and adapt and innovate business models to maintain a competitive edge.

- Platform economy: Transform from a traditional product or service provider to a platform-based enterprise, and create new value by building an ecosystem to integrate resources. For example, Amazon has become a global business ecosystem by integrating supply chains, logistics, cloud computing services, and more through its e-commerce platform.

- Subscription models and service-oriented transformation: More and more companies are transitioning their product sales to service-based subscription models to increase long-term revenue. For example, Microsoft's shift from selling software to providing cloud computing and subscription services has ensured a steady revenue stream.

3. Invest in emerging technologies

To remain competitive in the smart trend, companies need to actively invest in and apply emerging technologies such as artificial intelligence (AI), blockchain, 5G, cloud computing, and augmented reality (AR). These technologies, especially AGI, can help businesses improve efficiency, enhance the customer experience, and provide the foundation for future innovation.

- AI & Machine Learning: Optimizing production processes, personalized marketing, customer support, and more, especially generative AI technology, will lead to new business and operating models for enterprises. For example, AI customer service can improve the response speed and accuracy of customer service.

- Blockchain: Blockchain technology can enhance trust and efficiency in supply chain management, data security, and transparency.

4. Continuous innovation and R&D

The digital age is changing at a rapid pace, and companies must have the ability to continuously innovate and quickly launch products and services that meet market needs. The long-term success of a century-old enterprise often depends on its long-term investment in R&D, and enterprises need to continue to maintain this innovation momentum in the future.

- Open innovation: Innovation through collaboration with external innovation forces (e.g., start-ups, universities, research institutes, etc.) is not limited to internal resources. Innovation is not limited to products, but should also be reflected in services, processes, customer experience, etc.

- Agile development: Through the agile development process (you can refer to the Biz-Agile® related articles), we continuously iterate products and services to quickly respond to market changes and customer feedback.

5. People-oriented talent strategy

The development of digitalization and intelligence requires more interdisciplinary and digital talents. Businesses need to make strategic investments in developing, attracting, and retaining these talents.

- Cultivation of digital talents: Improve the digital skills of existing employees through training and re-education, especially for enterprises in traditional industries, and help employees transform from manual operation to digital and intelligent management.

- Establish a flexible organizational structure: In the era of intelligence, enterprises need a more adaptable organizational structure, reduce hierarchies, enhance cross-departmental collaboration and information flow, and form an "agile organization" (you can refer to the special article on the integration of industry and technology integration team).

6. Intelligent upgrade of customer experience

Customer expectations and demands in the digital age have changed dramatically, and businesses need to deliver a more personalized and seamless customer experience through smart technology.

- Customer data analysis and precision marketing: Analyze customer behavior through big data and AI, provide personalized recommendations and services, and enhance customer stickiness and satisfaction.

- Omnichannel integration and customer engagement: Create a seamless customer experience with multi-channel integration (online, offline, social media, mobile) for intelligent customer management.

7. Strengthen data security and privacy protection

With the development of digitalization and intelligence, data security and privacy protection have become the key to the future development of enterprises. If a century-old enterprise wants to build a long-lasting business, it must ensure data security and compliance and win the trust of customers.

- Data governance and compliance management: Establish a sound data governance system to ensure that data is used in compliance with privacy regulations (such as GDPR) and prevent the risk of data breaches.

- Cyber security: Improve cyber security protection capabilities through artificial intelligence, blockchain, and other technologies to protect the data of enterprises and customers from hacker attacks.

8. Social Responsibility and Sustainable Development

With the development of digitalization, enterprises are facing more attention and pressure in terms of social responsibility and sustainable development. Enterprises need to use technology to promote green development, circular economy and social responsibility.

- Green technology: Adopt intelligent technology in the manufacturing process to reduce energy consumption and carbon emissions, and promote environmental protection.

- Sustainable supply chain: Optimize supply chain management through digital means to ensure the rational use of resources and sustainable development.

9. Synergy between globalization and localization

In the global competitive environment of digital intelligence, enterprises need to have a global vision and adapt to the localization needs of different markets.

- Global resource integration: Leverage global digital resources to achieve innovation and efficiency improvement, and share knowledge and technology through global markets.

- Localized customer satisfaction: While digitalization breaks down geographical boundaries, businesses still need to adapt locally to the culture and needs of each market to ensure local adaptation of the brand.

In order to achieve long-term success, enterprises not only need to inherit the successful genes of traditional century-old enterprises, but also follow the trend of the development of the times, actively embrace digital intelligence, improve innovation capabilities and operational efficiency, and make profound changes in talents, organizations, technology, customer experience and other aspects. Through these measures, companies can continue to maintain their competitive advantage in the fast-changing market environment of the future and move towards a more brilliant future.

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