The China Impact

The rapid rise of China is beginning to impact most areas of UK trade and industry in one way or another. A Warwick Business School research project recently completed the largest survey of its kind ever on foreign investment and innovation alliances between multinational firms and their counterparts in China. The report highlights how Western firms are benefiting from synergies with Chinese firms, but also appear to be breeding their future competitors. The report contains strategic lessons for UK firms and for UK policymakers about how to adapt to the China impact.

Full copies of this report can be obtained from our website Articles page : www.cultivar.co.uk/articles.php

How investment in Creativity, Innovation and Design can make a difference.

In the context of rapidly changing consumer tastes and aggressive competition from foreign firms, UK companies are recognising that they can no longer derive any kind of competitive advantage simply by reducing costs. In order to compete on a global scale it is now necessary for them to gain an advantage by creating and exploiting intangible intellectual assets.

Investment in design can help companies compete more on quality and less on price, making them less vulnerable to competition from low cost producers. However, to be successful good design must be incorporated across all aspects of the business; its products and services, company processes and systems, its working and retail environments and its brand management and marketing. Design should act as an interface between a company and the international customer, ensuring that a company delivers a product or service that the customer wants and in a way that adds value to both.

Out of all these intellectual assets, creativity, innovation and design are the most vital sources of competitive advantage. According to the Cox Review of Creativity in Business,

Creativity is the generation of new ideas – either new ways of looking at existing problems, or of seeing new opportunities, perhaps by exploiting emerging technologies or changes in markets.

Innovation is the successful exploitation of new ideas. It is the process that carries them through to new products, new services, new ways of running the business or even new ways of doing business.

Design is what links creativity and innovation. It shapes ideas to become practical and attractive propositions for users or customers.

Design may be described as creativity deployed to a specific end.

You can download the Cox Review in full here: http://www.hm-treasury.gov.uk./independent_reviews/cox_review/coxreview_index.cfm

Can do? or Can’t do? – which are you?

I am in London this week and attending some of the events at London Design Week. My interest in this event stems from helping UK based manufacturers to build competitive barriers to manufacturers from low-cost economies by improving their innovation and creativity. its well known that the UK produce some of the best designers in the world, but why do they have to go overseas to ply their talents?

I met the CEO from one of Britains top furniture designers and manufacturers and asked him about his supplier sourcing policies. He responded by saying that most of his companies products were now sourced from manufacturers in China. I was suprised at this since his company work at the high quality, high price, low volume end of the market where design is often said to meet art. However, his reasoning was simple:-

“in China I meet manufacturers who are always responsive to our needs… they always say they can do what we want, even if it means investing in new processes, plant and machinery. They take a longer term view that they can build their business by meeting market needs. In the UK we so often get a can’t do that response, and an unwillingness to change how they make something, or invest as a partner”.

Is this true? are our manufacturers averse to new opportunities? Is their return on investment horizon too short? What do you think?

Strategic Accounts – The 80/20 rule

You are likely familiar with the 80/20 rule, but did you know that according to strategic sales experts Miller Heimann, in most organizations the ratio has actually grown to an even more alarming proportion? Twenty percent of customers generate 90 percent of the revenue while 30 percent of organizations don’t have key account managers.

Is this true for you? have your tracked this trend? what are you doing about it? what are the consequences of doing nothing? let us know…

Full copies of the Miller Heimann report can be downladed from our website articels page : www.cultivar.co.uk/articles.php