Three fundamental changes, demassification, shrinking distance and collapsing time - are reshaping the world marketplace.
These changes are creating an entirely new competitive environment, which offers opportunities of previously unimagined magnitude, but at the same time, imposes unprecedented demands. The enormous promise of this new global environment, and it's equally enormous pressures, demand nothing less than functional excellence: superior performance across the board, in every major functional sector.
Functional excellence means marketing creativity, a continual stream of innovative ideas for brands, products, packaging, inventive new advertising and promotional programs.
Second, the winners in this era will achieve excellence in the management of their supply chains, all the way from raw materials to the retail shelf. Companies whose supply chains are not only efficient and cost-effective, but also innovative and responsive from top to bottom, will enjoy a competitive advantage. Where in the past we've known marketing wars, in the very near future we'll be seeing supply chain wars! For example, consider what its global anchor bottler system does for Coca-Cola!
Third, success will demand excellence in field sales execution, delivering product package, price point, merchandising and consumer support that focus on the needs of every individual retail customer.
New, winning concepts and solutions won't arise in the classic, top-down big company command mode. They come from real, first-hand immersion in current, day-to-day practice in the field - the new product lab, the manufacturing floor, the marketing duel, the face-to-face sales dialogue. Strategy can't be handed down like the tablets from Mount Sinai - it has to grow organically from the body of the organisation itself.
The corporate environment must become an open and a learning environment, top to bottom, stimulating and welcoming new insights, new concepts, new solutions. All its people must feel not only the freedom to say, openly and honestly, what they see and think, but must be encouraged to do that, and rewarded for it. Today, the most important job of senior management is to find, facilitate and reward creativity, on all levels in the organisation, so the company can keep adapting to the rapid-fire change that will characterise the marketplace.
When my colleagues and I at Beverage marketing do our industry studies, we keep hearing words like: The things they're doing at that company are really cutting edge! …… They're way ahead of the rest of the pack! …… These guys are the best! We find that the people in those companies know they're leading-edge; feel good about it, and fight as hard as they can to keep that edge. Among them we find a small number of companies that have moved even further; they are clearly superior to competition in key areas of excellence, and everybody recognises that they are. For example, the way Heineken manages its containerisation and shipping programmes - way ahead of the field.
There is a term that people are starting to use to describe companies that have clearly achieved functional excellence: Zen Masters. You don't have to be the biggest; the key to becoming a Zen Master is to achieve superior functional excellence in your chosen sector. That could be a local market, a niche product or brand, or it could be a global brand competing in the whole worldwide arena.
You choose your battlefield. Then you battle for top functional excellence in that area. When you get there, it will be evident; you won't even need to mask your moves or your intentions. They will know it, and so will you.
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