We talked with Tuomo about the importance of reform and transformative initiatives in the firm.
- Why should reform be topic on every company’s strategic agenda? “Today a lot of enterprise value is created through operational excellence and sales efficiency programs. These type of programs are being published on weekly basis, across industries and also by prospering companies. Sometimes the market gives positive response, sometimes not. But in more advanced business portfolio, reform, or transformation, gets its fair share of investments and also leadership attention. This does not mean that you should forget competitive positioning, synergy, resiliency or value creation views of your business portfolio, they are equally important.”
- What are some of the central questions your clients are struggling with? “I have worked with companies who are eminent in their industries and even dominate in some of their markets, but still struggle to find the initiatives to build their reform agenda. It may be that companies are not comfortable with typical high risk level of transformative initiatives compared to product development in their core. Yet these companies know and may have even seen digitalization to open opportunities for new players, who can win with new approaches. To respond the critical thing is to think what our assets and capabilities could do, if we would enter into new value chains, participate in new business platforms or form a structural partnership with an another industry player? In the end I think you are better of being a disruptor than defending of being disrupted.”
- Why is this important? “Studies show that on average companies investing in transformative initiatives receive better valuation over time when compared to those who do not. If companies would seek transformative opportunities in their value chains or just in their ways of working with the same rigor as they seek opportunities to reduce costs or to be more cost effective, I think a lot of sustainable value is still to be discovered.”