Translating competitive strength into bottom‐line performance

Abstract

Purpose

At some point in their career, almost all managers will find themselves in a business that is under‐performing relative to expectations. But how do we know whether the expectations are reasonable? How can we tell whether we have an operational problem that requires operational fixes, or a strategic problem that may require a more fundamental change in how we go to market? In this article, Stuart Jackson shows how the concept of strategic market position, together with detailed competitive benchmarking, can provide the keys to answering these tough questions.

Design/methodology/approach

Using the example of luggage company, Samsonite, Jackson shows how in the past, across the board cost‐cutting failed to deliver substantial profit improvements while stifling growth. However more recently, insights into how Samsonite's costs compared to industry peers together with a recognition of the company's untapped strength as a global competitor, have led the company to redesign its overall business model.

Findings

Overlapping regional functions have been eliminated and economies in global sourcing have enabled increased spending to rebuild marketing and sales. The result has been both expanded bottom‐line profitability and an acceleration of the company's growth.

Originality/value

Discusses Samsonite and its redesigned business model.

Citation

Jackson, S.E. (2007), "Translating competitive strength into bottom‐line performance", Journal of Business Strategy, Vol. 28 No. 5, pp. 50-52. https://doi.org/10.1108/02756660710820848