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Tuesday, July 8, 2014
SOMETHING FOR 3PLs
With the new supply chain paradigm, here is more for 3PLs to think about-- From Fortune
Who will the corporate stars be a generation from now? A few early clues.
Landing a spot on Fortune’s annual list of the World’s Most Admired Companies typically requires virtues like a great brand story, a sexy product, and sure-handed crisis management, says Mark Royal at Hay Group, which compiles Fortune’s roster. But it’s also important to have that corporate “it” quality — a mysterious pronoun that, in different years, has meant very different things.
In 1983, the inaugural year of the list (which included just American companies then), such factors thrust IBM IBM-0.51% – a seasoned innovator at the vanguard of a “high technology” wave — into the top spot. In the late ’90s, General Electric GE-1.40%, as steady a financial performer as they came, led the list. Wal-Mart WMT1.08%, which made a virtue out of value, dominated in 2003 and ’04. And from 2008 on, it has been Apple AAPL-1.89% all the way. In this context, “it,” we’re guessing, means the near-freakish ability to reinvent itself.
Hard as it is to define the “it” qualities of the past, the meatier challenge is determining what they’ll be in the future. This year tech companies have swept the top three spots on our list (Apple, Amazon AMZN-3.44%, then Google GOOG-2.63%) and account for eight of our 50 All-Stars. Yet Silicon Valley’s reputational supremacy is hardly assured. Concerns loom over the privacy of user data held by web and social media companies, and over the volatile valuations of many firms; both issues could tarnish the sector’s credibility in the long run.
The only thing certain to happen 20 years from now is that a currently unknown business (or whole category of business) will make the cut, says Andy Brennan, lead analyst at IBISWorld, which projects industry trends. Among this year’s top five companies, four weren’t on the list a decade ago (see chart).
Robert Fronk, SVP of reputation management and public affairs at Nielsen, says that cybersecurity companies may leap to prominence, citing poll data showing that 74% of Americans worry that their personal data will be misused. He also predicts that companies that sell marijuana will become more important as its political acceptance grows, particularly medical marijuana. Indeed, much of the health care industry may get a reputational boost as it adds as many as 5 million new jobs over the next decade.
As for who will be edged off, IBISWorld’s Brennan says fast-food retailers look vulnerable. Increasingly health-conscious consumers, he says, may shun Big Macs for more wholesome fare. (McDonald’s MCD0.13% ranks 22nd on 2014’s list, 10 spots lower than last year.)
Companies that blur industry lines may be especially well positioned. Consider Google, whose ambitions stretch from ecommerce to self-driving. “Who’s a car company now?” asks James Manyika, a director at the McKinsey Global Institute. “I don’t know — Ford? Tesla? Google?”
Perhaps that’s a clue. Maybe not fitting into an easy corporate category is the next generation’s “it.” INDUSTRY SNAPSHOT 2014 Computers, IT, internet services, and retailing: 8 Motor Vehicles: 3 Consumer food products: 3 General merchandisers: 3 Megabanks: 3 Miscellaneous: 30