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Beyond the Core: Expand Your Market Without Abandoning Your Roots

Book Description

All companies must grow to survive--but only one in five growth strategies succeeds. In Profit from the Core, strategy expert Chris Zook revealed how to grow profitably by focusing on and achieving full potential in the core business. But what happens when your core business provides insufficient new growth or even hits the wall? In Beyond the Core, Zook outlines an expansion strategy based on putting together combinations of adjacency moves into areas away from, but related to, the core business, such as new product lines or new channels of distribution. These sequences of moves carry less risk than diversification, yet they can create enormous competitive advantage, because they stem directly from what the company already knows and does best. Based on extensive research on the growth patterns of thousands of companies worldwide, including CEO interviews with 25 top performers in adjacency growth, Beyond the Core 1) identifies the adjacency pattern that most dramatically increases the odds of success: "relentless repeatability;" 2) offers a systematic approach for choosing among a range of possible adjacency moves; and 3) shows how to time adjacency moves during a variety of typical business situations. Beyond the Core shows how to find and leverage the best avenues for growth--without damaging the heart of the firm.

Table of Contents

  1. Title Page
  2. Copyright Page
  3. Table of Contents
  4. Preface
  5. Acknowledgments
  6. 1 - The Growth Crisis
    1. The Challenge for Today’s CEOs
    2. STMicroelectronics: Rebuilding the Company Through Adjacencies
    3. The Pressure of Growth Expectations
    4. The Three Purposes of Adjacency Expansion
    5. Playing the Odds
    6. The Pressures for Adjacency Moves
    7. The Vocabulary of Adjacency Expansion
    8. The Promise of This Book
  7. 2 - Visualizing the Ideal
    1. Olam: High Growth from Repeatability in Low-Growth Markets
    2. Sources for Case Studies
    3. How Relentless Repeatability Creates Competitive Barriers
    4. Nike: An Adjacency Athlete
    5. The Myth of the Perfect Company
    6. Mining Customer Insights for Repeatability
    7. Insights from the Customers’ Profit Economics
    8. Insights from Customer Share of Wallet
    9. Insights from Understanding the Customer Life Cycle
    10. Insights from Customer Segmentation
    11. P&G: From Customer Insights into Repeatable Adjacencies
    12. Repeatability: A Practical Side of Core Competences
  8. 3 - Evaluating Adjacency Moves
    1. The Three Pillars of a Successful Adjacency Expansion
    2. Success Factor One: The Best Adjacencies Build on and Reinforce the Strongest Cores
    3. Success Factor Two: Drive Adjacencies Toward the Most Robust Profit Pools
    4. Success Factor Three: Insist on the Potential for Leadership Economics
    5. EAS: A Healthy Path to Growth
    6. The Defensive Side of Adjacencies
    7. Common Pitfalls in the Evaluation of Adjacencies
    8. The Surprising Sophistication of Simplicity
  9. 4 - Orchestrating Adjacency Moves
    1. Importance of Determining the State of the Core
    2. The Harsh Reality of the Weak Follower
    3. The Dreaded Melting Core
    4. The Underperforming (but Strong) Core
    5. Judging the Full Potential of the Core
    6. Adjacency or Core?
  10. 5 - Executing Adjacency Moves
    1. Managing Linkages to the Core
    2. Organizational Repeatability and the New Math of Sustainable Growth
    3. The Role of Complexity Management
    4. The Hidden Costs of Underperforming Adjacencies
    5. Confronting the Paradox of Organization
  11. 6 - Transforming Through Adjacency Moves
    1. Centex Homes
    2. RE/MAX
    3. Beyond the Core
  12. Afterword
  13. Appendix
  14. Notes
  15. Bibliography
  16. Index
  17. About the Author