Strategic tools for the practising manager

KIT

This week: The premium footwear market in India

The total market spend for the premium footwear market in India is estimated at Rs 1,644 crore.

Premium footwear seems to be popular with Indian men, with a category engagement of 87 per cent.

The category engagement is much lower for women and currently stands at 53 per cent.

For men, three categories have emerged "" sports, casual and formal. Women prefer to choose from a range of brands, instead of going for a particular brand name.

Sixty-five per cent of premium footwear buying for men is impulse-driven.

The annual per capita spend on a premium shoes by men is about Rs 15,000 compared to Rs 18,200 by women.

The annual spend is highest, that is, Rs 28,000, for women in the 36-40 years age group. This reinforces the fact that even though the number of times they shop for footwear in a year is less, the per transaction value is high.

In the case of men, it follows the same trend, with the spending for up to 30 years age group being about Rs 23,000 on footwear.

NUGGETS
Selections from management journals

In recent years, companies have developed much more sophisticated strategic measurement systems, based on such tools as the balanced scorecard, key performance indicators, computerised dashboards and the like. Nonetheless, there seems to be a widespread consensus that they measure too much, or too little, or the wrong things, and that in any event they don't use their metrics effectively.

Why? On the basis of discussions with hundreds of managers, noted management thinker, author and professor Michael Hammer concludes that the operational metrics that companies commonly use make little or no sense. He has identified seven common mistakes, the deadly sins that seriously impede the relevance and usefulness of operating measures. He also offers managers some means for redemption.

Special report: Measuring to manage "" the 7 deadly sins of performance measurement and how to avoid them
By Michael Hammer, Carole J Haney, Anders Wester, Rick Ciccone and Paul Gaffney
MIT Sloan Management Review, Spring 2007, Volume 48, Number 3
Read the article at http://sloanreview.mit.edu

Three years ago, former US Vice President Al Gore (in the picture) joined with David Blood, the former head of Goldman Sachs Asset Management, to form an investment-management firm dedicated to investing for sustainability "" that is, assessing the way social, economic, environmental, and ethical factors affect the strategy and valuation of businesses.

In this interview, the two men explore the underpinnings of their investment philosophy and discuss traditional approaches to socially responsible investing, as well as society's widening expectations of corporate responsibility. Gore and Blood also delve into their thinking on how to gain superior returns for investors while integrating sustainability into an investment model.

They touch on the effects of long-term investing versus the "short termism" of some investors, discuss the complexity of valuing companies across multiple dimensions of sustainability, and assess the activities of companies that pursue the opportunities sustainability creates.

Investing in sustainability: An interview with Al Gore and David Blood
By Lenny T Mendonca and Jeremy Oppenheim
The McKinsey Quarterly,
Web exclusive, May 2007
Read the interview at www.mckinseyquarterly.com

Most Fresh entrepreneurs face the same problem when starting out on their own: "When you are relatively young, with relatively little experience, and you are relatively poor, and you have an unproven new idea, what do you have to do to convince powerful and rich people to give you the first hundred thousand pounds so you can start developing your products?" says INSEAD Associate Professor of Strategy, Quy Nguyen Huy.

The answer, it seems, is to pay attention to "symbolic management" at the earliest stages of a new venture. That's what Huy and his INSEAD colleague, Associate Professor of Entrepreneurship Christoph Zott, found after studying 26 companies started by INSEAD MBA graduates in London over two years. Many entrepreneurs will instinctively dress smartly to impress investors. But they have to do more when they're long on ideas but short on resources.

Entrepreneurship: Use symbols to attract resources
Insead Knowledge, May 2007
Read the article at http://knowledge.insead.edu/

The sales associate, noticing the approach of a customer, is suddenly intent on restocking merchandise or discussing when she will take her next break "" anything to avoid actual contact with the shopper. It is the type of behaviour that dominates the list of complaints cited in the second annual Retail Customer Dissatisfaction Study.

The study, conducted by Wharton's Jay H Baker Retail Initiative and the Verde Group, found that disinterested, ill-prepared and unwelcoming salespeople lead to more lost business and bad word-of-mouth than any other management challenge in retailing. Survey respondents were not frustrated by sales associates who seemed overworked or outmanned by shoppers. It's the "conscious ignoring" that irritates them most.

Are your customers dissatisfied? Try checking out your salespeople
Knowledge@Wharton,
May 16, 2007
Read the article at http://knowledge.wharton.upenn.edu/