December 2012 NO1
Inside this issue: Entrepreneurship meets strategy | Social media and luxury goods | Technology in education
MBA INTELLIGENCE
December 2012 NO1
Welcome to the first issue of MBA Intelligence A note from the Publisher
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Welcome to the first taster edition of MBA Intelligence. MBA Intelligence is a brand new unique monthly magazine aimed at showcasing great business talent from the leading business schools around the world. It provides prospective, current and past students of the MBA and other business degrees with business and organisational insights gleaned from applying MBA knowledge and skills. In addition, this issue includes reviews of recently published books as picked by MBA students themselves. We hope you enjoy the first edition of MBA Intelligence and to ensure you stay current, informed and connected, you can subscribe to future editions below:
MBA IntellIgence Strategic decisions during market entry and early growth
October 2012
Today, firms operate in increasingly dynamic and turbulent environments characterised by intense competition, uncertain market conditions, faster technological changes and shorter product life cycles (Pinto et al, 2008). Given the challenges these conditions bring to organisations, it is no surprise that business strategy continues to be a widely discussed concept, with varied perspectives and schools of thought. Faced with such market turbulence and with divergent views on strategy, those responsible for crafting company strategy face a significant and complex challenge.
Strategic decisions during market entry and early growth
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An analysis of how Jimmy Choo has responded to the challenges in marketing management for the 21st century.
Jimmy Choo – best foot forward
Submitted By: Alysia Watson
The luxury brand market relies on the ability to build and maintain an identifiable cachet that resonates with a desired target market. The challenges faced by many luxury brands’ marketing strategy for the twenty first century have been magnified by the financial downturn and the increased threat of competition posed by the increase in globalization and from lower value reproductions from mass-marketed brands such as Zara and LK Bennett. This paper will look at how Jimmy Choo has met these challenges through a more integrated marketing approach, the use of social media, collaborations, and product segmentation.
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MBA IntellIgence
October 2012
Teaching Digital Natives Mobile Device Dilemmas An analysis of Malaysia’s radical Primary Education agenda Even in developed economies effective teaching can be elusive - perhaps because educational systems were designed during the industrial era - when “education” only happened at school and jobs were “for life”. In today’s fast paced world jobs change frequently and we are routinely expected to handle large quantities of data, disciplined, robust and
For any questions or further information contact us at editor@redwoodapps.com
Classroom 100 years ago
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Classroom today
n Malaysia however, the traditional approach to Primary School1 learning is being seriously examined, Malaysia is one of the few countries that spends more on education than defence and one of the world’s first to introduce a national 4G wireless network potentially giving students high speed internet on the move. Malaysia is creating conditions for a significant change in educating its children and future citizens - what role can mobile devices play?
Teaching Digital Natives - Mobile Device Dilemmas
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MBA Intelligence is published monthly by Redwood Apps Limited. MBA Intelligence reserves the right to prohibit the reproduction of the magazine in any manner, whole or part. MBA Intelligence considers its sources reliable and verifies as much data as possible, although inaccuracies can occur; consequently readers using this information do so at their own risk. Although persons and companies mentioned herein are believed to be reputable, MBA Intelligence does not accept any responsibility for their activities.
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MBA IntellIgence
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December 20122012 no1 October
What are MBA’s reading now
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What are MBAs reading now?
MBA INTELLIGENCE
December 2012 NO1
Editorial Welcome to MBA Intelligence, a new magazine for the global MBA community. In business schools across the world the MBA curriculum challenges students to apply their analytical skills to contemporary organisational issues - and it is about time the best of those insights were shared. MBA Intelligence is the means to that end – for readers it is a way to learn how the theories, tools and techniques of the classroom get applied and for contributors it is an opportunity to showcase your talent to an international audience. For all of us, MBA Intelligence creates the town square of our global community. In this edition we are delighted to feature the work of MBAs and authors from Cass Business School. An integral part of City University London, Sir John Cass Business School is among the global elite of business schools holding the gold standard of ‘triple-crown’ accreditation from the Association to Advance Collegiate Schools of Business (AACSB), the Association of MBAs (AMBA) and the European Quality Improvement System (EQUIS). Many thanks to Cass Business School for the contributions already received – and we know that Cass MBAs are also looking forward to reading the work of their peers across the MBA world.
The Editor editor@redwoodapps.com
Contributors Simon Feeney: Having spent 6 years working for the Reed Group in various management positions, Simon recently completed a full-time MBA at Cass Business School, London, with strategic management as his primary area of interest.
Tariq Isa: Tariq is a serial entrepreneur having started his first business at age 23. Before completing his MBA at Cass Business School this year, he cofounded one of the leading digital learning system providers for the UK.
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Alysia Watson: Alysia recently completed a fulltime MBA at Cass Business School, and prior to this she spent over 10 years working in the banking industry with a focus on leveraged buyouts.
MBA INTELLIGENCE
December 2012 NNOO11 October December 20122012
Strategic decisions during market entry and early growth Today, firms operate in increasingly dynamic and turbulent environments characterised by intense competition, uncertain market conditions, faster technological changes and shorter product life cycles (Pinto et al, 2008). Given the challenges these conditions bring to organisations, it is no surprise that business strategy continues to be a widely discussed concept, with varied perspectives and schools of thought. Faced with such market turbulence and with divergent views on strategy, those responsible for crafting company strategy face a significant and complex challenge.
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December 2012 NO1
Whilst strategic challenges are of interest to all managers, entrepreneurs could arguably face the greatest challenge of all. In most circumstances these individuals face a significant burden of risk, with limited chance of success. Hall and Woodward (2010) demonstrate that the reward to entrepreneurs who provide the ideas and long hours in venture funded start-ups is zero in almost three-quarters of occasions, and small in general once idiosyncratic risk is taken into consideration. However, they also note that the average cash reward to an entrepreneur in a company that succeeds in landing venture funding is $5.8m. Many entrepreneurs start their companies with a planned early exit in mind, but shaping and structuring start-up and early stage companies for fast growth is a complex and difficult challenge. This article provides assistance for budding entrepreneurs hoping to optimise their business’ market entry and early growth strategies. ‘It must be remembered that there is nothing more widely discussed concept, with varied perspectives difficult to plan, more doubtful of success, nor more and schools of thought. Faced with market turbudangerous to manage than the creation of a new lence and with divergent views on strategy, those system. For the initiator has the enmity of all who responsible for crafting company strategy face a sigwould profit by the preservation of the old institunificant and complex challenge and entrepreneurs tions, and merely lukewarm defenders in those who could arguably face the greatest challenge of all. would gain by the new ones. The hesitation...arises... In most circumstances entrepreneurs face a sigin part from the general nificant burden of risk, with lim“It must be remembered ited chance of success. Hall and scepticism of mankind, which does not really bethat there is nothing Woodward (2010) demonstrate lieve in an innovation until the reward to entrepreneurs more difficult to plan, experience proves its valwho provide the ideas and long ue.” (Machiavelli, c1513). more doubtful of success, hours in start-ups is zero in alMachiavelli was writing most three-quarters of occanor more dangerous in the 16th Century, but his sions. Their work is based on the concept remains contemto manage than the study of 22,000 US companies porary. Although change that received venture funding is normalised within busi- creation of a new system.” over a 20-year period, and does ness, entrepreneurs bringnot even factor in the thouMachiavelli, c1513 ing new products or sersands of small businesses that vices to market still face fail without reaching this stage. tremendous challenges in scaling their businesses to However, they also note the average cash reward to bring significant success. How to do this - the busian entrepreneur in a company that succeeds in landness strategy – is hotly debated among academics ing venture funding is $5.8m, which, given the large and practitioners alike. proportion that fail, indicates an attractive outcome Today, firms operate in increasingly dynamic and for those entrepreneurs who do succeed. When it turbulent environments characterised by intense comes success comes quickly, with more than a competition, uncertain market conditions, faster quarter of the total value arising from companies technological changes and shorter product life with venture lifetimes between one and two years. cycles (Pinto et al, 2008). Given these conditions, it Many entrepreneurs start their companies with a is no surprise business strategy continues to be a planned early exit in mind, but shaping and struc-
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turing start-up and early stage companies for fast Writing a business plan is a key factor of success, but growth is complex and difficult. These individuals the depth and detail required is less than may be extypically require substantial help (Turner, 2006) and pected. The purpose is to formalise an ultimate goal so in the summer of 2012, I conducted a study into combined with initial ideas for how that goal may be strategy in early stage businesses for my MBA theachieved. A danger for small businesses is they can sis. Firstly, I researched and conbecome too reactionary to environmensolidated a vast array of existing Writing a tal changes, and a formalised business academic theories. Secondly, I plan is a key reference tool that can prebusiness plan interviewed relevant practitionvent this. A plan is also usually required ers, including successful entrepreshould act as to secure funding but VCs do not require neurs, founders of current startlarge, complex plans. They are mainly a ‘compass’ as ups, financiers and consultants. looking for a scalable business idea with Thirdly, I applied my findings to opposed to a market appeal, typically pitched within a detailed company case study. the context of a competitive environ‘map’ ment to help create a framed point of refWhilst there are limitations to the methodology, primarily relating erence. However, analysis should be kept to sample size and selection bias, eight generic key as broad as possible regarding the focal industry and lessons emerged. not be so deep that it delays action for too long. A tenpage business plan is suggested as sufficient. Writing a business plan is typically an imporOnce a plan is in place, it is typical that divergences tant factor of success, but it should act as a occur almost immediately, with one serial entrepre“compass” for the business as opposed to a neur suggesting he rarely implements more than 50% “map”. of an original plan. Divergences often occur because In fast-moving environments is there time for the type what customers say in research is not then reflective of detached, formal analysis many traditional strategy of their purchasing behaviour and because environmodels require, or should companies just start actmental changes block paths and create new opporing, learning and developing in an iterative manner? tunities. However, entrepreneurs should always work Should companies bother writing a formal, detailed towards the core essence of the plan. Like mountain business plan, given its contents may quickly become climbers who find their route has become impossible obsolete? Should a business plan be linked directly to to navigate, entrepreneurs may have to try a different the strategy? path; however, their goal of reaching the top never Whilst individual responses to these questions will changes. They should remain open and flexbe both subjective and contextual, firm trends ran ible to adaptive development, whilst through my research results. Typically it is suggested also ensuring that their business entrepreneurs should use a range of formal strategic does not become too reactionary models when initially scoping the market opportuto outside pressures, or does not nity and potential, but should not get immersed in lose its core focus. Under this too much analytical detail – to the point where the context, strategy can be viewed turbulence of the environment means the opportuas a “compass” rather than a nity shifts or is missed altogether. More important for “map”. start-ups is to begin “strategising” (Whittington et al, Entering with a 2006) – to begin speaking to customers, developing disruptive prodand testing products, gaining feedback and building uct can bring signetworks. nificant success but the
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market education period is likely to be long and ure is considerable, as demand uncertainty exists. painful, thus companies adopting this approach In today’s competitive environment, a durable adwill need significant funding. This funding can vantage is often not feasible, but a strategy aiming be hard to obtain as the product will not have a for a “first mover/short term advantage/early exit” proven market base. approach can be extremely successful. By following This finding stems from research carried out by Kim this planned strategy, companies tend not to focus and Mauborgne (1997) in which they note that sucon erecting too many barriers to entry, or on buildcessful high-growth companies paid little attention ing sustainable business foundations, but instead to matching or beating their rivals. Instead, they focus on developing and marketing an attractive sought to make their competitors irrelevant by offerproduct or service proposition. Quickly capturing ing a significant leap in value. However, the key chala significant amount of market attention and posilenge is to persuade others of the benefits of this tioning for a trade sale can lead to large exit values, leap. My research identified that the most successful with the acquirer then left to worry about maintaincompanies do tend to offer a leap in value, but in ing the advantage. most cases they have to go through a long and arduous period of market education. A lack of finances As companies move to survive this period is cited as from the initial comthe downfall of many businesses. My research identified mercialisation of prodA “safer” path can be to provide an ucts to scaling, their customthat the most ers may change, and this enhancement to existing offerings. Many companies succeed in this successful companies may require a fundamental manner, and it is also the approach business model adaption. do tend to offer a leap that is easiest for VCs to fund, as itIdentifying the need for this erations on existing models (therechange and executing it can in value, but in most fore with an established base debe a defining moment in a cases they have to go start-up’s evolution. mand) are less risky than disruptive products with no proven market. As the work of Baden-Fuller through a long and and MacMillan (2011) highWhilst first-moving does arduous period of lights, business models have not always provide a susevolved in recent times, with market education. tainable advantage, siginnovative approaches meannificant success can result from a ing the user and the customer “first moving-rapid scaling-early exit” approach. are not always the same stakeholder. Google sits as As noted within the work of Suarez and Lanzolla an obvious example here with the customers being (2005), first-movers have more time than later enthe advertisers, and the users the general public. A trants to accumulate and master technical knowlless obvious example is Ryanair, in whose early days edge, and this can lead to a technical edge over the customer was the local Governments or develcompetitors. They also have first access to scarce asopment boards of the areas surrounding the provinsets, and are able to build an early base of customers cial airports it flew to; its passengers the users. who would hopefully be retained in the face of comUnderstanding who the customer and user are is petition, whether through loyalty or high switching an important success factor, but entrepreneurs must costs. However, on the other hand, the market may also understand that these may change over time, not be ready for the product; development and proespecially through the three key stages of prototypmotion costs are likely to be high; and the risk of failing, commercialisation and scaling. As Baden-Fuller
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and MacMillan (2011) point out: many companies have a point of reference so removed from the reality are successful at the first two stages, but “few make of early stage business that their recommendations it to the last stage, when identifying the right scaling can actually be a strategic distraction. customer is essential. Scaling customers provide the Bringing in non-execs as a means of gaining clinecessary funds for this last rapid growth stage.” It ent access can also have varying levels of success, is important to note that the scaling customer may as the purchasing mindset can be weak if meetings require a significant shift are only agreed to as a favour to the Understanding who referring Director. In addition, having in business model, sometimes even adapting the those networks to access can be more the customer and user business from a b2c to a important in b2b environments than are is an important b2b model or vice-versa. when the customers are direct consumers. The role of the Board member as a success factor, but Focus is the key to coach and mentor to the entrepreneur early success and entrepreneurs must is identified as the most important funcmost successful as growing a business is tough, and also understand that tion, start-ups begin by doma founder has a limited number of peoinating a small, defined these may change ple who they can turn to for advice. niche segment. over time The work of Geoffrey Obtaining the right amount of Moore in the 1990s on investment from well chosen fi“Crossing the Chasm” remains relevant and impornanciers is a vital success factor tant in today’s business world. In such a turbulent – too much money can be as damaging as too litenvironment, “focus” is one of the most important attle, and some financiers are better positioned to tributes for a start-up. Entrepreneurs should identify assist certain exits through their networks. a specific customer and focus on solving the probSecuring funding is often a pivotal moment for a lems fully for that customer. start-up, with the funds becoming available to support product development and early stage scaling. Bringing in a non-exec Board can be an adSecuring funding can also help focus strategy: as vantage through the provision of mentorthere is only so much that can be achieved with each ing, expert knowledge and business contranche, companies focus on a staged development tacts, but the decision of who to choose is highly approach instead of trying to “conquer the world in important. Providing mentoring support is sugone giant leap”. gested as the most important service to purchase However, it is important for entrepreneurs to fully through this process. understand that as soon as investment is secured, Having advisors is an essential suctheir company effectively becomes up for sale, cess factor for entrepreneurs, whether that is through acquisition, IPO or fire-sale. but the choice of whom to There is also a real danger of companies having “too bring on board is critical. much” money up front, which can cover up ineffiSometimes non-execs who cient practices and poor strategic decision making. have senior management It is important for companies to be revenue focussed experience in large comfrom the outset, and an early need to sell often panies, but with no dimeans that the product is put in front of customers rect experience in enearly, and these customers then provide feedback trepreneurship, can that helps enhance further developments.
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It is my belief that to optimise market entry, firms should ask honest questions about how much funding they need and seek the optimal amount from a provider that can also add value to the business. Some funders have closer links to certain companies than others, and will therefore be able to offer greater support when seeking a trade sale. This is often termed “accepting smart money�.
they can only be offered a sub-market salary, share options of a currently worthless business, and the promise of long hours with limited comforts. It is essential therefore, for entrepreneurs to have a compelling vision for the company that garners confidence in future success (and thus financial reward), and strong values that engage staff. This will often be driven by an obsessed and passionate founder, who is prepared to take a decisive decision making role. This decisiveness should be applied to any nonperformers, who should be changed out quickly. Whilst it is not possible to provide a blueprint, entrepreneurs that consider these eight concepts are likely to increase their chances of success. Unfortunately, even then, starting a business remains a risky proposition, and it will be the contextual decisions made relating to specific opportunities that will ultimately determine success.
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Getting the right people on board early is imperative - ensuring complementary skills are procured to ensure the company has the full mix of technical, sales and operational capabilities. Whilst often overlooked as a strategic consideration, possibly as it’s deemed obvious, effective recruitment is the most cited critical success factor for early stage businesses. The best people are needed, but
Simon Feeney Simon recently completed a full-time MBA at Cass Business School, London, where he was accepted as an academic scholar. Whilst the Cass MBA is generalist in nature, Simon used his elective choices to focus on strategic management, with this being his primary area of interest. Prior to joining Cass, Simon spent 6 years working for the Reed Group, where he progressed rapidly through a range of management positions in both commercial recruitment and government outsourced welfare contracting. Using the MBA as a platform for transition into a new industry, Simon has since joined Virgin Atlantic Airways in a strategic procurement management capacity
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MBA INTELLIGENCE
December 2012 NO1
An analysis of how Jimmy Choo has responded to the challenges in marketing management for the 21st century. Submitted By: Alysia Watson
The luxury brand market relies on the ability to build and maintain an identifiable cachet that resonates with a desired target market. The challenges faced by many luxury brands’ marketing strategy for the twenty first century have been magnified by the financial downturn and the increased threat of competition posed by the increase in globalization and from lower value reproductions from mass-marketed brands such as Zara and LK Bennett. This paper will look at how Jimmy Choo has met these challenges through a more integrated marketing approach, the use of social media, collaborations and product segmentation.
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J
immy Choo was born from the collaboration between Tamara Mellon and Jimmy Choo in 1996. The company started as a result of an ‘outside in’ approach following the recognition of a gap in the market for sexy, stylish and innovative shoes that would meet the needs of today’s women. Originally positioned as a luxury shoe manufacturer, famed for designing shoes for the late Princess Diana as well as being a regular feature on ‘Sex and the City’, the company has expanded its product portfolio to include a range of shoe collections for men and women, bags, sunglasses, perfumes as well as other accessories. Designing and managing integrated marketing communications Despite a lack of history and lineage, Jimmy Choo has been able to create and establish a strong brand position by employing a consistent targeted marketing message and utilizing a mix of media including online, in store, celebrity endorsement, direct mail and magazine editorial coverage. To maximize brand recognition, marketing messages are often kept consistent in style from season to season. This consistency allows consumers to quickly identify with the Jimmy Choo brand and why it is well known today for its advertisements featuring stylish women in evocative
backgrounds, wearing bright coloured shoes. An effective part of Jimmy Choo’s marketing strategy has been the use of celebrity endorsements, which generates significant press coverage and has been a fundamental driver of its position in the current market relative to its competitors. The importance of integrating celebrity endorsements as part of the overall brand communication is so that the brand’s message stands out among the clutter of advertising from competitors and convinces consumers of the credibility of the brand’s offering1. Successful and well-known product placements have included ‘Sex and the City’, ‘Legally Blonde’ and ‘Desperate Housewives’. The increase in technology has resulted in consumers being more information and communication savvy, impacting the way a company markets their products. Jimmy Choo responded to this trend by gearing its marketing mix towards social media and received the ‘Innovation in Social Media’ award in 2010 from Econsultancy2. Jimmy Choo has embraced social media platforms such as Facebook and Twitter as an innovative way of interacting with its consumer base. A study completed by the Digital Luxury Group (2011), looked at the impact of social media on customer behaviour of top brands in the luxury shoe industry. The research showed that Jimmy Choo has a strong brand engage-
Chart 1: Brand Engagement and Popularity on Facebook
0.9% Rene Caovilla
Engagement Rate
0.7% 0.5% Roger Vivier Walter Steiger Sergio Rossi 0.3% Giuseppe Zanotti Ferragamo Gina Shoes Charlotte Olympia Stuart Weitzman 0.1% GianMarco Lorenzi -0.1% 0
Brian Atwood
200,000
Louboutin
Jimmy Choo
400,000
600,000
Fans
800,000
Source: Digital Luxury Group3
Click on chart to enlarge
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Chart 2: Brand Engagement and Popularity on Twitter
0.4%
Engagement Rate
Charlotte Olympia 0.3%
0.2%
0.1%
Stuart Weitzman Giuseppe Zanotti
Louboutin
Walter Steiger Jimmy Choo
Pierre Hardy 0% 10,000
10,000
30,000
50,000
70,000
90,000
110,000
Followers
130,000
150,000
Source: Digital Luxury Group3
Source: Digital Luxury Group3
Click on chart to enlarge ment rate and popularity on Facebook on par with Louboutin and well ahead of other luxury brands in the sector, excluding heritage brands such as Chanel, Dior and Gucci. The study also showed that Jimmy Choo’s popularity on Twitter, while second to Louboutin, showed lower levels of engagement. This highlights a potential growth area for Jimmy Choo to improve brand engagement going forward. Jimmy Choo has also been successful in using social media to create interest, customer hype, and as a unique way for its clientele to interact directly with the brand prior to the launch of new product lines. In April 2010, Jimmy Choo launched the ‘CatchA-
H&M
Choo’ campaign, an offline event whereby a real time treasure hunt was organized where people physically chased a pair of trainers in London using location based clues on Twitter5. The competition lasted three weeks and was successful in creating the desired level of media association and sales. The competition resulted in 250 different blogs covering the campaign, it was the most accessed story on PR Week’s news, and daily trainer sales in-store went up 33% after the Evening Standard also covered the story6. The campaign was an innovative and effective way to communicate so fans of the brand would relay the information over the Internet, allowing Jimmy Choo
Hunter
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to launch a new line with sigCollaborations Over the last few nificantly more coverage than In addition to its successful use years Jimmy Choo it would have received with ads of social media and marketing in regular magazines. Additionto build its brand awareness, has undertaken ally, luxury brands are all about Jimmy Choo has also engaged ‘the experience’. The use of a collaborations with in the use of top end masscleverly designed social media collaborations with three iconic brands market campaign allowed Jimmy Choo high street brands. This more to engage with fans both onincluding H&M (2009), recent marketing phenomeline and offline raising brand non resides on the mass-marHunter Boots (2009), awareness, and allowed its fans ket model. High street brands to learn how to lead and experiand UGG (2010) are able to stand out from the 7. ence the Jimmy Choo lifestyle crowd and designers benefit Overall, the successful interfrom opening up their labels play of its marketing strategy, both offline and onand create new revenue streams from aspirational line, and using these creatively, has lead to increased buyers who may not have previously been able to recognition and growth for the company and has set access the brand. It also saves designers from having Jimmy Choo apart from its competitors in the curto create costly sub brands that serve to undermine rent economic environment. the integrity of luxury status brands, an example are the many sub-brands of Ralph Lauren8.
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In the past few years Jimmy Choo has undertaken ing fashion outlets or on internet sites such as Net-acollaborations with three iconic brands including Porter. By creating this collection, the company was H&M (2009), Hunter Boots (2009), and UGG (2010). protecting its financial position whilst still maintainIt could be argued that the collaboration with massing its luxury status. Additionally, the lower price market brands is inconsistent with a luxury brand’s point aids in reducing competition from reproducimage, potentially resulting in brand dilution. Howtions that have plagued other luxury brands such ever, the success of the Jimmy Choo collaborations as Louis Vuitton. Pricing quality, branded shoes that has shown that the creation of limited editions and are in high demand at a reasonable price has helped unlikely strategic partnerships is a way of leveragsteer consumers back into Jimmy Choo stores by ing their image, disrupting established sectors and making cheaper reproductions a less attractive alter9 opening themselves up to new audiences. Most imnative. portantly, it increases word of mouth advertising by The Choo24:7 collection is also a product differengetting consumers talking about tiation strategy, aimed at slowthe brand over others. This marJimmy Choo appears ing and reducing value migraketing strategy also allowed Jimtion from its more top end to have a clear range of shoes, by creating a my Choo to build depth in the market and access the aspirahorizontal product range that understanding of the tional buyers whom it previously includes various heel heights, forces that lead a had not tapped. fabrics and colours for each style, whilst being manufacmarket to commodity Product Segmentation tured with the same quality, status putting pressure care and detail as the main Jimmy Choo appears to have a clear understanding of the forces collection11. This segmentaon high premium that lead a market to commodity tion strategy addresses constatus putting pressure on high brands cerns that Jimmy Choo could premium brands, particularly in be viewed as moving out of the context of the current ecoor away from the luxury brand nomic environment and increased globalization, status. Similar brand houses have achieved this, for introducing more brands for consumers to choose example Donna Karen and DKNY. from. To address the financial downturn, reduce the threat of competition and cheaper reproductions, Reinforcing its Luxury Brand Position Jimmy Choo introduced a new collection in 2009 The Digital Luxury Group (2011) research showed called Choo 24:7. that Jimmy Choo is the second most searched for The Choo 24:7 is a collection of basic modern shoes shoe brand in the heritage category, ahead of Saland bags that were designed not to go out of fashvatore Ferragamo, Tod’s, and Manolo Blahnik12, conion. The collection signaled to its clientele that the firming the brand’s salience amongst consumers. In pieces are an investment and not a fast fashion item, addition to classic brand imagery of its marketing 10 hence confirming the price point of £335-£560 . campaigns, strong celebrity endorsements have The collection also served as a new pricing strategy helped to build the Jimmy Choo brand. that would reduce the incidence of discounting as To cement and reinforce the position of Jimmy the shoes would move from season to season withChoo in the luxury market, the company launched out the need to be marked down. Previously, many the ICONS range in 2011, a capsule collection of luxury brands fell victim to high fashion items and shoes inspired by the most significant creations from excess stock was sent to the many global discountthe company’s archives13. The launch was unveiled
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by a series of images by fine art photographer Nan Goldin to be featured in a global advertising campaign14. As Louboutin has its signature red sole to identify the brand, Jimmy Choo has its iconic styles that it is reinforcing to the market via this re-launch. Issues for Jimmy Choo going forward It has been shown that Jimmy Choo is well ahead of many other luxury brands in terms of social media coverage and its ability to engage with its consumer base. To overcome many of the challenges faced in the twenty first century, Jimmy Choo has embraced and utilized social mediums in a unique and innovative way to launch new products, collaborated with mass market producers to open up new channels, and responded to the market downturn and competition with the launch of Choo 24:7. However, going forward, the brand faces a number of challenges. Of particular note is the departure of CEO Tamara Mel-
lon. As the face of Jimmy Choo and self-promoter of the brand, it will very much depend on whether its new owners, Labelux, will opt to bring in a new face, raising questions over whether consumers will accept a new front or if they will rely solely on celebrity endorsements. A second key issue is its ability to maintain its luxury brand status and continue to build its brand equity. The launch of the ICONS collection, continued focus on designing innovative and stylish shoes and celebrity endorsements, will go some way in cementing its position but this will depend on competition and potential dilution if the company focuses too heavily on mass market products. Lastly, in order for the company to grow, it will need to conquer the Asian market, which it hasn’t yet achieved in full. Asia is the luxury brand capital and its place alongside Louboutin will ride on its success in this region.
Alysia Watson
Alysia recently completed a full-time MBA at Cass Business School. Prior to completing her MBA, Alysia spent over 10 years working in the banking industry with a focus on leveraged buyouts. Alysia is now a Partner and Director of Finance of a start-up business. Alysia also has a Master of Applied Finance and a Bachelor of Commerce (Economics and Finance) from the University of Western Sydney, Australia
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WRITE FOR US MBA Intelligence is looking for people to contribute to future issues with articles demonstrating how MBA knowledge and tools can be practically applied. Whether you’re a prospective, current or ex MBA student we’d love to hear from you. With a global reach via the Apple Newsstand MBA Intelligence provides an unparalleled platform to showcase your expertise. We are looking for articles drawn from, but not limited to:
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Teaching Digital Natives Mobile Device Dilemmas An analysis of Malaysia’s radical Primary Education agenda In today’s fast paced world in which we are routinely expected to handle large quantities of data, and where jobs are no longer “for life”, educational systems founded in an industrial age are becoming out of date. In an era where disciplined, robust and independent learning have become essential tools for survival, this paper explores the role of mobile technology in Malaysia’s progressive plans for primary education. Submitted By: Tariq Isa
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There is a long list of benefits of the benefits of mobile learning; the traditional form of classroom instruction does not activate all learning styles (e.g. a student cannot review the class after school using audio or video). Mobile learning uses multimedia formats and can be accessed any time during or after class (e.g. an auditory learner may listen to a podcast on the way home). mobile devices open up the possibility of bringing geographically dispersed located learners, such as rural students, into a single learning community. This is particularly true in developing economies such as South Asia, where barriers to learning such as clean, safe buildings, regular electricity supply and lack of landline connectivity are overcome through the use of mobile learning. mobile learning has also brought into the mainstream learners who have had difficulty or have lacked confidence in engaging in formal learning, travelling communities and marginal groups. ‘flipping the classroom’, where more advanced students have used mobile devices to do their work and the teacher is able to focus in class on students who needs the most help.
In Malaysia, however, the traditional approach to Primary School1 learning is being seriously examined. Malaysia is one of the few countries that spends more on education than defence and was one of the world’s first to introduce a national 4G wireless network, potentially giving students high-speed internet on the move. Malaysia is creating conditions for a significant change in educating its children and future citizens, so what role can mobile devices play? In many parts of the world teachers are now facing ‘Digital Natives’, the term used to describe the generation that have embraced technology in ways that they, as ‘Digital Immigrants’ cannot fathom. This terminology usefully differentiates the perspectives of two communities interacting in a learning environment. As a result, educational institutions are facing discontinuous innovation - Bessant’s (2005) definition of a state in which a dramatic shift in the market takes place. This could be a technological shift or the emergence of a totally new market, and educational institutions are now servicing a new set of customers who are habitually using technologies the institutions are unfamiliar with. This creates uncertainty about how to provide services and about what services customers want. Without this thinking, there is a real risk learners will not acquire the skills they will need for life beyond formal education.
helping children become more organised, facilitating collaborative learning, helping save money on textbooks and improving literacy. removing the stigma of being a lower performer; helping children with special needs.
Thai Government purchased 2m tablets for its primary school children
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Dyson (2010) argues the teacher should provide students with a greater sense of individual freedom, self-paced working and autonomy, suggesting teachers need to act more as mentors, guiding students to learn the art of self-discipline. Negas et al (2010) postulate that mobile learning will support this outcome and facilitate the creation of a richer pedagogic offer more in line with students’ experiences outside the classroom, providing a quicker, simpler and more flexible means of accessing information. Thai Government purchased 2m tablets for its primary school children Research on initiatives around the world indicates that governments, school districts and individual schools are willing to invest considerable resources to support the use of mobile devices in the classroom. There have already been several initiatives in Malaysia as well as across Asia and America and schools are already beginning to see the benefits. But achieving widescale adoption faces significant challenges such as convincing stakeholders, many of whom are yet to be convinced of the benefits of using mobile devices in the classroom. Other issues include lack of content, which needs to be to be used efThere is no adapted fectively through moescaping use bile devices which have a smaller screen; device of mobile diversity (especially if technology students’ own devices are being used), which in education means content needs to through the be able to run on multiple operating platforms, growth of browsers and screen sizeducation es; ensuring all students have access to mobile related apps, technology; and, finally, and personal safeparticularly at online ty such as bullying and primary level accessing inappropriate content.
Many teachers are still to be convinced of the benefits of mobile learning Part of the process of understanding how mobile technology could realistically have an impact on learning involves looking more deeply into mobile media. Analysis of the development of mobile operating systems and “app stores”, the growth of education related apps specifically and the utility of education apps beyond a formal education context is needed to assess viability of the strategic and operational approach and the commercial opportunities it will bring. There is no escaping use of mobile technology in education through the growth of education related apps, particularly at primary level. The changing needs of Digital Native students is now well documented and it is inevitable that schools need to adapt if they are to keep pace with this change. Yet even with the political support to implement large-scale projects there still remain significant challenges and a number of areas still need further development. These include a closer look at local factors where a one-size-fits-all approach many not be appropriate for different countries and economic regions; obtaining more hard evidence, as much of the evidence to date is still anecdotal; developing an environment where innovation can be sustained in the long term; managing device diversity either by eliminating it or developing solutions that cater for it; and, finally, getting the support of all stakeholders including parents. Transferable approach I conducted a wide-ranging and in-depth literature review from academic journals, research papers, lecture notes and textbooks from two core MBA disciplines, Organisational Behaviour and Innovation, to help frame and underpin my core arguments. This helped me understand education learning theories and how educational organisations could learn to drive pedagogical innovation to help teaching make a deeper impact with a greater number of students. I used an inductive research approach to collect data, which was conducive to the devel-
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MBA INTELLIGENCE opment of new ideas and approaches. One of the major difficulties I faced was that there is not enough hard evidence as to the impact of mobile learning particularly in Malaysia, as it is a relatively new field. Much of the evidence therefore was drawn from pilot projects around the world.
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“New technologies make materials vivid, easy to access, and fun to play with - and they readily address the multiple ways of knowing that humans possess. Moreover, for the first time ever, it is possible for teachers and other experts to examine the work efficiently, at long distances, and to provide quick and relevant feedback in forms that are useful to students.” Howard Gardener (2000)
Key Literature Howard Gardener (2009) argued our perception was traditionally that intelligence could be measured by a narrow set of criteria - reading, writing and arithmetic skills, and a person’s ability to succeed judged accordingly. According to Gardener, there are nine intelligences (linguistic, logical-mathematical, musical, spatial, bodily-kinesthetic, interpersonal, intrapersonal, naturalist and existential) and nobody is good at them all (for example, a child may not speak a language properly but may play music magnificently). Gardener (2008) further postulated that due to an increasingly globalised, interconnected and uncertain world, where knowledge accumulates quickly, that much of a person’s education is self-education after formal education. Gardener’s “Five Minds” (The Disciplined Mind, The Synthesising Mind, The Creative Mind, The Respectful Mind, The Ethical Mind) are skills or
competencies young people need in order to be able to learn the art of self-discipline and become effective selflearners. Gardener (1996) argues multimedia technology can be used to help students gain a deeper understanding in the major ways of thinking that have developed in the disciplines. For example, a textbook’s account of history about a particular battle will intimate there is a single, authoritative account rather than encouraging students to weigh evidence and come to their own conclusion. Students will understand the book’s account in different ways, because they have different intelligences and are likely to view the account with different stereotypical habits of thought and conceptions formed early on in their lives: Multiple Intelligences theory has implications in the way technology is used to develop new ideas and approaches in teaching. Gardener argues any serious implementation of Multiple Intelligences theory in education needs to consider: • making education as individual as possible, especially through the use of computers. • a commitment to convey critical concepts and ideas via a number of different formats, thus activating multiple intelligences, reaching more students and enabling them to understand a topic deeply. • the development of computer software or
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For Malaysia, several recommendations emerged from this research: Developing a localised strategy for Malaysia, as there are few international precedents (for example, introducing a step-by-step approach, ensuring equitable access, putting in place adequate security measures, developing acceptable use policies, provide incentives to local businesses and learning lessons from pilot projects). Devising a professional development programme for Malaysian teachers (for example, what kinds of teachers there are and their level of ICT confidence). Devising a strategy for sharing knowledge, particularly with teachers outside Malaysia; building teachers’ confidence with mobile technology by aligning the curriculum with the use of mobile technology and involving teachers in the development of content; fostering pedagogical innovation by developing a culture of innovation within the organisation particularly in areas (for example, more engaging learning content, new ways of assessment, enabling students to become more robust independent learners using mobile technology without teachers feeling their jobs are at risk, encouraging students to learn more collaboratively); and standardising technology that helps overcome device diversity and ensures equity of access, which also promotes the development of a new market for content apps.
virtual environments that are able to teach the same topic through the “activation of several intelligences”. Gardener argues there are inherent risks of using new technology to advance learning. For example, technology must be used with educational goals in mind not for the sake of using technology itself; students might become more attracted to the medium itself than the content; creating graphically rich content could be time consuming for the author; and technology such as slide projectors and television have been used to deliver the same ‘old style’learning and have had little impact on learning. Primary schools provide a useful context for research because they represent the most homogeneous segment of the Malaysian education market. 1
Tariq is a serial Entrepreneur. He started life working as an Area Sales Executive for Shell Pakistan before starting his first venture at age 23 producing garments for export from Lahore, Pakistan. He then co- founded UK based FrogTrade Ltd in 1999 presently one of the leading digital learning system providers for UK government schools. Tariq worked there for over a decade before commencing a full time MBA at CASS Business School 2011-12. He presently lives in Malaysia with his wife where he is working on his next venture.
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What are MBAs reading now
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In this section of the magazine, MBA Intelligence will be providing a monthly digest of recently published books that are making waves amongst MBA students. With a snapshot of the book content and concise reviews, MBA Intelligence strives to keep you up to date with new publications pertinent to the MBA.
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December 20122012 NO1 October
ERA OF GLOBAL TRANSITION: Crises and opportunities in the new world The 21st century’s greatest challenge for business leaders Organizations face a seismic shift in the world order, which will take us into uncharted territory. A world crafted primarily by the US is now fading; an untested multipolar world, designed by new architects is taking its place. Steering organizations through this period of transition will be the greatest challenge for business leaders this century. Dr. Robert Davies critically explores research and thinking, and provides readers with new tools that address the four central questions that every business leader must answer: • Who are the new global architects? • What partnerships could they form to reshape our world? • How will these partnerships influence the global business environment? • Do we face a peaceful or fractious, conflict-ridden transition to a new world? Uniquely, the Era of Global Transition provides a structure that allows readers and their teams to develop a totally new strategy that will help their organizations face an unexplored world. “Robert Davies provokes the reader in a manner that no business thinker has succeeded in doing since Michael Porter revolutionised our understanding of competitive strategy.” Sam Kingston, Managing Director T-Systems
Dr. Robert Davies
Dr. Robert Davies is a visionary strategic advisor who supports business leaders and their organisations in the fields of foresight, strategy and change. He is a Senior Visiting Fellow at Cass Business School, London, with expertise in international relations, innovation and change management. Dr Davies teaches the MBA and MA programmes at Cass Business School and City University.
“A must-read for leaders looking to steer global organizations through the uncertainty of a world in transition.” Steven Spano, President, Generali UK “This book challenges conventional wisdom and provides a basis to develop new thinking ... Read this book and you’ll think differently about the world afterwards.” Prof Scott Moeller, Director, M&A Research Centre, Cass Business School
www.drrobertdavies.com Authors - please submit your book for review editor@redwoodapps.com
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The New Strategic Landscape: Innovative Perspectives on Strategy The New Strategic Landscape: Innovative Perspectives on Strategy is an exciting, new collection of perspectives on strategy which are informed by different areas of research, theory and practice beyond economics. Encompassing a diverse range of opinions and insights on strategy, this book breaks down the boundaries between theory and practice, it opens up a rich new territory of strategic ideas to explore, and shows the way to solutions that are more relevant to the world we face today. In the turbulent state of business today, entrepreneurs and technologies are disrupting traditional industries; incumbent market leaders are under threat. Business leaders need innovative ways of thinking about strategies, products and organisation. Julie Verity had produced a collection of alternative strategic ideas whose time has come. Simon Downson Collins, MEMBA and Director of Legal Affairs, HarperCollins Publishers
Julie Verity
JULIE VERITY (PhD) is a consultant, lecturer, writer and researcher in the field of strategy. She has split her working life between academia and the commercial world, bringing to each experience and knowledge from the other. Chosen to be the Shell International Fellow at Cranfield School of Management in 1990, her two year fellowship became a twenty year consulting relationship with the giant global oil group. Within Shell, she has worked with the Scenario team, with the Corporate Communications function, with Learning and with many of the Group’s national companies. Julie holds visiting faculty positions at Cranfield and Cass Business School and is an associate at Duke CE.
I have used several of the tools contained in this book, across large teams charged with strategic execution. The results have been astonishing. Try it, you will be surprised. Graham Smith, Cass EMBA and now Senior director, Technology Strategy and Information Architecture. Thinking about strategy as it is presented in this book resonates with my experience of the world I work in and the people, their behaviours and emotions, that I work with – neither are driven solely by economics. It will be compulsory reading. James Rutland, Cass EMBA and Finance Director, Skanska Infrastructure Development
Authors - please submit your book for review editor@redwoodapps.com
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Coming in January 2013 6 articles from some of the best MBA students January 2013
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Inside this issue: Entreneurship Meets Strategy | Social Media with Luxury Goods | Technology in Education
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