In early 1990, the Chairman of Rabobank Nederland, one of the largest Dutch banks which traced its origins back to the late 19th century when it was established as a cooperative to relieve the hardship of Dutch farmers, entered into discussions with the President of the Robeco Group, the country’s leading independent investment management company, to explore the possibility for a potential alliance. While Rabobank, with its extensive network of fairly autonomous local banks, held a dominant position in the savings market and in financing small and medium-sized business, it had foundered in the investment business, currently holding only about 2.5% of this market. One idea put forth in a December 1989 discussion paper was to team up with an expert in the industry who would promote Rabobank’s investment funds.
Rabobank and Robeco Group: Background on Rabobank
Summary
In early 1990, the Chairman of Rabobank Nederland, one of the largest Dutch banks which traced its origins back to the late 19th century when it wa...
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IMD-3-0551
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©1995
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Rabobank and Robeco Group: Background on the Robeco Group
Summary
In early 1990, the President of the Robeco Group entered into discussion with the Chairman of Rabobank Nederland, one of the largest Dutch banks, to explore the possibility for a potential alliance. Historically, Robeco had been a conservative marketer, relying on banks and stockbrokers to sell its products. However, when the Dutch banks began offering their own funds in the early 1970s and sales of its flagship fund slumped, Robeco was forced to become more of a hustler and an innovator. Following the arrival of a new president in 1987, the company was again revitalized, adding both marketing and information systems capabilities to become one of the leading independent investment management companies in the Netherlands. Deriving 70% of its funding from Dutch investors, Robeco currently dominated the domestic investment market. However, the performance of several Robeco funds had been stagnating for some time, and top management was feeling increasing urgency to broaden the company's cashflow and to find an "impulse" to get things going again.
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IMD-3-0552
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©1995
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Rabobank and Robeco Group: Giving life to the joint venture
Summary
In the summer of 1990, a committee was formed to work on developing an organizational structure for the joint venture, IRIS, that would operationalize the co-operation between Rabobank and the Robeco Group. IRIS was to be located in Rotterdam in existing Robeco facilities beginning January 1, 1991, housing up to 150 people. Two co-directors, who had been part of the original task forces, were designated to represent the interests of each mother organization. Only 87 of the 120 Rabobank people, who were qualified to enter the joint venture, accepted the move. One of the early challenges was to bring the cultures of the two parent organizations together and to build a new IRIS culture. By the end of 1991, the joint venture appeared to be running smoothly. Robeco was experiencing an increase in revenues that could be directly attributed to IRIS, and the local Rabobanks also seemed relatively happy with the prospect of having a new jointly-developed product available in the near future. However, some areas in the joint venture still needed work. For instance, it was becoming increasingly clear that the necessary linkages between IRIS and Robeco marketing were not always being made.
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IMD-3-0555
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©1995
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Rabobank and Robeco Group: The negotiation
Summary
Following discussions between the Chairman of Rabobank and the President of the Robeco Group, two task forces were set up to do further background work and conduct preliminary talks during the spring of 1990. Now, in early May, each side was about to enter the final stage of negotiations regarding a potential alliance.
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IMD-3-0553
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©1995
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Rabobank and Robeco Group: The outcome of the negotiation
Summary
In May 1990, Rabobank and the Robeco Group announced their intention to enter into a lasting strategic alliance. With the guiding principle that this co-operation would focus on offering investment products and services as well as investment research and product development, a Steering Committee, consisting of the original members of both task forces plus two additional representatives from each of the mother organizations, made the decision to form a joint venture that would officially start on January 1, 1991. The expectation was that within one year, the joint venture would be standing on its own and within two years, it would be covering its own costs.
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IMD-3-0554
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©1995
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Here’s what we predicted for 2024… how did we do?
Summary
Did our predictions for 2024 come true, a turbulent election year, bitcoin and CBDC, COP29 and electric cars, China, EU integration and Euro football
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The strategic imperative
Summary
In a world where change is the only constant, the strategic imperative for sustainability is not just a theoretical construct – it’s a call to action. This section of the book delves into the core strategies that will enable businesses to thrive i...
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Framing the conversation
Summary
In late 2020, as the world began to emerge from the worst
of the COVID-19 pandemic, Wärtsilä, a Finnish corporation
specializing in power systems, made a bold decision.
Despite being a well-established company with a strong
track record in...
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NTT at a crossroads (A): Quest for growth
Summary
NTT Corporation, Japan’s information and communication technologies (ICT) leader since 1953, was the first to commercialize internet usage on mobile phones in the 1990s, which resulted in NTT achieving much success in Japan. However, by the end of the 2000s, Japan faced challenges with an aging population and a stagnant economy. Recognizing disruption in the ICT sector, CEO Satoshi Miura understood the need for the dominant players in the ICT industry to integrate emerging business domains beyond their existing frameworks. To secure leading global positions in ICT and the new paradigm of cloud computing, Miura needed to make strategic choices to revive growth. Case A provides information on NTT, its rivals, the global market and cloud computing disruptions. The case ends with NTT’s CEO exploring strategic growth options to prepare NTT for the future.
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IMD-7-2351
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©2024
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Nippon Telegraph and Telephone
Industry
Services, Telecommunications;Information Technology
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NTT at a crossroads (B): Mapping growth options
Summary
Building on NTT (A), the case starts with NTT’s CEO having narrowed down strategic growth options with the board to prepare NTT for the future. Past international investments in AT&T Wireless and KPN to tap into foreign markets had resulted in billion $ write offs and stopped international acquisitions. However, after reviewing the disruptive changes facing the ICT industry and considering the shareholders’ views, CEO Miura committed to internationalization. The B case details NTT’s growth strategy focused on internationalization, while considering the need for new capabilities and technologies. It provides more insights into NTT, its opportunities and the Japanese experience with M&As and ends with Miura’s determination to quickly grow through international expansion to prepare NTT for the future.
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IMD-7-2352
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©2024
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Nippon Telegraph and Telephone
Industry
Services, Telecommunications;Information Technology
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English
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Overcoming adversity through innovation – Daikin at 100 (A): Leadership lessons
Summary
This case study examines the remarkable evolution of Daikin Industries, a company that demonstrated resilience and innovation over nearly a century. Founded in 1924 by Akira Yamada in Osaka, Japan, Daikin originally focused on manufacturing aircraft components. However, the company pivoted towards refrigeration technology in response to emerging market demands, notably during Japan’s post-World War II economic boom. By leveraging R&D in fluorocarbons and innovative cooling technologies, Daikin established itself as a leader in the air conditioning sector. The case highlights key leadership eras, notably the transformative periods under Noriyuki Inoue. Under Inoue’s stewardship, the company emphasized execution capabilities, prioritizing operational excellence alongside technological advancement. His leadership drove Daikin’s globalization strategy, enabling the company to become the second-largest fluorocarbon producer globally and the foremost player in the air conditioning market. As Daikin approaches its 100th anniversary, it faces contemporary challenges such as climate change and increasing consumer demands for energy-efficient products. The company’s commitment to innovation remains pivotal as it seeks to balance profitability with environmental responsibility. This case prompts discussion on Daikin’s strategic responses to evolving market conditions and the importance of leadership in sustaining growth.
Reference
IMD-7-2618
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©2024
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Organization
Daikin Industries
Industry
Consumer Goods, Home Appliances
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English
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Overcoming adversity through innovation – Daikin at 100 (B): Sustainability lessons
Summary
This case study examines the remarkable evolution of Daikin Industries, a company that demonstrated resilience and innovation over nearly a century. Founded in 1924 by Akira Yamada in Osaka, Japan, Daikin originally focused on manufacturing aircraft components. However, the company pivoted towards refrigeration technology in response to emerging market demands, notably during Japan’s post-World War II economic boom. By leveraging R&D in fluorocarbons and innovative cooling technologies, Daikin established itself as a leader in the air conditioning sector. The case highlights key leadership eras, notably the transformative periods under Noriyuki Inoue. Under Inoue’s stewardship, the company emphasized execution capabilities, prioritizing operational excellence alongside technological advancement. His leadership drove Daikin’s globalization strategy, enabling the company to become the second-largest fluorocarbon producer globally and the foremost player in the air conditioning market. As Daikin approaches its 100th anniversary, it faces contemporary challenges such as climate change and increasing consumer demands for energy-efficient products. The company’s commitment to innovation remains pivotal as it seeks to balance profitability with environmental responsibility. This case prompts discussion on Daikin’s strategic responses to evolving market conditions and the importance of leadership in sustaining growth.
Reference
IMD-7-2619
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©2024
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Organization
Daikin Industries
Industry
Consumer Goods, Home Appliances
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English
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Overcoming adversity through innovation – Daikin at 100 (C): China market lessons
Summary
Daikin’s success in the Chinese air conditioning market serves as a compelling case study in strategic adaptation and collaboration. Following its entry into the market in the 1990s, Daikin faced formidable competition from well-established domestic brands like Gree and Midea. Despite the initial challenges of breaking through in a fragmented and competitive landscape, Daikin’s innovative inverter technology became a distinguishing feature of its product offerings. The watershed moment in Daikin’s trajectory occurred in 2008 when it formed a strategic partnership with Gree, China’s largest air conditioner manufacturer. This collaboration enabled Daikin to tap into Gree’s expansive distribution network and manufacturing expertise, significantly enhancing its own market reach. The partnership proved mutually beneficial; Gree capitalized on Daikin’s advanced inverter technology while Daikin secured a foothold in a market driven by increasing consumer demand for energy-efficient solutions. By 2012, inverter air conditioners claimed over 60% of the Chinese market share, a figure that surged to over 90% by 2024, illustrating the success of their joint efforts. Furthermore, Daikin’s commitment to sustainability was manifested in its pioneering use of HFC-32 refrigerant, known for its low global warming potential. By openly licensing HFC-32 patents globally, Daikin not only positioned itself as an environmental leader but also fostered industry-wide innovation. This case highlights the critical importance of strategic partnerships and innovation in overcoming competitive challenges and underscores Daikin’s role as a transformative force in the global air conditioning market.
Reference
IMD-7-2620
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©2024
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Organization
Daikin Industries
Industry
Consumer Goods, Home Appliances
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Busting the myth of flashy innovation
Summary
Learn why flashy innovation often fails and how a strategic, fact-based approach can drive real innovation success in corporate environments. Insights from industry experts.
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Busting the myth of flashy innovation
Summary
Learn why flashy innovation often fails and how a strategic, fact-based approach can drive real innovation success in corporate environments. Insights from industry experts.
In this final article in a series of three articles, Joep De Caluwé (EMB...
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