Cesare Mainardi ’86, CEO of Strategy& (formerly Booz & Company), is one of today’s foremost thinkers in business strategy. But when he started at Kellogg, he was a self-described “uber-engineer” who lacked the managerial insight to drive a business.
Mainardi plans to share his advice with graduating EMBA students this Saturday, June 13. In advance of his remarks, he shares his career journey thus far.
What was your biggest takeaway from Kellogg?
When I arrived at Kellogg, I was an uber-engineer with degrees in industrial and manufacturing engineering from Northwestern. I was extraordinarily analytical and used to working as a “team of one” to solve problems in a very linear and logical way.
Kellogg taught me how to collaborate and showed me the exponential power of teaming compared to my previous way of working. It also helped me think strategically and showed me how to unravel big, messy, complex business problems that don’t follow straight lines or submit to the rules of logic.
I arrived at Kellogg as an engineer. I left as a strategist who knew how to harness the power of teams to architect massive organizational transformations and drive growth. Inspiring growth became my passion and my career.
Thinking back on your own graduation, what advice would you give yourself — or any other Kellogg graduate?
Follow three simple rules: Differentiate, commit to that unique identity, and translate the strategic into the everyday. It sounds simple, but it’s remarkably hard to turn these platitudes into action. It takes absolute focus and courage of conviction. But if you do these three simple-but-difficult things well, you will achieve bold and amazing results.
- What do you do better than anyone else? What makes you different? That’s the true basis of your competitive advantage — the one-in-a-million value proposition that is uniquely you. Identifying and articulating this differentiation is aspirational, it is powerful, and it can be a defining moment in your career.
- Once you’ve achieved this clarity, own it. Commit to your unique identity and use it as a lens through which to focus all your strategic career decisions. Find a job that allows you to do what you do best and ensures that you continue to refine and evolve your unique skill set.
- Translate the strategic into the everyday.This is perhaps the single hardest thing to achieve. You’ve crafted a strong career strategy and you know exactly the dream job you want to land. But how do you get from here to there? How do you do a hundred or a thousand things that all add up to the right outcome? Break your career strategy into pieces, make it executable, and make it part of what you do, day in and day out. Put yourself on a mission and focus with laser-like intensity on ensuring that everything you do aligns with, feeds into, strengthens, and grows your differentiated skill set and value proposition.
What is the biggest challenge facing CEOs today?
The greatest challenge is leading through uncertainty and navigating change — including sweeping technological disruptions, massive regulatory and policy upheavals, and unpredictable markets. It’s daunting to lead in a fast-shifting, ever-changing business environment. You hear a lot of buzzwords like agile strategy and dynamic resilience. Unfortunately, this is usually code for “Throw out your strategy and chase whatever you think might work.”
Making such desperate moves is definitely not the answer. Managing for the short term never breeds greatness. In fact, it often guarantees the opposite. A fairly shocking statistic: we’ve done research that shows that 80 percent of corporate value destruction comes from bad strategy decisions. That means that getting strategy right is the single most valuable decision that any executive can make. And the most expensive and disastrous, if you get it wrong.
The key is this: It’s not about moving rapidly. It’s about staying true to who you are and resisting the urge to chase others. The most successful companies know who they are and understand the job they are uniquely qualified to do in the market. In turbulent times, they succeed by doubling down on the key things, the unique capabilities that make them truly great — not by chasing growth around every corner.
It takes extraordinary discipline to stay true to your strategy. But if you figure out your winning capabilities and play to them, if you operate from your core strengths, you will weather uncertainty and navigate change much more adeptly.
Profitable, sustainable growth: It’s the goal of every organization. How do you think businesses should approach growth?
Let’s start with what not to do. Unfortunately, many companies pursue growth by trying to chase the market, wherever it may take them. They start with the question: “Where can I grow?” What that really means is “Where do the trends point to large, accessible growth opportunities with relatively low risk?” If you’re pursuing growth this way, it will likely lead your company to go after the same market opportunities as all your competitors, with the idea that if you can get there first, you can win. This tends to be a recipe for disaster. Everyone can spot the same trends. Even if you gain some advantage, it will be very hard to defend. You can easily get trapped on a growth treadmill — pursuing multiple market opportunities, feeling increasing pressure to show results, but always falling further behind. That’s bad, unprofitable growth. And no one wants that.
The flip side is good growth. There’s no running after opportunities, no searching the market for answers. To jump-start this kind of growth, you start with different questions: “What is my company uniquely qualified to do? And how can I match my distinctive capabilities to market opportunities that create demand?” Identify the things you do better than anyone else and rally your entire company around enhancing, refining, and using those key capabilities. As a proprietary growth engine, this capabilities system allows you to carve out a formidable position in your market, create steep barriers to entry for others, and open up robust growth avenues that others can’t match.
Think about Apple’s ability to spot a burgeoning consumer need; develop the right technology for it; design the interface to be intuitive, elegant, and easy to use; and market it in a compelling way. Think about Walmart’s sharp-penciled management at every link in the value chain, expertise in assortment, incredibly lean supply chain, and unrivaled point-of-sale analytics — all of which come together to make the company a leader in low-cost retail.
Companies like these that successfully apply capabilities-driven strategy are three times as likely to report above-average growth. That’s a tremendous premium. The bottom line: Every day as an executive you will make dozens of strategic choices about where to invest, where to cut, and where to focus scarce resources. Strategy is really a series of choices. If you want to improve your hit rate on making winning choices, base every decision on what’s essential to fueling your company’s unique capabilities system. This will create a powerful engine of growth — one that can’t easily be copied or bought off the shelf by your competitors. That’s the basis of building enduring competitive advantage that fosters growth and gets you off the “chase-the-market” treadmill for good.