Page 35 - HBR's 10 Must Reads 20180 - The Definitive Management Ideas of the Year from Harvard Business Review

LAFLEY AND MARTIN

existing format. That segment consisted of value-conscious con-
sumers who nonetheless appreciated good design and a reasonably
pleasant shopping experience. To protect the then-dominant de-
partment store brand, the new venture was branded separately. Its
iconic bull’s-eye logo was meant to represent the notion of hitting
the target of convenience, price, and customer experience.
By the mid-1970s Target stores were outselling the company’s de-
partment stores. In 2000 Dayton Hudson changed its name to Target
to reflect the reality of its now-core business. In 2004 the company
sold its department store brands, completing an extraordinary retail
transformation.
Another fascinating transformation that leveraged the core
skills of a parent company is the relentless digitization pursued by
the newspaper publisher Schibsted, of Norway. Unlike many other
newspaper publishers, Schibsted saw the encroachment of digital
classified advertisements as an opportunity rather than a threat to
its business. Beginning in the late 1990s, its leaders aggressively
courted classified advertisers to list with its digital properties. This
became a crusade. As Sverre Munck observed when he was the EVP
for strategy and international editorial, “The Internet was made for
classifieds and classifieds were made for the Internet.” Long a tra-
ditional media company, Schibsted was able to leverage deep ties
with its advertisers with a model that permitted economies of scale
in editorial and communication activities across its media brands.
These were supplemented by a significant commitment to bringing
technological capabilities into the very core of the media business,
ending the tug-of-war between conventional editorial processes and
the logic of digital transformation.

A Balance of Stability and Dynamism

In 2012 I wrote an HBR piece titled “How the Growth Outliers Do It.”
That analysis, which looked at 10 years of net income data from 2000
to 2009, found that out of 2,347 of the publicly traded firms with a
market capitalization of more than $1 billion, only 10 had success-
fully grown net income by 5% or more in every one of those 10 years.

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