No measures without excess

The new paths of enterprise’s performance must fall within the scope of duration, systems and globality. They characterize the impact of environmental changes in terms of value well beyond traditional metric. To illustrate this, let us take, for example, the emergence of digitalization in order to transform the business and favor innovation services (Big Data, artificial intelligence (AI), Internet of Things (IoT), etc.).

The search for value is becoming with more and more acuity the main objective of enterprises that are anxious to create different revenue models, “in rupture” or, in other words, differing. More importantly, this is at the time of economy based on sharing or a platform that impacts all sectors of activity by questioning fundamentals and usual models.

However, we must not forget operational excellence in the production of goods and services, which will be strongly impacted by digital development and robotization. It is up to the enterprise to ensure that these technological opportunities are taken advantage of in order to positively contribute to this excellence.

The approach to measure performance does not go without consequence. Naturally, activity must be measured as objectively as possible, reasonably and dynamically. However, the metamorphosis that we are experiencing raises several fundamental issues. Here are some of them. Are the methods of return on investment (ROI) calculation still pertinent? Are they suitable for the new economic context that we are facing today? Are the ratios of classical management, activity and profitability still the right ones? Will non-financial information that allows the measurement of financial engagements in terms of corporate social responsibility (CSR) become pre-eminent? Must the valorization of assets that are deemed intangible, in particular intellectual property, be carried out in a systematic manner with potential for future value? Can an enterprise strive for “sustainability” without ethical and responsible behavior? Can it develop sustainably without relying on solid foundations, those of skill, staff engagement and attractiveness to new talents?

Let us take a look at the largest stock valuations, those of digital “pure-players”, in order to see the growing gap between capital value and profitability. To guarantee its continuity, a “sustainable” enterprise must redefine its position regarding ecosystems, alchemy between customers, shareholders, partners, service providers and suppliers, institutions and staff. A new strategy will arise, associating the vision and the reality of business, above all by not prohibiting anything at first glance. Of course, it will be necessary to make enterprise culture evolve in order to act quickly and not get left behind.

Yes, beyond “good” measure that involves rethinking organizations and their modes of operation in-depth, a little bit of excess is needed. This ounce of foolishness can push one to innovate, step out of one’s comfort zone and anticipate changes. This will facilitate governance and leadership efficiency, guarantee that the enterprise is closely monitored, and accelerate its rise and maturity. No measures without excess.

Geoffroy ROUX DE BÉZIEUX
President, MEDEF (France’s largest employers’ association)