How to put your money where your strategy is?
Most companies allocate the same resources to the same business units year after year. That makes it difficult to realize strategic goals and undermines performance. Here's how to overcome inertia.
Picture two global companies, each operating a range of different businesses. Company A allocates capital, talent, and research dollars consistently every year, making small changes but always following the same broad investment pattern. Company B continually evaluates the performance of business units, acquires and divests assets, and adjusts resource allocations based on each division's relative market opportunities. Over time, which company will be worth more?
MARCH 2012 • Stephen Hall, Dan Lovallo, and Reinier Musters
Source: Strategy Practice
McKinsey Quarterly is the business journal of McKinsey & Company.
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