I was surprised by Mercadona’s focus on value engineering and continuous improvement in their line of self-branded products, 500 million euros per year in cost reductions is impressive. Many of the changes they made seem really minor but at such a large scale they add up to make to a serious impact. It was also interesting to see that they do not rely on advertising and marketing. These two aspects of their operations play right into their value proposition of being the preferred low cost provider and their recent growth despite the economic crisis is convincing proof of their model.
Is their incentive system typical of other firms in Spain? They seem to really live by their model of placing employees right after the customer by giving out bonuses of up to two months salary to employees at the ground floor of the organization.
Great post Andrew, it’s impressive how agile Netflix has been. The speed at which they are able to execute these strategy shifts seems to have really helped separate them from their competition. Comparing their trajectory with Amazon Prime or Hulu really puts it into perspective.
Barr – very exciting stuff. I think your spot on regarding their business/operating models, focus on their strengths and bring in experts/partners to make up for their weaknesses. In a high volume industry where safety is paramount they can’t afford to make any mistakes in their ops, so I feel it’s a good approach. It’s interesting to this trend of smaller tech-based companies partnering up with OEMs/Tier 1s to help accelerate innovation in the automotive space, can’t wait to see how it all plays out.