Michael Covel's Trend Following Ep. 1099: The Invincible Company and Dark Data with Michael Covel on Trend Following Radio
Aug 5, 2022
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Use Cash To Build Resilience Not Just Buybacks
- Build resilience by investing cash into exploration and business-model diversification rather than pure buybacks and short-term efficiency.
- Osterwalder cites Ping An and Amazon as examples that used cash to transform into tech and platform businesses.
Business Model Identity Beats Industry Identity
- Defining a firm by industry makes it fragile; defining it by business model and ecosystem creates durable advantages.
- Boeing focused narrowly on an industry and milked efficiency, increasing corporate mortality when shocks arrive.
Leaders Must Prioritize Innovation Time
- Leaders must spend meaningful, regular time on innovation—Osterwalder suggests up to half their weekly time—to give transformation power and momentum.
- Without bold structural power shifts, innovation remains 'theatre' not strategic change.