“The fabled Dow Jones average is based on the performance of 30 bellwether stocks, taken to represent the economy of the US as a whole. In May 1991, USX (U.S. Steel until it decided to “soften” its image), on the list since day one, dropped out. So did Primerica (the softened name for American Can), also on the list since start. Guess what firms replaced those two? Disney and J.P. Morgan. Get the drift?” – Liberation Economy.

So what is the drift? Disney and J.P. Morgan are into entertainment and financial services that play human imagination and information. Considerably, different from the steel and cans which are products of those mentioned “dropped outs” from the prestigious Dow Jones index. Truly, competition has taken its shape on another form. It has taken a fluid form. It has become “soft”. Information.

Every business gets into the bandwagon of movements that anticipates the continuously evolving market trends. Quick responses to the consumers’ needs are always the key indicators among the leading businesses worldwide.

Structured corporation has become a thing of the past. The essence of business strategy is no longer into the company’s products and markets, but the dynamics of its behavior and how it reacts to the ever changing market needs.

Let me take you to the wonders of the “rule of five”. According to my favorite economist and author, a multi-billion dollar corporation should only maintain no more than five central staffers per billion dollars in revenue booked. Yes, it is crazy! But that’s how the Zurich-based ABB Asea Brown Boveri which is a large manufacturing firm has done by cutting 95% of its corporate staffing and now maintains, only 150-person contingent. It is the only way to survive such a fickle and ephemeral market by becoming such a fickle and decentralized operated corporation.

The trick here is you have to manage your operations using the power of subordinate units with distinct abilities that can spin out new units to operate the business.

Want more expounding? To be continued…