Some of you have seen the readiness ranking that my research team at IMD released last week. But I didn’t fully grasp its implications until going for an interview with CNBC yesterday.
I was in New York City, and the show was scheduled for morning, London time. So, at 2:30am, the station called in and minutes before I went on air, the two anchors were speaking about Nike’s latest earnings. Nike evidently exceeded investors’ expectations in profit growth; its share price spiked. This is why my interview started off with an analysis on the apparel industry.
Here is the thing, Nike has been consistently ranked among the top in our Future Readiness Indicator for two years now. We look at many aspects of a company. We investigate their financial performance. We check out their ESG (environment, social and governance) records. We ask about their innovation results. We examine expectations from their investors. We roll up everything into a composite score and then we rank companies against one another. A future-ready company is one that can both deliver today and win tomorrow.
So, what are the implications? If you are future-ready, you can always pivot faster than others. Because you are ahead of others, you have already scaled new capabilities. So Nike, during the last few years, was able to pivot toward e-commerce at a greater extent. During the pandemic lockdown, it was able to capitalize fully on people shopping at home. Why? It’s not just the great app that Nike has; it also possessed an equally world-class digital supply chain. It also already knew how to work closely with Instagram and TikTok influencers. It even dabbled in the Metaverse, selling NFTs big time. Share prices took off alongside Lululemon—another top-ranking brand.
Now times are getting tough. Everyone’s share prices dropped. But again, Nike and Lululemon suffered less than others.
The upshot is this: the year 2022 looks like a prelude on what’s to come. It’s never too late to be prepared. And preparedness is the main thing. Being future-ready is a source of resilience in 2023.
🎄 Happy Holidays! ❄