Ernesto González, CEO of Fidamc, a centre for R&D&I and training in composite materials, recently took part in some interesting conferences organised by Industry Talks, where he addressed one of the most complex and strategic issues for any large company: how to replace a star product.
Under the provocative title ‘How to kill your Cash Cow’, Gonzalez exposed the difficulties that companies face when they have to replace a key product, those that define the identity of a brand and represent its biggest market share. Using examples such as Sony's PlayStation, McDonald's Big Mac or the Airbus A320, Ernesto highlighted how these ‘cash cows’, as defined by the BCG matrix, are both the engine of the company and a barrier to change.
The talk focused on the need for anticipation: replacing an established product requires not only innovation, but also rigorous planning from different dimensions. To structure this process, González used the Balanced Scorecard approach, analysing the transition from four essential perspectives: market, finance, internal processes and people.
Balanced Scorecard approach: market, finance, internal processes and people
From a market perspective, he stressed the importance of launching products that respond not only to current but also to future needs, and warned about the time it takes for the new product to match the penetration of the previous one. In the aeronautics sector, for example, this process can take more than a decade.
On the financialside, Ernesto stressed the need to prepare economic muscle years before making key decisions, as well as to foresee the negative impact that the announcement of a new product may have on orders for the current one.
In terms of internal processes, organisational restructuring, coordination with the supply chain and the decision whether or not to overlap products are critical variables that directly influence the success of change.
Last but not least, he discussed the role of people within the organisation, emphasising the need to strike a balance between those who support the current product and those who work on the development of the new one.
With a clear, didactic approach and loaded with real examples, Ernesto González managed to offer a precise x-ray of the strategic dilemmas faced by large corporations on their way to sustainable innovation.
If you want to watch Ernesto's full conference, we encourage you to visit the Industry Talks website, where the video with his complete intervention is already available: https://industrytalks.es/ernesto-gonzalez-fidamc-tiene-que-haber-mucha-anticipacion-para-sustituir-un-producto-estrella/
English 
Spanish