Luis de los Santos
Thanks for your comment Rob! Exactly, as you correctly explain, Mercadona’s model is impressive in many ways.
To your question on their incentive systems, it’s not typical of Spanish companies; it’s actually rare, and even more so because the bonus schemes apply to every employee at every level, even ‘at the ground floor’. And perhaps even more impressive is that Mercadona hires its employees on permanent contracts. To put you in context, despite the fact that Spain enjoys the benefits of being a welfare state, the labor system has been suffering from endemic problems for decades. The unemployment rate is currently above 20% and over 90% of the new contracts signed in the first half of 2015 were temporary contracts. This is to give you a sense of how unique and superior is Mercadona’s approach, consistent with its philosophy of having a committed, satisfied workforce to best serve its clients.
Great article! As a Netflix user, I found your post very interesting. As business school students, I think we have a lot to learn from the way Netflix has been able to successfully, repeatedly reinvent its own business model.
I also think Netflix has been able to leverage the boom of smartphones, tablets, and smart TVs better than anyone else in the industry. Now we have Netflix embedded in our TVs and our phones, easily accessible at all times in high definition screens.
As you point out in your post, Netflix has been smart at offering high levels of artistic control and full-season orders to its content creators. If I were a content creator, I’d like to have my show on Netflix. The vertical integration has been key.
I’m curious about Netflix evolution in the coming years, as more competitors start to offer high-quality content on our smart TVs. Should Netflix keep moving so nimbly and continue being able to self-generate smart content, I’m sure the company will remain competitive.
Hi Brandon, thanks for this article! I didn’t know SpaceX, but I’ve always been very interested in space and the universe, so I really enjoyed this post.
It’s very interesting the “first principles logic” that SpaceX is applying in the aerospace industry. I think it has a lot in common with the design thinking processes that we’ve learned in class. This also demonstrates that it’s possible to be disruptive and to create new ways of doing things in virtually any industry by re-thinking from scratch and not just relying on the given, general assumptions. Thinking out of the box.
I also liked to learn that SpaceX is using 3D printing, since I believe 3D printing is going to change the world in the next decades. It’s great to know that there are companies already applying this technology in such a sophisticated sector as the aerospace industry.
Thanks for this great post Perry! As a loyal client of Ikea, I enjoyed this article a lot.
I agree that one of the great aspects of the Ikea model is that it gives me the choice to “do-it-myself” and save on the assembly costs instead of buying the assembled furniture paying a higher price.
The in-store physical layout, as you mention in the article, is another of Ikea’s brilliant ideas to drive sales. Many times I’ve been to Ikea with the idea of buying two or three specific things and I’ve ended up leaving the store with a big bag full of Ikea products (those impulse buys…).
Another aspect that I value is that most of Ikea’s products and packaging are environmentally friendly, something that Ikea has been doing for decades, long before its competitors.
For all the reasons that you explain in the article, I also agree that Ikea is a clear winner. And even when its competitors have attempted to replicate the model, none of them has still managed to reach Ikea’s standards.
Thank you Laurent! You pointed out a very interesting topic.
Mercadona has still room to expand in Spain. The company opened 61 new stores in 2013 and 60 new stores in 2014, and has plans to launch more openings in 2015-2017.
For instance, last year the company opened its first supermarket in the Basque region in the North of Spain. And this region is one of the wealthiest and most densely populated in the country. So I think this proves Mercadona has still potential to keep expanding within the country.
In any case, for a long time there have been rumors about Mercadona’s plans for international expansion (in Italy, Portugal, and France), but in 2013 the company decided to ‘suspend’ them and stay focused on the Spanish market to fight the economic crisis.
As I explain in my post, Mercadona’s model is based on a very close relationship with clients and suppliers to offer high-quality, fresh products at very competitive prices. Replicating this model in other competitive markets could be a real challenge.