Top Performers – 10 Ways to Innovate

The table below shows Business Week’s latest top 50 corporate performers for 2007. The rankings are based on profitability, sales growth, and market value.

What we learn from it is this: Every one of the top 10 performers has found a way to innovate, especially in its business model and business design.  

Here is what Business Week said about Coach, the #1, performer: 

The handbag maker moved quickly when it understood that its aspirational customers might suddenly hesitate at spending $900 for one of its Legacy handbags. Coach quickly rolled out more affordable lines of bags for as little as $160. 

And about #2, Gilead Sciences:

The Northern California biotech firm sensed an opportunity for any company that could develop drugs that were simpler and cheaper than standard HIV treatments, which required patients to take dozens of different pills throughout the day. Gilead’s researchers simplify those cumbersome treatments by combining myriad compounds into a single pill, Atripla, that costs just $1,300 a month and is taken at bedtime.

Going on down the list, we learn what strategy guru Gary Hamel has been saying for years: Truly powerful innovation changes the rules of the game in an industry, by redefining the way companies do business. When they succeed, profitability and sales growth soar.

2008 Rank	2007 Rank	Company Name	Overall Grade	Profitability %	Profitability Grade	Sales Growth Rate %	Sales Growth Grade	Market Value* ($bil)	12-mo. Sales ($bil)	12-mo. Net Income ($bil)	One-yr. Total Return	Three-yr. Total Return	Sector
1	2	COACH	A	60.5	A	24.1	A	10.0	2.9	0.7	-41.8	-4.0	Consumer Discretionary
2	3	GILEAD SCIENCES	A	45.0	A	47.5	A	45.2	4.2	1.6	40.9	180.5	Health Care
3	26	ALLEGHENY TECHNOLOGIES	A	43.2	A	27.2	A	7.5	5.5	0.7	-25.7	224.3	Materials
4	7	VERIZON COMMUNICATIONS	A	13.8	A	11.1	A-	99.7	93.5	5.5	-0.1	14.2	Telecommunication Services
5	5	QUESTAR	A	24.3	A	11.9	A-	9.9	2.7	0.5	37.8	95.4	Utilities
6	34	APPLE	A	31.6	A	38.3	A	112.4	26.5	4.1	44.7	217.7	Information Technology
7	8	COLGATE-PALMOLIVE	A	58.0	A	9.0	B-	39.3	13.8	1.7	19.5	56.9	Consumer Staples
8	-	BJ SERVICES	A	37.3	A	22.5	C	7.4	4.9	0.7	-6.2	4.7	Energy
9	-	ABERCROMBIE & FITCH	A	56.4	A	22.5	A	6.5	3.7	0.5	2.5	34.5	Consumer Discretionary
10	-	MEMC ELECTRONIC MATERIALS	A	46.3	A	24.7	B+	19.1	1.9	0.8	50.8	485.8	Information Technology

Market Value* ($bil)	12-mo. Sales ($bil)	12-mo. Net Income ($bil)	One-yr. Total Return	Three-yr. Total Return	Sector
10.0	2.9	0.7	-41.8	-4.0	Consumer Discretionary
45.2	4.2	1.6	40.9	180.5	Health Care
7.5	5.5	0.7	-25.7	224.3	Materials
99.7	93.5	5.5	-0.1	14.2	Telecommunication Services
9.9	2.7	0.5	37.8	95.4	Utilities
112.4	26.5	4.1	44.7	217.7	Information Technology
39.3	13.8	1.7	19.5	56.9	Consumer Staples
7.4	4.9	0.7	-6.2	4.7	Energy
6.5	3.7	0.5	2.5	34.5	Consumer Discretionary
19.1	1.9	0.8	50.8	485.8	Information Technology

The Innovative Pregnancy

Does life imitate art? 

Remember the awful film starring Arnold Schwarzenegger, in which the muscular Arnold got pregnant and bore a child? (“Junior”, 1994).

Well, guess what. A former Hollywood beauty queen named Tracy underwent a sex-change operation, became a man, and then married Nancy, divorcee with two children from her previous marriage. The couple wanted to have a child of their own, but Nancy had problems getting pregnant.

Now, in the sex-change operation, “Tracy” had chosen to retaine his/her uterus and reproductive organs. So he became the one to bear their child. The birth will occur in a few months. His pregnancy has of course attracted world-wide attention, on BBC and with the couple appearing, inevitably, on the Oprah Winfrey Show.

“Tracy” says that child-bearing is not a male or female thing, but simply a human desire – to bring life into the world.

My question is: will baby Nova call Mom/Dad, Mom? or Dad? Will he or she call Mom, Mom? How about Mom one and Mom two? No, too long. 

Innovation is not without its problems.