Building Sustainability Into Their Core Strategies

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“S&P 500 companies that build sustainability into their core strategies are outperforming those that fail to show leadership.” (Confino, 2014).
In order to be successful, a firm doesn’t necessarily need a recipe, there’s in fact no given guideline for a business to make profits, succeed, and enter Wall Street one day.
Even without an imposed and precise guideline on how to succeed, a firm should be aware of different vectors that will help to become successful, more or less on the long run.
When we look at a firm, it is interesting to look at their “sustainable profitability”, which consists of their ability to evolve within a certain environment, taking into account different factors such as social matters, economical issues, and
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All these vectors of the model show how companies work as one with their networks in order to find a balance in their supply chain management strategy, and can be completed by one of Porter’s other famous model: cost leadership, differentiation and focus.
The power of a firm relies on these former elements where new entries, competition, buyers, suppliers, and substitutes are the major actors of the network the firms positions itself in.
In order to illustrate this model within our analysis, we can take a look at LVMH’s strategy.
LVMH is a group of premium brands all around the world, including Louis Vuitton, Fendi, Givenchy, make up and perfume giant Sephora but also Veuve Cliquot champagne to only cite a few, who generated thirty-five billion euros last year, which could lead us to think they are a successful firm. Their substitutes are rare and less qualitative, their suppliers have a limited negotiation opportunity because of LVMH’s choice to operate in mass distribution scheme, which restricts discussions. Within this company, LVMH has a great negotiation power, because their assertion is anchored within the market they operate in. (321 words)

In order to acquire this attractive network position, firms have to be conscious about the networks they are building and evolving in.
Many vectors can lead the attractiveness of these networks to vary, and one of
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