Summary: The Neglected Firm

Review and Analysis of Vasconcellos E. Sa's Book

BusinessNews Publishing

• Publisher: Must Read Summaries
• Year: 2016
• eBook ISBN: 9782511021781
• Topic: Business
• Subtopic: Business Strategy
• Index: Business

The must-read summary of Jorge Vasconcellos E. Sa's book: `The Neglected Firm: Every Manager Must Manage Two Firms: The Present One and the Future One`.

This complete summary of the ideas from Jorge Vasconcellos E. Sa's book `The Neglected Firm` shows that one of the central challenges of management is the need to strike the optimum balance between what a business currently does and what it will need to do to succeed in the future. In his book, the author describes the `eternal dilemma of management` and how this dilemma needs to be solved through the management of present and future firms before the company can achieve good performance. This summary explains exactly how you can do this and will help you to ensure the future success of your business.

Added-value of this summary:
• Save time
• Understand key concepts
• Expand your knowledge

To learn more, read `The Neglected Firm` and discover how you can follow this new strategic framework for long-lasting performance.

Summary of The Neglected Firm (Jorge Vasconcellos e Sa)

1. The Concept of the Future Firm

If the existing business of a commercial enterprise is designated as the “present firm”, the strategic planning department is like a “future firm” – it focuses on what the business will need to do to succeed in the future. Often, strategic planning gets pushed into the background and ignored because of the day-to-day pressures and demands. That presents a great opportunity for managers. The company that does strategic planning well will have taken a huge step towards securing a sustainable competitive advantage in the future.

To take the concept of two firms existing in parallel simultaneously a little further, the present firm generally has at least seven functional departments or business units while the future firm has just the one department:

The present firm focuses on doing the right things right by:

1. Developing products and services customers want.
2. Fulfilling the needs of customers to deliver value.
3. Catering to customers in the right target markets.
4. Operating in the planned geographic regions.

All of the functional departments in the present firm get so busy running their day-to-day operations as efficiently as possible that little time or effort can ever be devoted to what will need to be done differently in the future. This is why the future firm with a strategic planning department is required. In essence, the future firm helps top managers think of new ways to be both effective and efficient in the future.

As such, the future firm’s focus is on planning rather than executing. Specifically, the future firm will have six key functions:

1. To participate in planning meetings – where line managers and senior managers come together to evaluate their present strategies.
2. To organize the planning meetings – by coordinating with senior management who should attend, how frequently the meetings should be scheduled, their location and so forth.
3. To supply the planning meetings with the required information – in the forms of an agenda, study documents, and whatever else is needed to make good decisions.
4. To manage the information gathering systems – so that the information needed for a decision to be reached is centralized, structured and retrievable.
5. To integrate all individual department plans – into one cohesive corporate plan which is systematic, succinct and easy to be consulted.
6. To study alternatives – which are under consideration for improving the operating efficiency of the departments within the present firm with a view towards dissipating bottlenecks or enhancing the effectiveness of each department.

Overall, the future firm is responsible for making certain the business changes to respond to the ongoing changes in the marketplace. The actual changes to the way things are done occur in the present firm but the strategic planning department helps managers decide what should be done in the future.

Note that with regards to the future firm:

• The work of the strategic planning department may be carried out in-house or outsourced.
• As important as planning is, setting up the systems to put the plans into action is even more critical.
• Just because the strategic planning unit exists, it will not automatically be aware of every new opportunity that may arise. The key advantage of establishing the future firm is it provides a logical, systematic way to evaluate commercial opportunities in light of current strengths. The future firm should not be considered a screening device for every conceivable opportunity of the future.

“To manage the future firm is to manage the firm’s time dimension; to manage the present firm is to optimize its status quo. Both are necessary, neither one alone is sufficient, if the organization is to survive.”

– Jorge Vasconcellos e Sa

“The competitiveness of a company depends on proper management of the short term (the present company) and the introduction of qualitative jumps (managing the future company). Corporate survival requires both management and entrepreneurial skills, the former to manage the present firm and the latter to create the future one. A CEO must, therefore, be both a manager and an entrepreneur. This is the eternal dilemma of management, the reconciliation of the urgent (day-today) and the important (the future). In order to deal with the urgent the chairman has his office and the functional departments. ...

Table of contents

• Title page
• Book Presentation
• Summary of The Neglected Firm (Jorge Vasconcellos e Sa)
• About the Summary Publisher
• Copyright