Divisional Growth Strategy: Increase Customer Loyalty, Increase Growth, Increase Profitability
The Company: Global transport and logistics partner
DSV deliver cargo safely, securely and on time anywhere in the world by air, sea, road and rail. They support their customers warehousing needs. Since their establishment in 1976, DSV has been through a series of mergers to maintain a key position in the global transport industry. To put focus on different services and customer segments, DSV separated its operations into three divisions in 2001: Road, Air & Sea and Solutions. The services are being developed, interpreted and tailor-made to meet customers’ increasing demands in respect of product solutions, prices and transit times.
This case focuses on “DSV Road Denmark” and “DSV Air & Sea Denmark” divisions.
- Design a strategy to get one division back on track in relation to growth and accelerate another divisions growth significantly. Increase customer loyalty.
- Co-creation of new divisional growth strategies.
- Design of strategy implementation processes.
- Competence leap for leaders regarding strategy execution and strong day-to-day strategy focus.
- Empowered and strategy focused leadership teams from executive team to floor managers.
- Anchoring of strategy by large scale involvement of employees, strategy communication training for managers, and systematic follow up and review structures.
- Created a strategy focused organisation.
- A united business with share strategy focus across divisions.
- Increased customer loyalty.
- Growth in revenue.
- Increased profitability.
The Challenge: Grow the business
DSV has very high growth ambitions which could not be realised by fine tuning the current processes. The high growth ambitions had to be viewed in line with the long term global recession which significantly impacted global transport needs in a negative way.
Furthermore, due to technological innovations, the whole industry is under rapid change driven by customers’ needs and demands.
DSV had also grown quite significantly in recent years and not all processes and customer interactions were 100 per cent aligned.
Growing a business in a recession market basically means gaining market share, so the job here was to gain market share, increase profits, transform the business to meet customers’ demands and create alignment across all functions and divisions.
The Solution: Creating a strategy focused organisation empowering the individual
Starting with the top management team we facilitated a combined strategy design and leadership team development process. A comprehensive analysis of external and internal factors was conducted to ensure the right decisions were made during the design phase. A systematic and wide-ranging communication package was developed alongside strategic communication training for managers to align the message and drive the launch of the new strategies. Big parts of the organisation were involved in identifying specific initiatives for realisation of the strategy to create strategy anchoring and engagement of all employees. To further enhance the strategy focused organisation an OSM (Office of Strategic Management) was established and a systematic follow up and review structure implemented, to monitor the progress of the strategy and initiate corrective actions for continued success in a timely manner.
The Impact: Tangible results
The creation of a strategy focused organisation and a persistent follow up structure paid off. The two divisions, although significantly different, achieved and increased growth in revenue and profitability. Most importantly the customer loyalty has improved and both divisions will continue harvesting from their efforts during the implementation phase even though the execution process will continue for years to come.
A united top management team now act as role models for a daily focus on strategy and a collective way of servicing customers across divisions. New follow up structures are implemented and new ways of working are a part of daily life for the organisation.
Big parts of the organisation were involved in identifying specific initiatives for realisation of the strategy to create strategy anchoring and engagement of all employees.