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How to Strategize for Robustness: Infographic

In a recent Harvard Business Review piece, Martin Reeves, senior partner at the Boston Consulting Group, the director of the BCG Henderson Institute, and a coauthor of Your Strategy Needs a StrategySimon Levin, Professor of Biology at Princeton University, and Daichi Ueda, associate at the Boston Consulting Group and an ambassador to the BCG Henderson Institute, describe what they call “The Biology of Corporate Survival.”

it’s an important concept for any business leaders, as the authors “investigated the longevity of more than 30,000 public firms in the United States over a 50-year span.”

Conclusion:  The results are stark: Businesses are disappearing faster than ever before. Public companies have a one in three chance of being delisted in the next five years, whether because of bankruptcy, liquidation, M&A, or other causes. That’s six times the delisting rate of companies 40 years ago. Although we may perceive corporations as enduring institutions, they now die, on average, at a younger age than their employees. And the rise in mortality applies regardless of size, age, or sector. Neither scale nor experience guards against an early demise.”

So how can you determine where your company sits in terms of corporate survival? The team provides several tools to help individual businesses conduct their own initial reviews:

  • This Online Diagnostic Tool helps you answer “How Robust is your Company?”
  • This Longevity Calculator helps you determine “Is Your Company About to Fail?”
  • The below infographic — How to Strategize for Robustness — outlines a view of business environments, key principles companies are putting into action, and four key questions leaders need to ask to “achieve robustness and ensure survival,” and more.