Beyond Great: 9 Strategies to Thrive in a Post-COVID World (with BCG Senior Partner Nikolaus Lang)

We were pleased to speak with Dr. Nikolaus Lang, BCG Senior Partner and one of the authors of the new book, Beyond Great. In the book, Niki and his colleagues, Arindam Bhattacharya and Jim Hemerling, identified nine strategies for companies to thrive amidst the dynamic forces of social tension, economic nationalism, and digital transformation affecting global business today. The book is an easy read, filled with lots of real world examples, and will give business professionals and consulting candidates alike a glimpse into strategies businesses are wrestling with across industries today.

Listen here or on your favorite podcast channel, and read the transcription of the conversation below.

MC

00:35

Niki, thanks so much for joining us today.

Dr. Nikolaus Lang

00:56

It's a pleasure! A warm welcome from Munich.

MC

01:00

Thank you so much. Well, let's dive into the book. So you and Arindam and Jim, you came up with nine strategies that business needs to do moving forward. Now these seem to be born out of a set of shifts on globalization that you identified. Social tension, geopolitical shifts, technological transformation, that these new fundamental forces or these ever-changing fundamental forces really require businesses to operate in a new and different way. Could you speak briefly to each of those three forces?

Dr. Nikolaus Lang

01:38

Yeah, of course. Stephanie, I think what you see in the world in which we are now is that, I would say, especially in the last decade, in the 2010s, we have seen those three forces gaining in momentum, and also gaining in impact for global business.

First, let's talk about social tension. Social tension ranges from climate change, where I don't think that I need to give any examples of what's happening. If we look at just the last summer, all the fires and all the challenges we see, I think makes it very clear that we are at the brink of a massive shift. But also social tension at the larger when you look at the gilets jaunes movement in France, or the social unrest in Chile, there are many situations where social unrest and social inequity becomes a big burden for economies and businesses at large.

So that's social tension. Then there's a second movement which we call economic nationalism. And you called it geopolitical shifts, which is perfectly right. But we believe that, especially in the last five years, we have seen a constant rise of economic nationalism. And this rise is driven by the fact that you have you have seen political decisions, ranging from Brexit to the US-China trade tensions that have made global supply chains more and more fragile.

Because if you're importing goods from country A to country B, and you don't know if the next day you have to pay 20% tariffs on top, the supply chain really changes. And so in the past, everyone was thinking that the world is flat, and that you have a world of free trade, but there are a lot of mountains that started rising in the last five years and that has been driven by the political environment.

And adding to this, COVID hasn't simplified the situation. We have seen what happened with COVID. Suddenly, we had export restrictions, we had vaccine diplomacy, we had disrupted supply chains, and things like this. So I think economic nationalism is a reality which will go with us over the next decades to come, whether we like it or not.

And then the third topic which is digital transformation. People will say, "We all know that things get more and more digital," but the reality today is that we see the speed of digital ever increasing.

And again, I think the first iPhone is 14 years old, but my daughter is also 14 years old. So if I imagine that all the digital transformation that's happened in her lifespan so far, it's really amazing.

And, on the other side, we see that obviously through COVID but also before, the level of remote services, the level of distant working, and so on has increased massively over the last years.

So, those three elements - social tension, economic nationalism, and digital transformation - create a uniquely challenging environment for business leaders. And that's why Arindam, Jim, and I thought we want to write that book, which we actually started writing long before COVID hit and which then became very relevant in that specific situation.

MC

05:21

I imagine the three of you, across your client bases and colleagues probably came up with a huge swath of ideas of all the different things that companies should do with respect to these three forces. You landed on nine strategies, but can you just talk us through a little bit of the journey of how you collaboratively identified these nine?

Dr. Nikolaus Lang

05:47

If you just take together the tenure of Jim and Arindam and myself at BCG, we're getting close to a century or somewhere between 80-100 years. And over these 80-100 years, you really have the privilege to be exposed to many, many corporate realities.

And I think that also makes the book uniquely interesting because you have more than 50 in-depth case studies of companies that we have analyzed. The companies have obviously approved that we can write about them. And I think it was this mixture of these external forces and the reality we see in some of our clients, but also other companies.

In this book, we don't only have BCG clients, we also have companies we deeply admire and we said we would like to profile them. So, from that perspective, I think it was something that came out of these three forces and our personal experience and our colleagues' experiences that drove us to write those books and to identify those nine strategies.

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MC

06:57

Absolutely. It already sounds like this book was written over a long period of time, even pre-COVID and, at least at the time of writing, you stated that you didn't see any company out there that was really, truly employing all nine of these strategies, three to four at most. Is that still the case? And do you think it's even possible for one company to do all nine of these well?

Dr. Nikolaus Lang

07:24

Well, I would say the large majority is covering two or three or four strategies. There are a few companies that are getting close to being strong on many of them. I think, at the end of the day, if you want to be successful in the decades to come, employing these nine strategies, and aiming at being strong, maybe not always best practice, but being strong, is actually what is required for a sustainable development going forward.

Let me give you just a few examples. Our number one strategy is around corporate social responsibility and total societal impact. We believe that there are companies that are very strong in this. Take Natura, the Brazilian cosmetics firm that also owns Avon and The Body Shop, and so on. Since their beginning in the 1980s, they have put social responsibility at the middle of their role. It's not something you put nicely on an advertisement.

But this was the core of their strategy, the way they produce cosmetics based on organic inputs, the way they use sales representatives that are being trained among Brazilian women to sell those products. All these things show that corporate social responsibility and social impact is something that has to come from within, and has to really go through the whole value chain. It's not just a nice marketing gimmick at the end of the value chain. So I think that's something that is very important.

Another thing which is very close to my heart is ecosystems. In the past, companies were just buying each other, they were doing M&A and they were doing joint ventures and things like this. We believe that, while these topics are still relevant, many new technology developments require ecosystems, much more flexible networks of companies that are working together around a common purpose.

So I think that's also something that is very important. And if you take large car OEMs, for example, we have profiled VW, the car manufacturer doing autonomous cars and electric cars and ecosystem is something which is very important.

The third topic is the always on transformation. In the past, we saw when consulting companies were doing a transformation and they said, "Oh, we've transformed and now we continue on that transformed path for the next 10 or 15 years and then we do it again."

If you look at a company like Microsoft, for example, that's a company that has taught many people that transformation is actually never over. It's always on. So these are just three topics which I believe, next to operational excellence, cost management, and so on and so on, are elements that companies of the future need to embrace.

MC

10:21

I would love to shift over into to your work for a second, especially this always on transformation, the continuous improvement mindset that you're kind of speaking to. Has your identification of the importance of that shifted the way in which you want to work with and engage with your clients?

Dr. Nikolaus Lang

10:46

Yes, because what we have seen in the past - I've now been with BCG for almost 25 years - so when you look back, in the 1990s, projects often tended to be limited to a specific study, a specific topic of study, and then a delivery to the senior management.

I think over those 25 years, we have increasingly seen the involvement of working side by side with the client, taking more responsibility for not only doing the analysis, but also co-implementing it. Or lately, when you look at our digital businesses, kind of co-creating new ventures with clients. So yes, I think that's a much more integrative and continuous way of collaboration than we used to do 20, 30, or 40 years ago.

MC

11:44

And you alluded there to your second strategy of leveraging digital technology, offering digital solutions. For this next generation of consultants, for candidates who are looking at getting into the space, many of them are considering whether or not they want to, off the bat, specialize in this digital space. Tell us a little bit what you think about that growing piece of the industry, and how should those considering consulting today weigh the choice of being a generalist versus focusing in digital?

Dr. Nikolaus Lang

12:23

That's an excellent question and, as I told you, I have a 14 year old daughter and I have two other kids, and they always ask what they should do. Maybe they're a little bit premature in asking those questions, but we have quite a bit of discussion around the kitchen table on jobs and so on.

Coming back to the question specifically, when I joined BCG 25 years ago, I was a pure generalist. I had a PhD in Business Administration, having studied in Japan and China and everywhere, and then joining the industry and doing a kind of a traditional broadband start, then specializing over time in automotive and mobility. And that's actually my home turf today.

Although it's quite interesting seeing as that over the last 10 years, my work has shifted more and more towards digital in automotive and mobility. So today, I would say half of my business is actually digital work for automotive and mobility clients.

Now, when you are at the beginning of a career, I think fundamentally both paths are very interesting and I have lots of discussions with candidates. Again, if I may call it the traditional path, or the broad generalist path still has the big advantage of being exposed to a series of different industries and bringing your analytical firepower to different client settings.

At the same time, I think in the digital area, we have very different application areas. And we have very different possibilities to really use IT skills. So at BCG, for example, we have people that are specialized in IT implementation, that's BCG Platinion. We have data scientists with BCG GAMMA, or we have digital venture builders with BCG Digital Ventures. So I think again, what I want to say is that when you are coming with a strong digital background, you can also actually do a broadband career, given that you have very different areas of involvement at BCG.

MC

14:31

Absolutely. I'd love to dive in a little bit and see how a different strategy also applies at home at BCG. Strategy eight, you're talking about building and maintaining a digitally savvy, engaged workforce. So how do you apply that internally? How do you think about that at BCG?

Dr. Nikolaus Lang

14:54

I think it is critical to have a digitally savvy workforce. Whether you are in consulting or in any other sector, because I think digital has become such a core element of everyone's activity, that you would not be able to deliver the performance you're expected to deliver without having an understanding there. So I think this is clear.

And that implies the fact that I think is really important is that - now coming to your question, what do we do at BCG - on one side, we have a very different set of candidates, because I would say all our older colleagues that join our digital businesses, including also our core technology advantage practice, have a strong exposure to digital.

But then when you look at all the tools we use in our analytics, whether it's Tableau, whether it's Alteryx, and other elements, I would say every consultant in BCG has a strong digital skillset and sees this digital skillset evolve over the first one, two, or three years of his or her career at BCG.

MC

16:34

And that second part of that strategy, a broad deep consistent engagement of your workforce, you know, attracting top talent, retaining top talent. How are you thinking about that now in in your firm and in your area of the business?

Dr. Nikolaus Lang

17:11

Attracting talent and keeping talent has to do a lot with culture, with the way we do work, with the way we interact with our clients. And I keep saying that our DNA, our culture is one of our strongest assets. And this is why we always make sure that the teams are really closely linked, and this challenging in a COVID environment where people are working from home, and how can you make sure that that also comes across. But I think this is one of the key elements going forward. As an industry specifically, we need to make sure that people really have the feeling that they are on purposeful engagements that really support those people that move the world.

MC

18:14

There's certainly a ton of people who are wanting advice, like how might I join the ranks of BCG? What are one or two pieces of advice you would give those prospective candidates?

Dr. Nikolaus Lang

18:28

I think maybe just coming back to my own history, and then having seen how things have evolved over the last two and a half decades. I think first of all, it's really important to understand the landscape of consulting. And really understand who is out there, who is offering services, and how do these companies fit into my own profile? I think this is something that's really important. I think this honest alignment match between your profile and the different companies' profiles is very important.

Then I think the second one is obviously to reach out. Send your CVs, send your reports, and really show a profile that is interesting. I think today we have many great colleagues around the world that obviously have a strong academic track record but they have also been engaging in professional or pre-professional activities (ex: internships), but we also increasingly look for what people have been doing in extracurricular activities. How have people been engaged in social impact activities and local community activities or any other activities? I think this plays an important role.

Then the third topic is, I would always thoroughly prepare for the recruiting events and recruiting activities. There are different combinations of interviews and interview settings. And I think that's something which can be prepared for, to a certain extent.

So those would be my three things. First, really scan the market and look at where you believe you fit or don't fit. And also, when you ask about BCG, ask to find out which of the different aspects of BCG is most appealing to you. And second, reach out and third, prepare well.

MC

20:44

Absolutely. You talked about where the firm sets in terms of the broader consulting industry, so when you think about BCG, and the specific qualities that you're looking for, what do you want to be true of the next generation of your consultants?

Dr. Nikolaus Lang

21:05

I think there's a mix of what I would call traditional values and new values. But honestly, the most important element I'm looking at when I see new candidates is first, their own empathy. Do people have empathy? Because consulting is about understanding other people's situations. And that you can only do if you have empathy.

Then comes to the topic of analytical rigor, then comes the topic of digital skills. And what we're also looking at is, do people have their own purpose in life? What is their purpose? What makes them move? I think that those are the four elements I look at.

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MC

21:57

In terms of your purpose, what keeps you moving? You know, what is it that you love about this work? What's kept you in it for 25 plus years?

Dr. Nikolaus Lang

22:08

Well, it's interesting, because this is a question I get asked very frequently by friends, by colleagues, by clients. And for me, I think it's a mixture of three things. First, and this reflects a little bit of the generalist I am - the breadth of the topics. So the breadth of the topics and the intellectual challenge of the topics. That's something that always makes me very excited about the work I'm doing. There's not one project that is similar to the other one. So that's one.

Number two, I think the outstanding quality of the people, and by quality, I mean the things I mentioned - empathy, cultural fit, engagement is something which I like a lot. And where I take a lot of pleasure from it.

And the third one is long lasting client relationships. You know, I'm working with clients that I know for, not 25 years, to be honest, but 22 years. And accompanying a client for 22 years as a corporation, but also as a person is something I find extremely valuable, and seeing how this environment evolves makes makes me extremely satisfied. It has kept me in that job for almost 25 years.