Butcher or Baker? Two Opposing Business Strategies

For some years now in France there have been recurrent examples of downsizing by firms forced to restructure by changes in their industrial sector (e.g. Danone, Moulinex, Michelin, IBM France, Seb, Hewlett-Packard). This is doubtless an indirect result of economic globalization, which makes competition tougher. Nevertheless, as Hervé Sérieyx shows here, the downsizing is often also the final resort when a firm has not been able – or, rather, dared – to implement other strategies. Strong pressure from shareholders encourages firms to reduce costs by cutting the workforce – a short-term “act of butchery”, as Hervé Sérieyx calls it, quoting Gary Hamel – rather than to develop a strategy for the medium term which tries to mobilize both individual and collective energies. The latter, the “baker’s strategy”, aims to produce greater value-added in the medium term for the benefit of the firm and of the people who work for it, and hence ultimately for the good of society as a whole. Hervé Sérieyx makes a case here for the baker’s strategy, hoping that those involved in the French and European economies will realize that this is the most rewarding one in the medium and long term.