Many Western multinationals expect to find most of their future growth in emerging economies. But they have frequently struggled to exploit the opportunity, relentlessly cutting costs and accepting profit margins close to zero. The problem, say the authors, who are all with the innovation consultancy Innosight, is not that those companies can't create viable offerings but that simply transplanting their domestic business models to the new markets won't work.

Reverse innovation-developing ideas in an emerging market and coaxing them to flow uphill to Western markets-poses immense challenges, because it requires a company to overcome the institutionalized thinking that guides its actions. That's why the experience of the automobile-infotainment division of Harman International is so impressive. The U.S.-based business, known for ultrasophisticated dashboard audiovisual systems designed by German engineers, developed a radically simpler and cheaper way of creating products in emerging markets and then applied what it had learned in the process to its product- development centers in the West. Harman did this using a two part approach: radical change from below combined with astute leadership from above.

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Many companies are not dramatically changing to more sustainable environmental practices despite pressure from the investment community, the government and consumers. This study explores a simple model that companies can use to understand and improve supply chain sustainability practices. It applies this model in two case studies, Coca-Cola, a leader in global sustainability, and Apple, a company that has only recently started to develop a sustainability strategy. The model was developed through a review of existing research and an application of supply chain principles. The results of this study demonstrate that following this model to eliminate waste throughout the supply chain will make the supply chain more profitable. The outcomes from this study highlight the importance for every company to do so in order to stay competitive. This study is unique in the relative simplicity of its model, combined with the supporting evidence that a sustainable supply chain is the same as a supply chain that is using best practices to reduce waste. [ABSTRACT FROM PUBLISHER] .

The concept of shared value— which focuses on the connections between societal and economic progress—has the power to unleash the next wave of global growth. An increasing number of companies known for their hard-nosed approach to business— such as Google, IBM, Intel, Johnson & Johnson, Nestlé, Unilever, and Wal-Mart—have begun to embark on important shared value initiatives. But our understanding of the potential of shared value is just beginning. There are three key ways that companies can create shared value opportunities: • By reconceiving products and markets • By redefi ning productivity in the value chain • By enabling local cluster development. Every fi rm should look at decisions and opportunities through the lens of shared value. This will lead to new approaches that generate greater innovation and growth for companies—and also greater benefi ts for society.

A new breed of multinationals from emerging markets is appearing in many industries. Western firms are wrong to underestimate, as they often do, the competitive threat from these firms. The discussion herein highlights the non-traditional competitive advantages these firms use to win at home and abroad and shows how these firms use internationalization not only to exploit competitive advantage but to bolster it. The article concludes with suggestions for how Western managers should respond to the competitive threat from emerging market multinationals.