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Business Week’s 50 Top Performers March 20, 2007

Posted by Stephanie in Customer Service, Finances, innovation, Internet, Manufacturing, media, pharmaceutical, Public Interest, Retail, Technology, telecommunications.
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Business Week recently announced its yearly 50 Best Performers article in the March 26, 2007 edition of the magazine. When first looking even at the title of the article I was skeptical about how these companies were selected. It seems impossible to compare every company in every sector and rank their performance. I was pleased however to find their criteria for making the selections seems to be as fair as possible.

Financially they use specific criteria and what they look for in companies when making this list. The two principal financial figures Business Week uses in its analysis are average return on capital and sales growth over the past 36 months. They also consider the importance of examining sectors separately, as factors within one particular sector may inflate or deflate the appearance of a company’s performance unfairly.

Specific quotations I highlighted when reading the article regarding what BW determines as strategies for success:

“…rewriting the rules of engagement in their industries.”

“…a deep understanding of customers, a competitive advantage that has enabled them to sell more good and services than rivals.”

“…work hard to anticipate and head off potential problems well before outsiders are even aware of these looming challenges.”

Details about all 50 companies are included in the compilation of roughly 40 pages of discussion. One particular company I had not heard of before, ranked 31 is Stryker. The company manufactures artificial joints, such as knees, shoulders and hips. Part of their success is due to the baby boomer generation who show no signs of slowing down in retirement even as natural aging takes is toll. Anther interesting aspect of the company is its preparation in changing CEO’s. As the current CEO, John Brown is planning on retiring, COO, Stephen MacMillan has had roughly 4 years to shadow and plan the transition. Both the process the company has developed for the transition and the mere fact that the CEO is not being forced out of the company it seems are two incidents not seen as often anymore.

I am still hesitant to agree that companies covering the full spectrum of all organizations and industries can not only be compared but ranked in a hierarchy. Business Week does an excellent job at attempting this challenge but I feel that some subjective factors weigh into the decision, especially between close rankings, say between spot 8 and 9.

 

1 Google

2 Coach

3 Gilead Sciences

4 Nucor

5 Questar

6 Sunoco

7 Verizon Communications

8 Colgate-Palmolive

9 Goldman Sachs Group

10 Paccar

11 Amazon.com

12 Cognizant Technology Solutions

13 Avon Products

14 Varian Medical Systems

15 Bed Bath & Beyond

16 CB Richard Ellis Group

17 Robert Half International

18 Chicago Mercantile Exchange Holdings

19 Adobe Systems

20 EOG Resources

21 Sempra Energy

22 Sherwin-Williams

23 Lehman Brothers Holdings

24 Rockwell Collins

25 IMS Health

26 Allegheny Technologies

27 Oracle

28 Starbucks

29 Moody’s

30 PepsiCo

31 Stryker

32 Best Buy

33 United Parcel Service

34 Apple

35 T. Rowe Price Group

36 Valero Energy

37 Constellation Energy Group

38 TJX

39 Morgan Stanley

40 Paychex

41 Coventry Health Care

42 United States Steel

43 United Technologies

44 Hershey

45 Black & Decker

46 Synovus Financial

47 Linear Technology

48 AT&T

49 XTO Energy

50 PNC Financial Services Group


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Comments»

1. silviamocanu07 - March 21, 2007

I think that Business Week’s attempt is certainly very interesting; however, it must be taken into account that the criteria by which these organizations were measured are not all-encompassing.

Although I do believe that innovation, customer focus and constant awareness of the internal environment are highly important to any organizations, these are not all of the important criteria.

Furthermore, I agree with Stephanie that it is difficult to compare such different organizations, from Starbucks to the Goldman Sachs Group, and put them in the same ranking. The operations and needs of these orgazations are very different, consequently I am not sure how accurate it is to put them in the same ranking.

2. Meg - March 21, 2007

I find it surprising that Apple is as low (in a negative way) on the list as it is at number 34. In 2006, the company experienced sales of $19.3 billion whereas Coach, for example, that ranks number 2 only generated sales of roughly $2 billion. I understand that sales aren’t the only factor Business Week took into consideration in ranking the 50 Best Performers. But, with a partnership beginning in 2005 with Intel enabling the company to introduce such innovative products as the MacBook Pro and the iPhone, I’m surprised that they don’t rank higher (or lower depending on how you view the #1 position) on the list.


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