News

Strategic Excellence – Learning from the Best

When it comes to Strategic Excellence, Google, Apple, Amazon and Facebook are often cited as best practice examples. What makes these companies so successful? In his book ´The Four´, Author Scott Galloway shows that they have not only discovered new business models - they also satisfy basic needs and concentrate on what is essential: Amazon activates our archaic hunter-gatherer instinct, Google addresses our urge for knowledge, Facebook satisfies the need to connect with other people and Apple meets our desire to stand out from the crowd (Handelsblatt, August 31, 2018).

However, there are also excellent small and medium-sized companies in Germany, whose success should inspire business leaders. A perfect example here is Rational AG in Landsberg am Lech, the world market leader of commercial combi ovens. Founded 45 years ago, the company can look back on an extraordinary growth story.

A look at the company´s Annual Report 2017 reveals the following facts: 93% of RATIONAL´s worldwide customers confirm that it offers the highest possible customer value. From 2008 – 2017, turnover increased from 343 to 717 mio euros. In the same period, earnings before interest and taxes (EBIT) climbed from 83 to 188 mio euros – the EBIT margin reached 27 % in 2017! Since going public in the year 2000, the share price increased from 23 euros to 649 euros (+ 2.822 %, September 15, 2018).

What are the strategic success principles behind this extraordinary performance? A look at the Annual Report 2017 and the company´s website shows that RATIONAL – like the above-mentioned ´Four´ - ´satisfies the basic needs of its targets groups and concentrates on what is essential´:

Focus
The company´s focus is on professional kitchens – in particular on the preparation of hot food. The product portfolio consists of only two lines – the SelfCooking Center® and the VarioCooking Center®.

Specialization
RATIONAL considers itself a solution provider for thermal food preparation rather than an appliance manufacturer. This leads to increasingly better and more innovative solutions for its customers.

Customer Value
Besides high-quality products, RATIONAL offers a comprehensive portfolio of services which enable customers to use their appliances in the best possible way at all times. With its Internet platform RATIONAL ConnectedCooking, the company leverages the potentials of digitization to further maximize the value delivered. The financial advantages for the customers are demonstrated via transparent cost-benefit calculations.

Entrepreneur in the Company
All employees act as independent business people within their areas of responsibility. This leads to high levels of motivation and satisfaction as well as strong individual performance.

At first sight, these four strategic principles look quite unspectacular and easy to imitate. What, then, is the true ´secret´ behind this success?

The answer: Consistent application and implementation!

back