Éric Viardot: “Companies that endure have integrated instability into their structure”
A term heard everywhere, and one to which Éric Viardot –professor at SKEMA Business School and author of The Timeless Principles of Successful Business Strategy– restores its full meaning. Having a corporate strategy is not merely about reacting to market shifts; it is about setting a course and knowing how to adapt without losing sight of that direction, in order to balance performance, innovation, and identity. All with a single goal in mind: enduring.
In the corporate world, people talk about “strategy” everywhere without considering what the term actually encompasses. What is your definition of it?
To understand the term, one must look –as is often the case– at its roots: the word strategy comes from strategos, which means “general” in Greek. It refers to both a military governor and a member of the executive branch. Strategy is therefore the set of guidelines and decisions that must be made by a company’s top management. These strategic decisions enable a company to position itself: for example, will it focus on differentiation, or on offering the lowest price?
When leaders devise a strategy for their company, they define a mission –the very purpose of the company’s existence. This is a crucial step, especially for large corporations, as employees in such organizations rarely have direct contact with leadership; thus, they need to know the direction in which the company is heading. It is essential to provide a sense of purpose and articulate a vision that serves as a guiding reference, much like a lighthouse for a ship.
Over time, the decisions made will reveal the main challenges facing each company: should it restructure its management, accelerate growth, or perhaps even shut down operations altogether?
by Éric Viardot
This insightful book serves as a strategic roadmap for building enduring organizations. Ideal for both startups and multinationals, the book provides strategic ideas and tools to ensure companies not only survive but thrive for generations.
You talk about general strategy, yet we often hear about marketing strategy or financial strategy. Can several strategies coexist within a company?
There is only one strategy: the corporate strategy. While there are variations, they all serve this overarching strategy. In fact, what matters most in those expressions such as marketing strategy financial is not the word “strategy” itself, but the specific business function associated should it be marketing, finance, supply chain, or human resources. Each of these functions has a role to play, yet they must all move in the same direction.
Corporate strategy operates at a different level. It sets the course and defines the major strategic priorities, such as growth, acquisitions, or competitive positioning. Each function then contributes to implementing these decisions in a coherent manner.
Should a strategy be established before starting a business, or is it an integral part of the creation process?
It is not necessary to have a perfectly defined strategy from the moment a company is created. What is essential at the outset is to have a vision and, above all, an entrepreneurial mindset. Successful founders are often visionaries capable of rallying a team and surrounding themselves with the right people.
That said, education or experience in designing a strategy can be a real accelerator. It helps structure thinking, gain a better understanding of the business environment, and bring consistency to decision-making. It provides an intellectual framework that helps make the right choices, but it can never replace the fundamental drive to be an entrepreneur.
Ultimately, starting a business requires balancing two dimensions: the ability to step back and gain perspective to provide direction, and the ability to be hands-on and get into the nitty-gritty of operations. Above all, however, what matters is the entrepreneur’s personality.
Should we always hold on to strategy as a lifeline, or can we move away from it as circumstances change?
Strategy is based first and foremost on a vision and a mission. Take L’Oréal: from the outset, the idea was to make women more beautiful. That vision has endured, even as products, markets, and ways of doing business have evolved
Obviously, a company must adapt to its environment, market shifts, consumer expectations, and societal changes. Yet, this ability to adapt does not replace strategy; on the contrary, strategy is what makes adaptation possible.
I often distinguish between being reactive and being strategic. A company can be excellent at execution and make decisions very quickly, but if it does not know where it is headed, it simply risks moving faster… in the wrong direction. Strategy is precisely what provides the direction.
How can an established company innovate without betraying its identity?
That is precisely what interests me. I focus primarily on companies that have been around for decades, sometimes even centuries. Delivering short-term performance is one thing; what is truly fascinating is the ability of certain companies to span generations without losing their identity.
They share several characteristics. First, they rely on a strong culture that provides both direction and identity. Yet, they never stand still; they know how to rethink their organization when the environment changes. This is where innovation becomes essential.
Companies that endure are those that manage to evolve their structure without abandoning their culture. It is a difficult balancing act, especially for market leaders. There is a natural tendency to stick to the formulas that drove past success, even as the business environment continues to change.
Two other ingredients are indispensable: leadership and succession planning. Long-lasting companies know how to identify the right leaders, but, more importantly, how to prepare for the handover. Take the LVMH Group, for instance which is currently facing a question that all major corporations eventually confront: how to ensure a smooth transfer of leadership without weakening the company’s overall vision and project. For me, this is one of the best indicators of successful leadership.
Innovating, then, also means evolving one’s organization?
Absolutely; innovation and change management are too often pitted against each other. In many educational programs, innovation falls under marketing or technology, while organizational change is dealt with within human resources. Yet, at the strategic level, the two are inseparable.
Innovation is not just about launching a new product; it also involves transforming the organization and evolving its business functions, skill sets, and sometimes even its operating model. The arrival of artificial intelligence (AI) is a perfect illustration of this. It does not simply change the tools we use; it also forces companies to rethink the way they work.
When a company splits or merges, how can you avoid a kind of identity schizophrenia?
There is no single model. It all depends on the reason why a company carries out a merger or acquisition. Some companies are primarily looking to gain market share or enter a new segment. Others want to acquire skills, technologies, or talent. In the latter case, the question of corporate culture becomes central. Major technology groups like Google have understood this well: when they buy a young company, they are not only looking to integrate a technology, but also the teams that developed it.
The challenge is to find a balance between the culture of the acquiring company and that of the acquired company. Integrating two different cultures is a real management challenge. It is essential to preserve what makes the acquired company valuable while integrating it into a common project.
Every transaction is a special case. But everything ultimately comes down to leadership. Leaders who successfully navigate these types of transformations are often those who know how to listen, challenge their own assumptions, and bring out the best in both organizations. This is an essential quality when seeking to build a company capable of enduring.
Can a company survive without being high-performing, or be high-performing without enduring?
A company can be high-performing without achieving long-term success. Imagine a company losing market share and deciding to cut its prices drastically to win that market share back. In the short term, the results will be there, but at the expense of profitability. Similarly, a company can boost performance by constantly demanding more from its employees, an approach that works only until the staff is burned out.
By contrast, a company cannot endure without being high-performing. A company’s resilience is precisely its ability to maintain its performance over time. This is the core challenge of strategy: striking a balance between immediate results and the creation of long-term value. Doing so requires resisting short-term pressures, particularly financial ones. The case of Boeing is telling: by prioritizing financial profitability at the expense of industrial excellence, the group ultimately undermined its own business model. Short-term performance must never compromise the company’s long-term viability.
Read also: Microsoft’s Playbook for Thriving in Uncertainty
Conversely, companies like Apple demonstrate that an organization can span generations if it prepares for succession. The transition from Steve Jobs to Tim Cook is a particularly interesting case. Tim Cook did not seek to replicate his predecessor; instead, he consolidated the organization and the supply chain, enabling Apple to continue its growth. The challenge now facing Tim Cook’s successor, John Ternus, is to launch a new cycle of innovation, yet the company rests on a solid foundation.
Strategy is not about maximizing performance in a single year; it is about building a company that will still be performing well fifty years from now.
In many of your articles, you discuss the external environment and its impact on a company’s resilience and performance. How can a sustainable strategy be established in an unstable environment?
It is precisely at times like these, when the external environment is shaky, that strategy becomes crucial. When formulating a strategy, you are thinking about the long term. All major companies that have been around for more than 50 years have weathered a multitude of crises, particularly geopolitical ones. They are equipped to face such turbulence; they have integrated instability into their very structure and culture.
Is the world really more uncertain today?
No, it is not fundamentally more uncertain than it was 50 years ago. Every era has experienced its share of upheavals: the revolutions brought about by electricity, the automobile, and oil; the arrival of the internet; the two World Wars; and decolonization. All of these events profoundly transformed the business landscape.
What sets the current period apart is the level of economic globalization. This makes companies more exposed to international events. What also explains this heightened feeling of uncertainty is the fact that the last ten to fifteen years were relatively stable, with relatively smooth globalization, contained prices, and an absence of direct confrontation between major powers. The resurgence of geopolitical tensions creates the impression of a rupture, whereas history shows that these cycles are recurring.
Donald Trump is often cited as a source of instability, but the Reagan years were also marked by the Cold War and numerous international conflicts. In this context of cyclical change, a company’s ability to adapt to shifts in its environment remains a decisive factor in its success and longevity.
Can you identify companies that seem eternal to us but are more fragile than one might imagine?
Consider Meta. Despite its impressive customer base, it is a company whose products could easily be superseded, and it relies heavily on its founder’s personality. Furthermore, it operates under a legal Sword of Damocles. There is nothing to prevent us from imagining that the next U.S. president could take a stance against technology monopolies; after all, Trump himself was opposed to them not so long ago.
Take Tesla as well. Although it has helped popularize the electric car, it faces significant competition from Chinese companies. Not to mention the difficulties it is encountering in establishing itself in Europe, given its CEO’s geopolitical stances.
And a company that impresses you?
Google, without hesitation. The quality of its management is remarkable, as is the strategic vision of its successive leaders. They have also managed to develop a decent degree of ethical responsibility without becoming overly arrogant, unlike some other technology companies.
