Leader 2030 - Managing Profit-Shifting Forces

 The Executive Study Group (ESG) webinar named “Leader 2030 - Managing Profit-Shifting Forces” was held by Asia Pacific Institute for Strategy Limited (APIFS) on 19^th May 2026. The webinar aims to discuss how to manage profit-shifting forces based on Prof. Michael Porter strategy. The content included to understand industry profitability drivers and consider buyer, supplier, new entrant, competitor and substitute.

In the beginning, Dr. Mark Lee mentioned the profit formula that profit equal to revenue minus cost. He said we don’t discuss the revenue and cost but another factor could enhance the profit!

Then Dr. Lee quoted Prof. Michael Porter foundation strategy and focused on finding right position in the industry.

He reviewed average return on invested capital (ROIC) in US industries from 1992 to 2006 and found that the ROIC range was from 7% to 25%. 

After that we surveyed our idea which industries have low or high ROIC. It demonstrated that not higher technology product had higher ROIC. 

And then he used Southwest Airlines as case study and showed its unique position in focusing to the price- and convenience-sensitive travelers.

Based on the profit-shifting analysis compared with American Airlines, Southwest Airlines removed Buyer expense and reduced Terminal fee in Supplier expense.

Finally, Dr. Mark Lee demonstrated the Southwest Airlines had higher ROIC and he concluded that positioning is one of key factors to manage profit-shifting force.

Reference:

Asia Pacific Institute for Strategy Limited (亞太策略研究所有限公司) – www.apifs.org

ESG facebook - https://www.facebook.com/groups/esg08

Leader 2030 - Empowering the Next Generation of Leaders - https://www.apifs.org/Leader2030-en

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20251107: Leader 2030 Webinar – Motivational Strategy (II) - https://qualityalchemist.blogspot.com/2025/11/leader-2030-webinar-motivational.html

20251125: Leader 2030 – The Success Secrets of Japan Richest Man from UNIQLO - https://qualityalchemist.blogspot.com/2025/11/leader-2030-success-secrets-of-japan.html

20260430: Leader 2030 - Entering the AI Era: How to Effectively Change the Old Mindsets of Your People - https://qualityalchemist.blogspot.com/2026/04/leader-2030-entering-ai-era-how-to.html

Previous talks summary:

https://qualityalchemist.blogspot.com/search/label/Executive%20Study%20Group