New Luxury Management: Creating and Managing Sustainable Value Across the Organization

318 Pages·2017·4.41 MB·English

by  Emmanuelle Rigaud-Lacresse

PALGRAVE ADVANCES IN LUXURY
NEW LUXURY
MANAGEMENT
Creating and
Managing Sustainable
Value Across the
Organization
Edited by
Emmanuelle Rigaud -Lacresse
Fabrizio Maria Pini
Series editors:
Paurav Shukla & Jaywant Singh
Palgrave Advances in Luxury
Series Editors
Paurav Shukla
Department of Economics
Glasgow Caledonian University
London, UK
Jaywant Singh
Kingston Business School
Kingston University
Kingston Upon Thames, UK
Aim of the Series
The field of luxury studies increasingly encompasses a variety of perspec-
tives not just limited to marketing and brand management. In recent
times, a host of novel and topical issues on luxury such as sustainability,
counterfeiting, emulation and consumption trends have gained promi-
nence which draw on the fields of entrepreneurship, sociology, psychol-
ogy and operations. Examining international trends from China, Asia,
Europe, North America and the MENA region, Palgrave Advances in
Luxury is the first series dedicated to this complex issue. Including mul-
tiple perspectives whilst being very much grounded in business, its aim is
to offer an integrated picture of the management environment in which
luxury operates. It explores the newer debates relating to luxury con-
sumption such as the signals used in expressing luxury, the socially divi-
sive nature of luxury and the socio-economic segmentation that it brings.
Filling a significant gap in our knowledge of this field, the series will help
readers comprehend the significant management challenges unique to
this construct.
More information about this series at
http://www.springer.com/series/15396
Emmanuelle Rigaud-Lacresse • Fabrizio Maria Pini
Editors
New Luxury
Management
Creating and Managing Sustainable Value Across
the Organization
Editors
Emmanuelle Rigaud-Lacresse Fabrizio Maria Pini
NEOMA Business School MIP, Politecnico di Milano
i3-CRG École polytechnique, CNRS, Milan, Italy
Université Paris - Saclay
Paris, France
Palgrave Advances in Luxury
ISBN 978-3-319-41726-4 ISBN 978-3-319-41727-1 (eBook)
DOI 10.1007/978-3-319-41727-1
Library of Congress Control Number: 2016957714
© The Editor(s) (if applicable) and the Author(s) 2017
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Introduction
Luxury, as well as luxury markets and luxury management, has received
a growing interest in the past decade, both from researchers and prac-
titioners. This has generated a large amount of literature on these sub-
jects, covering various aspects and offering different perspectives and
interpretations. The luxury goods industry still remains a growing one,
despite the big changes that have taken place in the last few years at
economic, technological and social level, bringing some increasing tur-
bulence and calling for strategic readjustments among the industry key
players. The willingness of consultants and researchers to understand the
reasons beneath this almost endless pattern of growth partially explains
the interest in this domain. On the other hand, companies and brands
outside the traditional luxury industries progressively adopted practices
and approaches that generated in the core of luxury goods, from limited
series to customization services, in an effort to increase the overall cus-
tomer experience and differentiate from a growing number of me-too
players. This second aspect accounts for the need of a deeper understand-
ing of the processes, assets (both tangible and intangible) and competen-
cies that allow luxury companies to create value for their very particular
clientele in order to assess their replication in different industries and
price segments.
In this sense, this book presents the different aspects that make luxury
companies a sort of unique combination of competencies and assets and
v
vi Introduction
provides a “luxury specific” understanding of how value is created in the
luxury markets. In order to achieve these goals, the authors devoted their
attention to: (i) the uniqueness and specificities that make luxury com-
panies so different from the ones belonging to other industries; (ii) the
characteristics of their most valuable assets; and (iii) the key processes in
the value chain of luxury companies and how they are managed. This
text might rely upon a unique combination of authors (coming from
French and Italian leading business schools with strong backgrounds in
luxury) who, though being experts in their own disciplinary field, share
a common vision of the luxury value creation processes and assets that
have been established through their involvement as faculty members of
IMLUX Master Programme developed by Mip, Politecnico di Milano
and Neoma Business School, and supported by companies such as Gucci
and Champagne Taittinger.
This common vision involves the description of “the new luxury”, that
is, a contemporary and comprehensive description of what creates value
in luxury markets through a comprehensive view of: (i) the value chain,
from concept to market; (ii) the unique combination of skills and assets
that make luxury products and service so special to the eyes of customers;
and (iii) the patterns and strategies for growth adopted by luxury com-
panies. The authors argue that the main characteristics of “luxury” are
linked to specific resources and competencies found throughout the value
chain within companies operating in the luxury sector and in their value
network of stakeholders. Among the key resources for luxury value cre-
ation a unique blend of knowhow and skills and strong and deeply evoca-
tive brand narratives plays a crucial role and accounts for luxury-specific
managerial practices. This mix of assets and competencies is operational-
ized in key processes that involve the creative one as well as supply chain
management, retail and communication aspects that might adapt to the
dynamic and evolving global marketplace, changing consumer behav-
iours and new technologies. The way luxury companies manage their
growth results in their uniqueness in terms of assets and key processes
and shows peculiar aspects. These aspects contribute to the definition
of organic growth options through exploitation of assets or mergers and
acquisitions that call for a specific organizational culture to preserve assets
after mergers are over.
Introductio n vii
This book therefore presents an interdisciplinary approach for the suc-
cessful creation and management of value across the organisation: leader-
ship, human resources, financial, strategic, marketing, economic and legal
perspectives are addressed in order to understand each process in depth
and all aspects related to value creation and its management. Moving
from the creative process to the distribution of luxury products and ser-
vices, the book provides an integrated approach to the full value chain.
This includes functional processes such as design, operations, SCM, on
and off line communications and retail management from a disciplin-
ary and academic perspective. Moreover, it provides a comprehensive
approach to the management and evaluation of luxury intangible assets.
This book covers both strategic and functional aspects of luxury man-
agement providing a comprehensive yet coherent and integrated vision
on the subject. The book is divided into four parts that encompass: (i)
an operational definition of luxury and the traits of uniqueness of luxury
companies compared to the ones that operate in other sectors; (ii) the key
intangible assets and competencies that support luxury value creation;
(iii) the management of the key processes of value creation for luxury
firms (product and collection design, operations and supply chain man-
agement, service and customer experience design, store management,
integrated marketing communication); and (iv) growth issues in luxury
companies (evolution and dynamics of business models, integration of
competencies post M&As, selecting and empowering people for com-
pany growth, international retail strategies and operations for sustainable
growth).
This book is targeted at master level students, both at MSc and MBA
level, willing to gain a global overview of the key aspects that define the
process of value creation in luxury industries as well as practitioners look-
ing for an up-dated comprehensive description of the main aspects and
characteristics of luxury companies and their growth patterns and strate-
gies under a unique and common perspective.
Fabrizio Maria Pini
Emmanuelle Rigaud-Lacresse
Acknowledgements
The editors and authors would like to thank Margareth Henriquez and
Vitalie Taittinger for their kindness and participation in the interviews
reported in the Chap. 2 “Luxury Dynamics” and Chap. 13 “Growth
Archetypes in Luxury Companies” and Silvia Loffredo for reviewing with
passion and competence Chap. 12 “Creating a Seamless Experience for
Luxury Consumers Integrating On and Offline Communications”. A
collective thanks to all our colleagues and IMLUX students at Mip and
Neoma who provided us with valuable insights, challenged our assump-
tions and pushed us to give our best in this effort.
ix
Contents
1 Luxury as a Construct: An Evolutionary Perspective 1
Alessandro Brun
Part 1 Discovering Luxury 19
2 Luxury Dynamics 21
Emmanuelle Rigaud-Lacresse
3 Global Organizational Leadership for Luxury Companies 33
Karina R. Jensen
4 Financial Reporting and Communication in the Luxury
Industry 47
Laurent Hervé
xi