Dealing With Change
Change is constant but let’s be honest change is also scary. Will the next Google algorithm update decrease your traffic? Will a new competitor enter the scene and steal your idea—or your customers? Will a key employee leave at the absolute worst time? Will some new technology make your product or service unnecessary?
These questions aren’t fictitious scenarios. I’ve worked with clients who have faced these exact types of changes. The consequences of these changes range from unpleasant to terrible. You may have an amazing product or service but that doesn’t matter if people can no longer find your website on Google. You might have a strong customer base but that doesn’t matter if those customers see more value in a competitor’s offering. You might have a solid reputation within your industry but that doesn’t matter if a new technology makes your entire company obsolete.
So, what are we to do?
Dealing With Change
There are many proposed solutions to change, but let me tackle three of the more common ones I’ve seen.
Build A Good Company & All Will Be Well
The general idea is that if you build a good company with a strong brand and a loyal customer base you aren’t completely immune from change, but you can weather the storm and avoid the more terrible outcomes change can bring forth. For instance, if Google updates an algorithm that causes your website to lose rankings and causes your website to lose traffic, you can reach out to your loyal base of customers via email or social media (or some other channel) in order to continue to generate sales.
But, would a loyal customer base help newspapers who are struggling economically? Maybe, if they are able to convince enough of those customers to subscribe for ad-free media or pay a small amount to read a particular article. But with so many free options in the news space, I don’t think you can definitively say simply having a “good company” with a “solid brand” or “loyal customers” will help newspapers avoid the negative aspects of the changing nature of how we read the news.
Be The Change
The other advice I’ve seen given is that you have to drive the change yourself within your industry. Essentially, your organization needs to compete against itself—or, as Steve Wozniak at Apple put it, you need a Chief Disruption Officer.
With this mindset, you have the chance of benefiting the most from the change. Would Blockbuster still be in business if it had pioneered online DVD rentals before Netflix? What would have happened had Kodak moved forward with the digital camera? What if Yahoo! was able to purchase the code that became Google?
Of course, it is hard enough to focus on your core business let alone also disrupting your core business. If you do manage to do that, there still isn’t a guarantee of success because any kind of disruption comes with a risk of failure. Even if your disruption works, all you may accomplish is establishing a market for new competitors. To go this route, you have to be confident that you can succeed in making the change before you bet your company’s future on the change.
I’ve always thought Jim Collins’ Hedgehog Concept is an interesting way to approach change. By knowing what you are best in the world at, what drives your economic engine, and what you are passionate about, you can identify your “big thing”—or, for lack of a better word, your niche.
Once you know your niche, you can find new and more effective ways to deliver within that niche. The better your delivery of a product or service, the quicker you can move within your product. This makes disrupting yourself easier and effective delivery certainly helps attract customers that are more loyal. Perhaps if Blockbuster saw its niche differently, maybe they would have embraced a web platform with mailed DVD subscriptions, letting them own that market long before Netflix. Maybe if newspapers knew their niche, they could have helped their readers access all forms of content (not just their own) by creating the dominate search engine.
But the hedgehog concept goes beyond having a loyal customer base or an easier way of spotting which new trends to bet your company on. This creates a solid, defensible position in the market that can help you avoid competition. We all know Google’s niche (simple ability to search and access information). Could a new player enter the market and compete against Google? Sure, but it wouldn’t be easy.
But…Google isn’t completely bulletproof and new technology could certainly disrupt their search engine. Think of it this way. We send fewer letters today not because the US Postal Service doesn’t know it’s niche but because a new technology entered the market (actually, many new technologies) that made sending letters irrelevant. Similarly, humans stopped relying on horses and trains for transport not because those products stopped being good but because new technologies came along that were far better. Could the same thing happen to Google’s search?
Change Is Constant
Ultimately, change is constant. There are many strategies to help minimize the impact of change but nothing will outright stop change or prevent your company from being impacted. My own opinion is that you have to start by embracing the reality of change—nothing is permanent in business (or life, for that matter) so don’t ever assume what you have today will be there tomorrow.
This means you always need to measure and monitor how your business performs relative to your industry more broadly (hint: Elementive can help with this). It means you need to know what your organization does and where you are vulnerable to change affecting you negatively. It means you need to be ready to disrupt yourself, not recklessly but cautiously. Having a solid customer base or a good reputation in your industry will never hurt. Above all, be ready to adapt and grow quickly to overcome whatever changes come your way.