This is no time for complacency.
Successful companies around the globe are finding themselves blindsided by disruptive forces in their industry, many of which they didn’t see coming.
To survive, leaders need to be constantly looking forward to identify trends or market forces that could impact their business … in a positive or negative way. This means taking a good hard look at their business strategy and having the courage to question everything to ensure they are well positioned to prosper in a future whose only constant is change.
Defending Against Attackers
When you’re making record-breaking profits or experiencing steady growth, it can be tempting to sit back and happily maintain the status quo. We’re successful, we don’t need to change anything, right?
An army of entrepreneurs with nimble and dynamic businesses born in the cloud are already looking at every established industry and trying to figure out how to do it better, faster, cheaper by utilizing the public cloud, analytics, IoT, and online services.
Just look at what Uber and Netflix have done to their respective industries.
If you have a well established, or we could call it an analog business model, and you are not thinking about how to transform, I don’t know if you will ever be able to react in time to recover to stave off disruptive competitors.
Sounding the Death Knell
Some stats show there are three new internet based companies born every second but I came across a startling report from Gallup that shows in North America business closures are outpacing start-ups. Four hundred thousand new businesses are being born annually nationwide, while 470,000 a year are dying.
Are we seeing the death of entrepreneurship in America? I don’t think so but there has to be a fundamental change and it’s one that Accenture noted in its Accenture’s Technology Vision 2016 report.
… the real frontrunners will embrace disruption as part of their corporate DNA, inspiring their people with a vision for how technology enables processes to be done differently—to be done better—so that the business can follow a completely new direction.”
I couldn’t agree more.
In my role at Intel, I travel across North and South America and meet with executives in a range of industry sectors. If I were to assess the companies I meet, I’d say it’s a mixed bag when it comes to readiness for change. Accenture has found that a majority of executives have gotten the memo and realize change is inevitable. This report found 82% of executives feel their organizations are being pressed to reinvent themselves and evolve their business before they are disrupted from the outside or by their competitors.
In my travels, I am seeing a number of companies with very progressive leaders who are ready and working to transform into digital businesses. Others are not and I fear that if they don’t act soon, someone’s going to eat their lunch.
Time will tell who the winners and losers are going to be.
Break the Business Mould
It’s tempting for the big established companies to think they can’t respond quickly to the disruptive forces in the market. It takes time to turn discussion into action at a large organization, right?
I’d say they’re wrong. You only have to look at a company like GE and the transformative change driven by Chairman and CEO, Jeffrey R. Immelt. He took a company with a long history and successful financial track record, known for industrial manufacturing, and transformed it into a digital industrial company that leverages inter-connected software-defined machines and solutions.
From the ground up and across both the employee base and executive suite, Immelt fundamentally changed the organization and its culture and he was successful in making this difficult shift. Today’s GE isn’t the traditional, conglomerate, stodgy business of yesteryear, it’s a modern digital business. GE has been named one of America's Most Admired Companies and one of the World's Most Respected Companies; and prospective employees are taking notice. GE is now attracting millennials who might otherwise have looked for positions at companies like Google or Facebook.
And, we’re going through our own transformation at Intel. There’s no doubt that digital transformation is changing the way we work and under the guidance of our CEO, Brian Krzanich, we are accelerating our own evolution (or digital transformation) from a PC-based company to an enterprise powering digital convergence with the applications, tools and platforms businesses need to compete in the digital economy of the future. It’s a strategy that builds on our experience and strengths to support and power the cloud, workplace of the future, and the smart, connected devices at the heart of the Internet of Things.
I admit, it’s not easy to go through a dramatic change in your business, but I believe you absolutely must transform as an enterprise to stay relevant.
It’s imperative someone in the corporate boardrooms is looking out the front windshield at where the organization should be going and have some insight or foresight to bake that vision into the strategy and then, and this is very important, put that strategy into action.