PERFORM OR PERISH – A brief about changing business environment and decision making.
An object continues to remain in its state of rest or of uniform motion unless acted upon by an external unbalanced force. The mentioned statement, though not verbatim but statesNewton’s first law of motion as known to all of us. Absolutely applicable to everything in the universe could it also be true for business organizations? Is it possible that business units too need to change from their state of rest or uniform motion when acted upon by an external force? The answer in the context of modern day industry dynamics is most definitely a YES!
Change is the only constant.
The age old adage is as true for business as we know it as it is for anything else. Any modern business or industry as we see it today is a product of decades of evolution which can be seen as both a cause and an effect of the changing dynamics and how these organizations respond to these changes makes the ‘Darwinian principle’ of survival of the fittest applicable to these organizations.
This information exchange has not only speed tracked business processes but completely transformed our understanding of how business function in the larger scheme of things.
During research for this article, I had multiple conversations with people right form small start-ups to conventional business having survived the test of time, one glaring fact that surfaced prominently was the paradigm shift in our perception of the drivers of economic growth. Not too long ago we were talking about fields such as 1) Infrastructure, 2)Telecom, 3)Manufacturing, 4) Retail, etc. In the recent past these contributors may not be as fortunate to find a place in our list of top 4, we are more inclined to mention factors such as 1) Social Media, 2) I.T and I.T.E.S 3) Ecommerce and E-tail, 4)Education and Healthcare. Few of these mostly unheard of not too long ago. That brings us to the question of what exactly has changed. Businesses have been evolving for as long as our understanding of the concept of business itself, why is it that only now it has reached a point where the change not only augments but completely disrupts and revolutionizes the segment that it comes in contact with. The answer to that question lies in the question itself. Most smart phones in the market right now have more computing power than what was available for the entire Apollo Mission, as absurd as it may sound it is completely true, the engine of growth is fuelled with such capacity in the modern day that businesses have changed more in the last 20 years itself than in over 50 years preceding that put together.
We are seeing more and more number of billionaires being produced by the world and just as many organizations going out of business for not being able to keep up pace with the industry. That brings me back to my original point of the ‘Darwinian principle’ of perform or perish being applicable to businesses now more than ever.
One reality of modern day business is uncertainty, based on the speed at which the business may be affected by this uncertainty brings us to the question of how proactive or reactive organizations need to be in their strategy decisions, decision making in general has reached supersonic speeds due to the availability of information and intelligence. All threats pose more of an opportunity now more than ever, just needing an initiative from these businesses to make the most of them, a reactive approach under these circumstances not only opens the markets to other players racing to compete for market share but also leaves the business vulnerable to redundancy in terms of keeping up to pace with the overall industry.
It would be safe to say that businesses today need to be more on their toes and flexible to change now more than ever, gone are the days when organizations could afford to stick to their strategies and incorporate minor changes basis their competitors actions, examples are plenty of organizations that enjoyed a lion’s share of the market only to lose it to competition in the face of changing industry dynamics and their inability to take appropriate action on time, we have been a part of the generation that witnessed companies like Nokia and Motorola not only introduce constant innovation but at a period enjoy a market share more than most of their competitors put together, losing all of it due to their inertia in incorporating change, all of it in a period of less than 10 years. This brings us to an important question, how much do organizations need to change and how quickly, honestly there is no standard answer to it but one thing that’s for sure is that organizations today need to beyond just accept change, they almost need to anticipate change and ensure a certain amount of flexibility in all their strategies, infact, the organizations that have performed the best in the last 10 years or so are the ones have not only accepted but almost always initiated change.
To take an example, we can look at Facebook. A company that primarily started into Ivy League social media, expanding into a mass social media platform enabling content sharing, to a full-fledged technology and innovation company (owing to acquisition of oculus rift and others) going into avenues unheard of with “free-basics”, a company that not only stands as a billion dollar empire right now but lined up to be much more than just that in the foreseeable future owing just to proactive decision making. Doing all this in just the last 10+ years while taking some really big businesses out of business in the process and successfully catering to their market.
Proactive decision making and willingness to change their approach towards business strategy decisions is enabling businesses today to not only have the option to evolve but also to lead an evolution and increasing the horizons of businesses as we know it in every step they take. All this is evident from how Facebook has approached its business over the years.
Businesses have always been “changing with the changing environment”, this reactive approach that has served its purpose to most businesses over the years has definitely taken a back seat in the context of the current scenario, a company can no longer afford to wait for their competitor to introduce an innovation and take action accordingly to save their market share, the time from introduction of an innovation to capturing market has reduced substantially forcing major players to take notice of not only their immediate competitors but also any and all new players entering the market with the threat they propose to completely revolutionize the industry is not being taken lightly. Same is evident from companies like Godrej entering into the online space with efforts like “big basket” to ensure safeguarding its market from much smaller players throwing much larger challenges in the market than most established players.
To sum up the entire article, its best said by some people who not only understand this phenomenon but have left a global imprint by employing this understanding to their everyday effort.
In a world that changing really quickly, the only strategy that is guaranteed to fail is not taking risks” – Mark Zuckerberg.
“This is a fantastic time to be entering the business world, because business is going to change more in the next 10 years than it has in the last 50” – Bill Gates.
“Willingness to change is a strength, even if it means plunging part of the company into total confusion for a while” –Jack Welch.
For quotes mentioned: refer Goodreads.com, brainyquotes.com, google, etc.