Is your business at the doorstep of possibly becoming obsolete?
If you don’t ask yourself this question on a regular basis, then you’re failing to understand how the current pace of change in the contemporary world can shorten the shelf life of a product and/or service – even one that appears otherwise viable for a long time to come.
Here today and gone tomorrow has become astonishingly commonplace. Indeed, the landscape is littered with untold examples.
When was the last time you backed up computer files on a floppy disk or cd? Used a VHS tape? Got film developed? Bought a vinyl record? Connected to the internet with a dial-up modem? Or acquired a car with an audio cassette player built into the dash?
You get the idea.
For close to probably 99% of all businesses, the answer about being potentially derailed by obsolescence is not just a yes…but an emphatically affirmative one!
Part of your job entails staving off the ugly consequence of having it take you by surprise.
guarding against a ruinous outcome
You can’t stop things from becoming obsolete, but you can guard against it turning into something that will exact a terrible toll.
In fact you should always be on the lookout, across the entire value chain, for everything and anything with the potential to excite an appreciable shift from business-as-usual. This kind of vigilance is the first key to being properly prepared for what lies ahead.
It includes knowing your industry intimately well and staying abreast of what’s going on with it. Keep monitoring the various aspects of it, things like current and emerging competitors, consumer tastes and behavior patterns, technology trends and, for that matter, anything else that should be kept under the cast of a watchful eye.
Even if something appears seemingly inconsequential or small at the outset, keep tabs on it nonetheless. Allowing little things to fly under the radar can often end up posing the biggest danger of all.
Draft a list of the items you’ve observed and write descriptive notes about each to give it a meaningful context. Is it an invention of something radically new or an innovative addition to something already being done? How might it change the game – will it likely be evolutionary in nature or revolutionary? What is its level of maturation? What’s the adoption rate look like? Is it just a possible fad or a genuine trend?
Maintaining this kind of list will not only provide an ongoing reference for properly tracking these things over time, but it will also help with evaluating its development and, more importantly, significance to your business.
Probably few examples better exemplify the importance of actively keeping this up than does the video rental industry, given how quickly and drastically its complexion has changed in recent history. Had Blockbuster Video done a better job of heeding this advice it might be in a stronger position today.
This brings us to a second key for proper preparation, and it coincides with the first: know your own organizational culture intimately well.
An organizational culture is comprised of its psychology, experiences, beliefs and values. For example, how well does it tolerate risk – does it tend toward conservative or aggressive? How well does it embrace change? How quickly can it be mobilized to effect a change when needed?
The influence of an organization’s culture will have just as much bearing on its ability to avoid being victimized by obsolescence as do the external factors.
For example, it’s conceivable Blockbuster’s slow response to the competitive actions of Redbox and Netflix was due more to a plodding organizational culture than a lack of faithfully tracking the industry. Because of it, they may have hesitated to make the changes they’re now forced to make, as opposed to being more proactive and moving sooner.
After sizing up these two facets of your business, it’s time to consider the adoption of a strategy that will prevent you from being ill-prepared as these eventualities arise.
In Part 2, we’ll explore four potential strategies to choose from, and how you might choose the one(s) that best matches up with your particular circumstance.