Daunting, isn’t it? The continuous market uncertainties, accelerated pace of innovation, and intensity of competitive threats that we now face on a daily basis have given us even more to think about than just our current health crisis. So, what does this do to the direction that modern-day enterprises are heading in?
In this new series of articles, I’ll be addressing the need for a fresh perspective, and exposing the dynamics of the market context that enterprises will encounter. I’ll also be looking at the operating paradigm for competitive differentiation, superior performance, and mid- and long-term survival. I hope you find the series as useful as I intend it to be.
Are you fit for tomorrow?
The COVID-19 health crisis has underscored both the frailty of today’s enterprise and the inescapable need for agility, speed, and proficiency to adapt in ways, heretofore, never seen. The terms “enterprise readiness” and “fit for tomorrow” have taken on new meaning and, more importantly, created an urgency that demands more adaptable mindsets, business models, interventions, solutions, and competencies.
If enterprises have not gotten the message yet, it is time to take note that disruption of every kind is not a question of if, but rather when and with what survival rate. This is not evolutionary change requiring incrementalism as a response: we are witnessing revolutionary-grade disruption requiring fundamental business discontinuities.
However, not everyone is on board with the idea of a seismic shift – and we are already seeing three types of entities emerging from the dust cloud created by the health crisis:
- Firstly, those who have rebounded, recovered, and restarted – but are treating business as usual. These companies are stalled, and they will no doubt find themselves in a difficult place by ignoring the concept of change.
- Secondly, those who are attempting to renew but have been left in a vulnerable position. These companies know how to change, but the question is how to achieve it while attempting to meet short-term KPIs – and do they have the leadership to break through?
- Thirdly, those who are committed and well-positioned. They “get” digital and know they have to change. These are what I call the “renaissance” companies, which is a concept I’ll explore later in this article.
Reassessing the necessity of our “must haves”
Automation everywhere. Migration of systems to the cloud. Implementation of new business software solutions and functionalities … Wait. Save your money. Resist the temptation. Like carnival barkers, solutions providers bombard us with intense marketing of the next wave of killer apps, shiny objects, and must-have technology-based products, services, and offers.
Not to argue their relevance, but we need to move past the silo thinking. Addressing our customers is not solely a function of the next CRM solution, the supply chain of the next ERP, the speed and agility of process automation, or the executive decision making via analytics and AI. You only have to look to the recent past to see the investments, careers, and businesses scuttled by the ROIs associated with major technology-based investments that have fallen far below expectations.
What’s more, if we all respond to the temptations of what will surely be promoted as the must haves for recovering our enterprises post COVID-19 – preparing for continuous change, and making us more responsible and purpose-driven entities – competitive parity will be the best we can hope for. And that assumes we actually mobilize and execute well.
Consider the following from Gartner, offered in 2019: “In two years, process automation will have limited impact on top-line growth for 50% of organizations that will erroneously focus on labor reduction, not on improving business outcomes.” Furthermore: “CEOs recognize the need for growth through innovation. In fact, 93% of CEOs see innovation as the primary driver of their revenue over the next five years. And yet, only 27% of the CEOs believe their organizations will be able to deliver it.”
As you can see, it’s perhaps best to resist the miracle cure.
There’s gold to be found if you adopt the right perspective
It’s time, once and for all, to think about the future of our enterprises through a different lens. A lens that takes certain stock of the demands of constant change, global competition, new market entrants, powerful technologies, persistent and intolerant stakeholders, and environmental and social pressures. But a lens that also recognizes that nearly all of today’s enterprises were designed and built for a far different set of market realities than those we currently face. Simply signing up for more of the latest market offers and dropping them into our enterprises will be nothing short of a fool’s errand – likely leading to disappointment, unrealized ROI, and little to no appreciable impact on business performance.
I’m reminded of the great California Gold Rush of the mid- to late-1800s. As with any good gold rush, everyone brought a pick, an ax, and a pan. The differences between these tools were marginal at best. Innovations were pursued and released, and those with a degree of financial advantage had access to better equipment. But there was little competitive advantage gained by the miners. And the select few who made fortunes did so in spite of this parity while most miners returned home as poor as they arrived.
But there was another story that emerged from this period. It wasn’t about the next-best tool to put in the miners’ hands, rather it was the introduction of a platform that allowed the miners to endure the tough physical conditions of mining and the ability to afford to mine over the long term. This platform was the miner’s apparel, better known as the riveted waist overall – or more popularly, the denim blue jean introduced and scaled by Levi Strauss & Co.
“While everyone was busy running up and down to have access to the gold, Mr. Strauss decided to overlook the idea and capitalize on the thousands of hopeful miners by providing them with a durable garment that could stand up to the harsh conditions of the goldfields.” One hundred and thirty years later, we still witness the relevance and durability of this platform. In this simple example, we see regard for market positioning and a platform that can adapt and evolve over time.
Reimagining our enterprises
When we consider the landscape in which enterprises now find themselves – and will continue to confront across near-, mid-, and long-term time horizons – what emanated from the US Army War College to describe the post-cold war world remains quite appropriate and applicable. Volatility, uncertainty, complexity, and ambiguity – or VUCA.
A VUCA market landscape and operating paradigm requires more than a response, more than a recovery, more than a rebound, more than a relaunch, and more than a resurgence. Something down to the core of the enterprise, fundamental to its foundation, and challenging to its raison d’etre is necessary.
So, let’s do something we rarely have time to even add to our to-do lists – let’s reimagine our enterprise. Because in the current climate of today, and with a pandemic rocking the economic pillars of our globally connected world down to the most basics of human and consumer behaviors, this is not the time for just any response.
True, reacting rapidly may provide temporary relief and perhaps short-term accomplishment. But if we accept that what lies ahead can’t be fully predicted and will remain in a constant state of change –some evolutionary and some highly disruptive – then we can prepare for continuous VUCA. And when this VUCA landscape is global, impacts the entirety of an enterprise’s operating paradigm simultaneously, and can demand a portfolio of actions that may not presently be in hand, something more than what has worked or been tried previously is necessary.
It’s time for renewal and renaissance
More than just catchy words, now is the time for the fundamental renewal and renaissance of the modern-day enterprise as we know it. Anything less will be tantamount to watching the shot clock descend to zero.
Contributing writer in Forbes, March 2020, Robert C. Wolcott wrote: “The current state crisis should eliminate any uncertainty about the wisdom and urgency of fundamental digital transformation …This crisis is a truly global, human tragedy, and the extent of our shared trauma has yet to materialize. As business leaders, we must act boldly in the immediate term to serve and protect all of our stakeholders while simultaneously considering long-term implications … With the longer term in mind, this is the best opportunity since the global financial crisis of 2008 for incumbent businesses to overcome death by incrementalism and make the case for company-wide digital revolution.”
With this in mind, let’s take Oxford’s definition of “renewal”: “the replacing or repair of something that is worn-out, run-down, or broken” and of “renaissance”: “a revival or renewed interest in something,” derived from the French words for “back, again, and birth”. And let’s understand the message. We are facing a reality that requires a fundamentally different grade and scale of response. An attitude, mindset, commitment, and a take-no-prisoners approach that goes far beyond our attempts and abilities to meet typical market challenges.
Renewing the modern-day enterprise and creating a broad renaissance comparable to what is suggested here has perhaps occurred only a few times in recent memory. But the renewal and renaissance necessary today will be fueled by three very similar drivers that I’ll be exploring in the rest of this series of blog articles: Position; Platform; and Proficiencies.
So, join me in my next article as we look at the importance of Position – and gaining an intimate understanding of the strategic context in which enterprises are about to embark.
Assess your business readiness and capabilities using our Applied Innovation Enterprise Proficiency Assessment tool.
Read the complete blog series on ‘Beyond the health crisis’ by Lanny Cohen here.
Join us in our webinar on the 8th of October to discover 3 ambitious measures—Position, Platform, and Proficiencies—and the related training plan for you to evaluate the innovation baseline for your enterprise here.