Achieving Business Agility – Part 1 of a Three-part Series
Part 1: Sound the Alert:
Today, companies are competing on a whole new playing field. Customer demands are changing too fast for most companies to keep up. As the world becomes more digital, traditional companies are being disrupted and are rapidly losing market share to more agile competitors. Modern companies need to rethink how they will adjust in order to survive. In today’s competitive landscape, speed matters. If companies cannot respond quickly—with more agility—they will be left behind.
When leadership lacks the awareness of the challenges from competitive entry, it’s time to sound the alarm and create a sense of urgency to pay attention to this problem.
The reality is that your company’s executives are always busy, and, in some cases, they feel as though everything is going just fine. They may be thinking, “I’ve been successful thus far, so I must be doing things right. I am constantly getting requests from people wanting something. Why should I spend time dealing with yet another person asking me to do something when I already have too much work to do?”
A sound the alert strategy will get an executive’s attention by alerting him or her to an imminent company problem and creates a sense of urgency to address it. This strategy is based on getting executive attention by pointing out the ramifications of an emerging business problem: new competitors are winning over your customers and are poised to take the lead.
In the past, when opportunities appeared in the market, the leading firms would simply exert their brute force and gobble up the competition. As we’ve seen with Quaker Oat’s purchase of Snapple or eBay’s purchase of SKYPE, what remains is a strategy that still needs to get executed. As for business agility, today is also different. Digital disruptors are everywhere, and they quickly respond by attacking a single aspect of or weakness in your company’s product and improving upon it to create their own solution. Once this competitive solution succeeds with customers, your company has missed a key opportunity.
Although organizations have been changing for years, the current pace of change has accelerated with disruptor entry, and organizations no longer have the luxury of procrastination or resting on their laurels.
A recent study by Innosight, “Corporate Longevity: Turbulence Ahead for Large Organizations,” illustrates how Fortune 500 companies are being disrupted by smaller, more agile companies.1 The findings warn business executives that about half of the S&P 500 will be replaced over the next 10 years. Some notable companies that have already been dropped from the S&P 500 over the last six years are Kodak, Sprint, Abercrombie & Fitch, JCPenney, RadioShack, Dell, Avon, The New York Times, and Safeway.
If your company executives have the same naive lack of awareness, you may be on your way to a similar fate. If you can’t keep up, the digital disruptors will move on to attack the next part of your company’s blind spot in the market.