This post is adapted from an earlier article by Victor Lipman on Forbes.com
With a single cataclysmic event, the dinosaurs that walked the earth for many millions of years were extinct, relegated to museums and memory.
The complete extinction of the dinosaurs was largely the result of their failure to adapt and evolve. This is a powerful lesson for business. John McCallum, professor of finance at the I.H. Asper School of Business has made the observation that like a dinosaur, a business is a living organism. Both businesses and biological organisms are made up of many parts that have to work together. One non-functioning piece can bring down the whole enterprise. In order to prevent extinction, companies must evolve, as enterprises that fail to adapt might wind up as little more than a cautionary tale.
Adapt or Die
Though this might sound dramatic, it has never been truer. The accelerated pace of the digital age has made flexibility imperative, and heightened the need to stay ahead of the competition. Many enterprises are one innovation away from obsolescence. Without quick adaptation, today’s soaring eagle can be tomorrow’s fossil.
Most people resist change at all costs, and yet change is necessary to success. The chameleon, a lizard like the Tyrannosaurus Rex has survived because of its ability to adapt to its surroundings. It is the failure to adapt both on the managerial and the employee level that leads the statistic that 78% of IT managers feel that the business stakeholders need to be more proactive and clearer communicators. Adaptation and change should be an ongoing project and if done correctly can build great teamwork.
Size Matters, but Not if it is a Burden
The price of scale should not be slowness. We have all whiled away the time staring at the clock in unproductive meetings, waiting on management, and trying to slog through layers of irrelevant material. Size is great, but it should never hinder action. Streamlining is important.
Keep an Eye out for Meteors
Events that seem localized can cause cataclysmic changes in the larger environment. Stay aware of what is going on in your industry so that you can adapt proactively rather than scrambling to do damage control.
In a hyper-fast business world, risk is magnified, and the demands of the customer are always increasing. It is wise to analyze the prospects of the change initiative before jumping into the deep end. One way risk can be managed is by running a companywide diagnostic that will examine the status of other current company initiatives. Once you gauge the success of these initiatives you will be able to tell what works and what does not as you move forward with your change initiative. Success will go to those who can assess risk and respond with speed and agility. The ability to perceive risk and deeply understand customer needs will leave you well-positioned for success.
Ethics and Governance Matter
Rapid change exposes dubious ethics and poor governance. Build your enterprise on an ethical and well run foundation, or you will find cracks forming with the first rumblings of change.
Good Leadership is Imperative to Managing Risk
An executive recently observed that “You can’t control people through policies, procedures, and policing. You can only do it though strong risk management culture and absolute integrity in all leaders.” Adaptation, change, risk management, and integrity are intertwined. In order to motivate change, leaders must behave in a trustworthy and ethical manner. It is worth noting that no one wants to follow a leader that they do not trust.
Watch for (and Deal With) Executive Burnout
Part of managing risk and adapting to change is keeping good energy and focus in the executive suite. Tired, cynical, and stubborn executives can do massive damage to the corporate culture in a very short time. Symptoms of executive burnout include defensiveness, bitterness, irritability, inflexibility, listlessness, boredom, procrastination, and fatigue. If your executives resemble a pack of lumbering triceratops, it might be time for an overhaul.
In the current economic climate, change is rapid. We are living though a digital revolution that is not unlike the industrial revolution of the nineteenth century. Change is just as imperative now as it was then, and those who adapt will survive.
Philips Electronics was founded in 1891 and learned to change and adapt in a world of electronics that is moving at the speed of light, as very nicely illustrated in their wonderfully creative video “How many years does it take to change a light bulb?”. Philips avoided extinction through adaptation and responding to consumer needs, in one of the toughest industries in the history of the world “consumer electronics”. Any company who wishes to survive the digital and information revolution must develop the skill and mindset to quickly and effectively adapt to change.
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