My former company and I are guilty of starting our presentations with the assertion that the world is going through an accelerated pace of change. We point out obvious things i.e. how technology is getting more advanced every day, how the world is increasingly connected, how the marketplace is increasingly global and competitive, how we are facing unpredictability in political and climate change. And that usually leads off to how we can get our clients out of this mess. The strategies are not always the same, but in this Internet age, popular business magazines and websites are turning to catchy one-word solutions. Pivot. Reiterate. Be as fast as the change that’s going to sweep you away in a tide of irrelevance.
HBR recently ran a post poo-poohing the notion of business survival as simply having the ability to transform on a dime. The computer mouse was invented in 1965, but became the standard tool only with the launch of Macintosh in 1984, and even then it only gained popularity with mass users in 1995, with the launch of Windows 95. That’s a 30 year gap.
Amazon, after 20 years, has 50% market share of all books sold online (ebooks and print books combined), and with online commerce comprising 44% of the US book market, this gives it a 22% of total market share, which is just slightly higher than that of Barnes and Noble.
To be sure, first mover advantages can vaporize quickly, but not all first mover advantages are backed by a real competitive advantage. So if I hear the demise of MySpace cited once more as evidence that competitive advantage has become more transient, I will puke. All it proves is the basic rule of business: that which can be built simply and quickly can be simply and quickly torn down.
One thing that people often confuse is technology and strategy. The answer to change is not putting the business on a nicer, mobile optimized website.
Strategy is a balancing act; it’s about judging between a fate being sealed and its being realized. Companies should not be in a hurry to abandon their competitive advantages in the wake of the hot new idea or technology. They must pay it attention because it may contain the seeds of their eventual destruction. But there is probably (plenty of) time to figure out what to do.
Read the article here.