Wednesday, November 13, 2013

Leadership Versus Adaptation

Discussions of external threats often devolve into a discussion of likely trends that will impact the current operations of a business, industry or nation.  These trends, which impact economic growth and prosperity, are the consequence of a series of forces that have pushed for change.  At the inception of each trend, an individual identifies a need and takes action to make it a reality.  As Martin Luther King, Jr. once said, “Change does not roll in on the wheels of inevitability, but comes through continuous struggle.”  Businesses, industries and nations struggling to adapt are forced to react to opportunities that have already been exploited by other more progressive organizations.

In, Going from Global Trends to Corporate Strategy, the suggestion is made that adaptation to external trends can improve profitability.[1]  While this may be true, in recent years the pace of innovation in some industries has eclipsed the ability of some organizations to adapt.  In these industries adaptation was not enough.  Amazon.com’s kindle devastated the printed book market, Apple’s iTunes transformed the music industry and Netflix replaced the local video store.  These organizations identified an opportunity, took action and cultivated a trend.  These innovators took market share while their industry’s dominant players sought to protect the status quo.  In the bookselling industry Barnes and Noble escaped bankruptcy by quickly introducing the Nook, but many other booksellers like Borders did not survive.   

Identifying and reacting to external threats may not be enough.  What may be more important is to identify potential opportunities.  Five potential opportunities discussed in What Happens Next involve changing macroeconomic dynamics.[2]  Increased growth in emerging markets, need for capital productivity growth, increased connectivity and market volatility, increased resource consumption and scarcity and the need for governments to become more involved in promoting growth.  Each trend reflects a dynamically changing environment that will reward innovative leadership and penalize complacency and protectionism.  Looking for opportunity and leading change may be a more effective strategy than a reactionary approach based on adaptation.     

In, How to Lead Change: 3 Simple Steps, Mike Mynatt suggests that those organizations that are unwilling to embrace change will also be unable to lead it.[3]  According to Mynatt, leading change requires (1) Identifying the Need for Change, (2) Leading Change and (3) Managing Change.  In order to manage change, key leaders must be able to leverage supporters and neutralize detractors, be given the responsibility to enact change, maintain clear objectives and be held accountable and finally be given the authority to get the job done.   

The attempt to mitigate the impact of an external threat indicates an initial ignorance of the factors impacting a market, an inability to lead needed change or an unwillingness to change.  In an increasingly transformational world, organizations will need to move beyond just identifying and adapting to changing trends.  By the time a trend is identified, it may be too late for a company to adapt.  Increasingly, companies will need to lead change, and in so doing will need to encourage and develop transformational leaders within their ranks.  As George Bernard Shaw once said, “Progress is impossible without change, and those who cannot change their minds cannot change anything.”  



[1] Becker et al. N.p.. Web. 13 Nov 2013. <http://osmangok.yasar.edu.tr/ULTF 501 ULUSLARARASI PAZARLAMA YÖNETİMİ/SUNUM MAKALELERİ ÖRNEKLER/From global trends to strategy.pdf>.
[2] Bisson et al. N.p.. Web. 13 Nov 2013. <http://www.bdc.ca/EN/about/legislative_review/Documents/Five Crucibles.pdf>.
[3] Myatt, M. n.d. n. page. <http://www.forbes.com/sites/mikemyatt/2012/02/07/how-to-lead-change-3-simple-steps/>.

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