As we’ve all no doubt experienced, opportunities born of changes to consumer habits, technologies, and other trends, do not follow a specific linear path. Yet, for as much buzz as there has been about the word “disruption” over the last decade, it’s interesting that for many of us, as we see the world changing, and our own business models being disrupted, we retreat our own linear strategies to defend against the changing world. Business has never really been linear. So why do we stick to linear strategies in our own businesses?
One reason for this is that predictability is key to strategy. For established businesses, maybe like the one you work for, we often use existing data about existing products and services to project some future performance. We look at what we know to be true through the lens of spreadsheet projections based on estimated percentages of growth, among other things. We retreat to what we know and can track. This process is all about utilizing quantifiable analytics to predict the future that is more or less an optimistic version of what exists today.
In a word, we tell ourselves the world is linear. Thus, we develop linear strategies, complete with detailed presentations and spreadsheets, that suggest that our primary job is to execute. After all, that’s what our performance is measured on, isn’t it? In reality, constant change is the only thing constant in business. And, it’s our uncertainty about change that forces us to take what we believe to be the safer, more comfortable linear path. That said what if we told you that there existed a process that empowered you to harness change in order to address the opportunities (and challenges) that change brings to business? What if we told you a process exists to create market-changing disruptions?
Businesses, especially non-startup businesses, are all about execution of the strategy. After all, the way most companies scale and grow is through the execution of their specific strategy. Execution – when it comes to producing, marketing and selling products and services – by its very definition is linear. Execution follows an orderly and detailed plan to produce something over and over again with the ultimate goal of being able to profit through quantities of scale. And, according to Steve Blank, a Silicon Valley visionary, serial entrepreneur, and educator, “the more granularity you add to a plan, the better people can execute it.”
IF CHANGE WERE LINEAR
For many early stage and smaller companies, the path to scale often ends up with an ambitious line of exponential growth, accompanied by tantalizing stories of certain success – which is based on a promised path to execution. In reality, however, what we see in hindsight is that the strategies we execute almost never take a linear path. As mentioned above, this is because change, and especially change in the business world, is also not linear. If change were linear we would have more taxis rather than Uber. If change were linear Kodak would rule the world of photography and the Blackberry T25X would be in everyone’s pockets.
On the other side of the coin is “search”. Whereas businesses that have successfully developed profitable and scalable business models typically execute those in a linear fashion, startups, on the other hand, are entities that are in search of a profitable, scalable business model to execute on. Most companies start out their lives as startups in search mode. But, few companies continue in search mode after they’ve found their winning business model (for today).
Of course, execution is absolutely essential for any (and every) business. Execution enables businesses to manage and measure progress on a regular basis. But, what is missed when only progress along a set of linear axes is measured, are the unforeseen changes that may affect progress. And, there is no business on earth that is not affected in some way by unforeseen change. In fact, some of the biggest, oldest, and most successful businesses in existence, banks, have gone through such rocky period in the last decade, that some of the largest are no longer around.
SEARCH + EXECUTE
To mitigate the negative effects of change to your company’s business model and strategy – while also harnessing that change for the good of your business – you must learn to simultaneously search and execute. In some businesses this takes the form of applied research, as you’ll see in a later example; and we’re not talking about R&D here. In other businesses, search permeates throughout the culture and change happens everywhere. What’s important is not that one of these is better than the other. More accurately, it’s that as long as your company is always and continuously searching, with eyes wide open, it will be more informed and able to act on unforeseen changes that may challenge its strategy. Better yet, it may be able to capitalize on changes to create unforeseen opportunities for the future. Hence, search is about executing on the current business model to create, deliver and exchange value with your customers while you also keep your ear to the ground and explore new strategic options for the future in continuous cycle. Search is ultimately learning, adapting, and perhaps disrupting, as you continue to execute.
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