Constant Change is the only Certainty

Constant Change is the only Certainty

July 29th, 2015 // 7:23 pm @

Change300Every business is constantly in a state of change.

Those who embrace that reality, focus and drive it to where they want to go will succeed. Those who believe the business is fine as it is, are likely to be overwhelmed by the inevitable change as it happens.

It is fashionable to believe that in the past businesses were not in constant change, when in fact they were. What has changed is the speed of change, since the mid 1800’s the speed of change has taken off and has accelerated every year and that acceleration will continue.

This provides an interesting managerial challenge, in how to drive successful change within your company to shareholder advantage in a fast moving world.

Firstly the company must decide how to add shareholder value, to increase volume? to increase market share?, to develop world-leading products?, or deliver short-term dividends? There are in fact many different ways to add shareholder value, and as of today some highly valued companies are yet to sell one product, and some who have never made a profit but are highly valued.

From a clear strategy of how to add shareholder value should come the understanding of which key drivers in the company will deliver those strategic goals. Understanding how the company works, it’s Business Model and how each part fits together allows good management to focus resources where they are required to drive success, and to change how the business fits together if appropriate.

Most business change fails, not because the vision was wrong or even the understanding of the business model was incorrect. Change fails through lack of leadership.

A good leader will work with the people within the business to develop a clear business strategy, but then they have to make it come alive throughout the company.

A good leader is constantly selling and explaining the vision within the company. If people understand and can buy into the vision, then the thousand little decisions made within any company every day that the CEO does not even know about are likely to be inline with the overall vision.

If you want to understand how well lead a company is ask various people at different levels what the company is trying to achieve. Hopefully you will get a consistent answer, inline with the companies plan. Sadly such common direction is rare.

The common direction can be significantly improved by structuring the company in line with ones goals. The use of structure is an underused managerial tool. Structure gives focus to people, and the reality is most people focus best on one thing and if the business structure gives them that focus they will find it easier to be successful.

This works even at a top end business level, few businesses are successful when trying to do two things, they are often better split into separate divisions or even separate companies. For example Paypal and Ebay are trying to do very different things in very fast changing markets, their separation into two businesses is likely to make them both more successful as it will allow clear focus on their two markets.

Vision is wonderful, but it must be turned into something very real and fiscal. Where one invests, the fiscal targets one set’s must all be inline with where the company wants to go. Budgeting based on last year plus some percentage will never drive real change. If you want real change start with your vision and a blank piece of paper, and question every line.

Every successful company has great people, giving them a clear vision, a focused structure and appropriate investment will bring out the best in them, but you need to hire and retain the best.

Great people with a common goal, and the correct support will climb mountains for you if you give them a chance.

It is a reality however that most change instigated in business fails. One key reason behind this is fear. Continuing doing what we did last year feels safe, we know we can do it, we did it last year. Being asked to do something new is scary as we might fail.

This fear of change can be anywhere in the company from the CEO down. It takes a degree of courage to drive change and all good leaders have that courage.

The real danger is not to embrace change, those companies that cannot do it end up making the worlds best “Floppy discs” in a world of “Cloud Computing”.

Adapt or die.









Category : Blog &Key Business Success Drivers &Leadership

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