6 Ideas For Competing In a different way In Uncertainty
Many of us read more than usual these days – perhaps one of the few positive aspects of the COVID crisis. For business readers looking for inspiration on what’s coming after COVID to make the big restart for their business possible, there are two recommendations.
First, consider The Upside of Turbulence by Donald Sull, now at MIT and previously at London Business School when this work was published in 2009. The book was written with the financial crisis in mind, but the thinking carries over completely to our current times. Sull is a great storyteller, and his detailed examples come from contemporary triumphs – like Lakshmi Mittal’s forge of the world’s largest steel company from the turbulent worlds of India and the crumbling Soviet empire. At the same time, however, he provides deeply researched historical examples, such as how Harvey Firestone turned the massive throng of tire manufacturers battling for their share of the chaotic early years of the automobile into huge business.
The Upside of Turbulence contains at least three important lessons for the COVID era:
- Companies often exhibit in the face of the crisis “Active indolence.” This phenomenon affects companies that carry out an enormous amount of activity, but are all in the service of older business models and mental maps, rather than redesigning an industry. Companies that are able to break out of these ranks and compete differently end up creating wealth while others become irrelevant.
- Find an opportunity, not just a threat. Quoting the research of my former consultancy colleague Clark Gilbert during his class at Harvard Business School, Sull shows that companies faced with identical change thrive at much higher percentages when they change the landscape in terms of opportunity rather than just potential downside shape. It is remarkable to see how much the final results depend on how companies see the challenge in the first place.
- The golden chance follows death threats. In Industry by Industry, Sull shows how winners like Carnival Cruises pounced when similar companies like Royal Caribbean held back. He understands that the answer often does not lead irrevocably to massive investments in the midst of the crisis, but he shows that bold action can come in many forms.
Overall, Sull’s advice is well founded and forward-looking for our time. Indeed, we should take these words to heart: “Unexpected changes are not bugs in the world’s operating system. You are a feature. “
In a completely different sense, Vijay Govindarajan from Dartmouth and his co-author Manish Tangri from Intel wrote the Three Box Solution Playbook. VG, as it is called, is famous for breaking down well-founded company advice into easily digestible and disseminable stories and frameworks. His approach to business innovation is based on an analogy of three fields:
Box 1 – Manage the present. For the vast majority of business, the priority must be the core business that should be managed as the performance engine. The teams dedicated to this task are typically different from those who build new growth businesses.
Box 2 – Selectively forget the past. This is a tough challenge for many companies, but it’s important to maintain agility and be ready for adjustments. This lesson is especially true with COVID as companies try to reboot their business models altogether with new cost structures, new forms of customer experience and retention, and sometimes new value propositions.
Box 3 – Creating the future. It is this box that receives by far the most attention in VG’s new book and that is particularly relevant today. VG walks the reader through detailed case studies of how the New York Times built their resilient digital business.
The book offers a wealth of tools, worksheets, and templates to guide a manager through a structured process from strategy to brainstorming to prioritization and execution. For readers, the structured approach of borrowing from core business (Box 2) and testing critical assumptions and experimentation for newer companies (Box 3) may be particularly useful. While managers often have an intuitive understanding of the need to restart their business in the face of the COVID crisis, they can struggle with the how, and VG’s playbook offers a step-by-step approach to getting there.
The strongest business literature feels absolutely up-to-date and yet has a timeless quality that enables it to endure. These two books reach this bar.
Contribution to Branding Strategy Insider by Steve Wunker, author of JOBS TO BE DONE: A Roadmap for Customer-Oriented Innovation and Charlotte Desprat and Jennifer Luo Law.
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