Ready, Steady, Change!
To be change-averse in current times is seen as a hindrance to progress. We are constantly encouraged to embrace the new, to adapt and to engage with emerging technologies, to choose faster ways of doing business and communicating. It’s an attitude that appears in every part of our lives – from the latest thinking on weight loss to the latest way to educate our children. Let’s scrap the diesel engine and switch to a hybrid. Let’s abandon our vinyl collections, then abandon our CDs and stream. If you don’t change, you’re branded a dinosaur and you’re going to go extinct.
The odds of failure
The pressure is on, but that doesn’t stop people being change-averse, and there are some very good reasons why it makes sense to adopt a cautious approach. Frost and Sullivan is a leading US-based market research business. They’ve published figures that are sobering:
Only 1 in 100 new products recoups its development costs
Over half of all new products fall short of the company’s expectations at launch
Only 1 in 300 new products either changes customer behaviour, their product sector or their company’s growth. This means that all those wonderful new ideas we’re working with sit atop a whole heap of failed initiatives and products that never gained a foothold. That’s not to say the failures were without merit. Many of us remember the race for supremacy in the home video recorder market. Betamax is still widely regarded as the better product, but it was VHS that won the battle.
When to change
Change is always going to incur an element of risk but doing nothing isn’t an option. If you want to make progress you need to disrupt the tried and tested and work towards something new. It’s essential to have a growth mindset and part of that is realising that failures and mistakes are a learning opportunity. Yes, they can be costly, but nowhere near as costly as letting a business go under as the market moves on.
Knowing when to change isn’t easy. Professional athletes often take time out after a major championship to focus on changing an element of their technique or recovery strategy so that they’re in great shape coming into the next big event, but businesses rarely have the luxury of a fixed calendar and a ready audience. For example, there might be a trade event where you plan to launch a product. You might be ready, but the market isn’t. Consumers aren’t willing to buy yet – or at least not in the volumes you’d hoped.
A time for honesty
Preparing to change is about far more than agreeing on a budget, setting targets and making a timebound plan. Understanding your position, the sector and your customer is vital. And although that might sound simple – some research, a few meetings – it isn’t. It’s not simple because it demands a level of introspection that many organisations find difficult. Managers can be too focused on projecting a positive attitude and meeting their commitments, and the honest and frank appraisal of the company’s position and preparedness is ignored.
We’re indebted to Peter Knight of the Property Academy for both highlighting the Frost and Sullivan results we mentioned earlier and for putting together a series of questions that any business contemplating a change should be asking itself. Here’s a summary of some of the key points.
Think about the last few changes you’ve made. We’re talking about the significant things, not the tweaks. Anything in the recent past? If not – this is a rapidly changing world – does that hint at a certain reluctance to change?
Ask yourself how you react when a task becomes tricky. Do you park it or walk away? Change is always difficult and often in the areas you expect it to be easy. Have you got the ability and desire to see a change through?
Do you understand your customers? Do they want something new and if so, do they want it from you? Customers change suppliers more readily than ever before. Can you ensure the change you’re planning will give them a better experience or will teething troubles drive them away?
Do you have the knowledge you need to make the right choices? Do you carry out enough research or are your decisions influenced by the actions of others?
These aren’t easy questions to answer, but they are necessary. They are, if you like, a steadying hand for any business planning a change. When you start to look at something new, it’s tempting to go after it and to move fast, to throw resources at it and force a result. If you don’t adopt a steady approach, that result might be the wrong one.
I’m Sim Sekhon, MD of a business that’s operating in a market that’s seen huge amounts of change in recent times and which will continue to do so. My approach is simple: be open to change, be ready when the time is right, steady the ship, then go for it.