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Overcoming the Resistance Hump: It’s Time to Embrace Business Transformation

June 5, 2020Mark Rhodes

“Transformation is no longer a choice.”

Ryan Cunningham shared that thought during Microsoft’s 2020 Business Applications Summit, held online (I suppose you assumed that) earlier in May. I believe it was during the opening keynote (you can see a replay of that and other sessions here if interested).

It’s not a new idea of course. I googled “business adapting to change” and received such highlights as:

  • Adapt Or Die: The Importance Of Adapting To Change
  • Adaptability: The New Competitive Advantage
  • 6 Secrets Of Organizations That Successfully Adapt To Change

Is transformation a choice?

I like how Ryan phrased this thought, but the more I’ve looked at it, the more I realize that it’s never been a choice. I mean sure, you can always choose not to decide, but you’ll still have made a choice (slightly paraphrased from – anyone?, any fellow Rush fans out there? – thank you Neil Peart).  You can easily spend an afternoon reading about companies who were once industry leaders that failed to adapt and have paid a severe price.

the number of companies that comprised the Dow Jones 30 20 years ago left todayYou may think well, sure, things change but it’s easy to find a few isolated examples – most market leaders yield staying power for decades. I find it fun to look back at historical lists of market leaders and see how they change over time. Want to guess how many of the companies that comprised the Dow Jones 30 just 20 years ago are still on that list today? 17. Barely over half. 57%. Almost half of the companies have been removed in just the past 20 years. Those are/were huge companies with smart people being paid a lot of money to grow, dominate, and make more money. In looking back at market transitions, the companies that fascinate me the most are those whose very success was built upon innovation and change. Companies like Sears and Blockbuster rose to be huge corporations because they created and then dominated a new market; for Sears it was the sales catalog and then the “everything” store, and for Blockbuster it was movie and game rentals. If you’re a Gen Xer or Boomer you remember visiting both stores in their heyday – each had no equal at that time.

It’s a good number of MBA-level classes to dig in and evaluate what happened with these companies and why they failed to adapt. Reasons range from cockiness to reliance on the past to unwillingness to change to poor management and more. But the reasons aren’t near as important as the main point – regardless of who you are, your industry, your history, or your level of intelligence – your company must adapt over time. Period. There is no escaping it.

“Sustainable competitive advantage no longer arises exclusively from position, scale, and first-order capabilities in producing or delivering an offering. All those are essentially static. So where does it come from? Increasingly, managers are finding that it stems from the “second-order” organizational capabilities that foster rapid adaptation. Instead of being really good at doing some particular thing, companies must be really good at learning how to do new things.”

Harvard Business Review, “Adaptability: The New Competitive Advantage”, August 2011

The real choice: embrace or resist

So the question becomes, are you going to embrace it and be proactive about adapting, or do you resist and be forced to? Seems clear to me – if you’re going to have to adapt anyway why not be a leader and define your direction, rather than follow someone else?

If you’ve managed a steady business for many years and/or have subscribed to the “if it’s not broke don’t fix it” mentality, right now may be, paradoxically, the best time to shift your mindset. Now, I don’t advocate change just to change. I’ve worked in organizations that drive change simply for change’s sake. Maybe leadership thought that they were being proactive and adapting, but it usually seemed like change was happening without strategy, which made it seem like they were driving change to create an appearance of growth (or maybe to hide something). But back to right now: in this current era, when your instinct is likely to protect and conserve, looking for and seizing new opportunities may well help your company survive this “new normal”. You’ve heard that the best defense is a good offense. While your competition is distracted, what new products can you develop, or what new services can you offer? While the entire planet is suddenly forced to accept change, now could be the perfect time to try something new. What opportunities does that provide your company?

Adapting is a mindset

While now may be a time you’re able to embrace a shift in your mindset, companies that are successful in adapting do not view it as a single event, or only as a task that is part of their annual planning. Being focused on adapting, on creating new ideas and evolving, these are an everyday mindset. And not just with the C-level executives. A company that embraces change and adaptation realizes that fresh ideas can come from anyone on the team. Post-it Notes was created by an engineer who just wanted a better solution for marking hymns in his hymnal. A company that truly embraces innovating and adaptation makes this a part of their culture. Ideas must be driven, creativity celebrated, and mistakes embraced. If you work for an American-based company, you probably know firsthand that last point is especially difficult if not downright discouraged. Plenty of leaders recognize the importance of making mistakes and will openly state they expect them, but truly embedding this into the company culture, calling out and recognizing mistakes in a positive light, and openly discussing and learning from them is a very different story. Without going down that rabbit hole, it’s interesting how every entrepreneur will agree they learned much more from their mistakes than their successes, yet as a company grows, this valuation of risk-taking evaporates.

a quote from harvard business review about the importance of employeesBesides embedding the proper mindset into your company culture, a company must equip their people to drive transformation. Equipping your team is twofold: they need to be encouraged and rewarded to innovate, then be supplied with the tools and the time and space to do so. As far as the tools go, I believe we are at an unprecedented time in history – the information we have at our disposal and the tools with which to analyze and manage all this data have never been more prevalent and powerful. But know that this must a defined effort, or you will accomplish nothing. It’s impossible to provide a one-size-fits-all prescription on how to do this, but honestly you don’t want to be told how, you want to create an approach that works for your company by developing it with your team. You also want to allow the individual members of your team to innovate as they’re personally equipped. Some team members might love analyzing data – so provide them with Power BI and data feeds and let them ask and answer questions on how to radically change your manufacturing process or identify trends that could lead to a new offering. Others may enjoy connecting with customers, so give them Microsoft Customer Insights and let them identify new approaches to strengthen customer loyalty or identify new trends in monitoring customer sentiment or unmet needs.  Remember that none of this happens without providing the time for them to do so (and that doesn’t mean adding it on top of their normal job).

Getting over the resistance hump

At New View Strategies, we’ve had many discussions over the past 3 months about how to respond during these unprecedented times, and you know what I’ve observed? Being forced to be much more creative than before has driven us to do just that. In “normal” times, if your company is doing well you don’t feel much pressure innovate (especially so if the culture is “if it ain’t broke don’t fix it).  I call this the resistance hump. Pressed with the urgent need to innovate, we have found the ability to identify ideas that were previously inaccessible. We’re creating new approaches to how we provide consulting and training that are radically different to anything I’ve seen in 2+ decades in this industry. It’s genuinely exciting! From a consulting project standpoint, we’re rolling out a new model that enables us to truly partner with our clients to be focused on their business and key goals, rather than the traditional, more narrowly focused project-based mindset. This new milestone-driven assistance will allow us to help our clients make transformative change, and it incorporates a truly agile approach, which is so very critical in these times. Perhaps best of all, we’ve shifted to a levelized billing model, to provide cash flow predictability and streamline all the associated non-value-added activity.

As you would expect, our ability to hold our traditional in-person boot camps has been thwarted as well. For a long time we’ve resisted offering our boot camps online, principally because we’re limited to a 4-hour class online (it is simply too hard to participate online for 8 hours), and that the in-person value and experience is so powerful given the teacher interaction and networking. As we’ve been forced over our resistance hump, we’ve discovered that we can leverage technology to replicate the in-person environment. We’re re-formulating our boot camps for the online schedule and are finding a new approach that provides more focus on value and key take-aways. Being online even allows us to incorporate some additional methods and tools that are not easily incorporated into an in-person class. Add in not needing to travel and more flexible scheduling, and we are transforming how classes have been done for the past 3+ decades.

For most companies, 2020 has and will continue to be the most challenging year in their company’s history. Trying to embrace transformation at this time may be incredibly difficult for you right now, but I hope you are able to find a positive direction, looking for and taking advantage of opportunities towards building for the future. If we’re able to help your team in any way, please let us know.

 

To see my previous blog: Got 2 minutes? Time for some Microsoft Dynamics 365 Business Central / NAV tips and tricks! click here.

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The experts at New View Strategies are experienced Dynamics NAV and Business Central trainers and business process consultants who have walked in your shoes as former Corporate Controllers, Directors of IT, and Solution Architects, and believe increased utilization of your business systems is critical to the continued success of your company.
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