In my previous post, I talked about Darwin's law of evolution (roughly - "it's not the strongest that survive, it's the ones that adapt best to change") and how it applies equally well to business as species evolution. I wanted to elaborate on what 'adaptability' means for business. There are many facets:
-- The ability to shift market focus when necessary
-- A management structure that can make decisions quickly
-- An ability to listen to customers, continually update marketing tactics and innovate products and services
-- The capability to scale production to changing market demand without adversely affecting margins
-- The ability to shift resources from poorly-performing areas into more lucrative areas
The question for business is whether adaptability is only effective as a proactive skill (eg the ability to forecast market trends and reposition in advance of those trends becoming widely apparent) or whether adaptability is equally effective as a reactive tool.
Is a business adaptable only if it consistently spots trends as they emerge? Or is it also adaptable if it reacts to a trend that has already become clear in the market?
Based on my experience, I think businesses are adaptable first and foremost if they can react to change. The reality is that markets often don’t change as quickly as we think they will. A business that can see that a market has changed and react to that change effectively will be a successful business over the long term, for the most part. (Yes, there are some stunning examples – like the photo processing market – that refute this).
And that’s where I think this reality is changing. The world is changing faster than it used to. As an example, the adoption of social media tools has been much more rapid than, say, the adoption of TV or radio. So while businesses have been able to survive based on the ability to react to change, I think it is becoming essential for businesses to be able to proactively address change.
In my next post I’ll talk about how companies can do that.