It is a paradox that businesses compete everyday with organizations in their “industry” and yet look to those very same organizations to validate their performance.
Traditionally, businesses distill various forms of research, sales activities, competitive successes and failures, and sometimes even rumors, in an effort to understand their place in the market and to set the future course of the organization.
But, in a time when all aspects of business is being disrupted, markets are full of uncertainty and it seems there is no clear path ahead where do business leaders look for reassurance that they are making the right decisions? How do they know they are on the right path? Strangely enough, most look to their competition.
Recently, while I was attending an industry conference, a senior manager of a technology partner asked me for my opinion of their organization. Specifically he asked, “How do you perceive us in the market and do you have any concerns about our direction?”
I responded, “I think your organization could be at risk and if some corrections aren’t made quickly you might be in danger of obsolescing to the point of irrelevance.”
While my response seemed to be a bit of a surprise to him, he had a well prepared answer. He countered that his company does regular “market research” and the results showed they are solidly in the middle of the pack as far as industry performance. Stated another way, they had looked at their competition and they were doing okay in comparison.
I responded with a simple question – “What if you are comparing your company to the wrong competition?”
He gave me a perplexed look…
All organizations are competing in a highly disrupted world where everything is changing. And, if everything is changing, it’s quite likely their competition is changing as well. The companies with which organizations competed for the last several years may not be their competition of tomorrow; a result of a shift in the competitive landscape created by new technologies that continue to blur the traditional industry lines.
There are many reports these days about the threat posed to established organizations from non-traditional players. Even the world’s largest organizations are at risk. Take the comments of Jamie Dimon, the Chief Executive of JP Morgan Chase, as an example. He recently stated “When I go to Silicon Valley…They all want to eat our lunch. Every single one of them is going to try.”
Small, nimble and fast moving startups with the ability to reimagine the status quo undoubtedly represent the biggest and most disruptive threat to the majority of organizations. However, I would argue that lack of imagination, inflexibility and the tendency for established organizations to stay in there comfort zones contribute equally to their vulnerability. Established organizations have a tendency to shy away from the unknown and risk associated with innovation. They assume a defensive adaptive posture intended to protect their prior success from those who they view as their “industry competition” instead of taking a wide-angle view of the entire competitive landscape and imagining new possibilities.
The time has past when “managing” was enough and “leading” was optional. Companies can no longer afford to simply adapt to change as it occurs. It is my opinion that the time has come when every organization’s leadership must strive to be a Thought Leader within the markets they intend to serve. Organizations must transform and become innovators in order to survive before they are surprised by a knockout punch from a competitor that they didn’t see coming.