Change. To some, it’s frightening; to others, difficult; to still others, it’s inevitable.
Whether you’re a manufacturer, a distributor or a retail operation, change is a complex, time-consuming, risky business.
Relatively minor changes, such as revamping a corporate look, logo or signage, are significant enough to justify lengthy meetings, multiple drafts, even market research.
Certainly then, dramatic changes that will have a direct impact on the very essence of your business are even more significant — for example, changing the kind of product you manufacture, distribute or sell, or the category of product or service that defines you.
Because change is so difficult, most businesses — like most people — avoid change at all costs. The reality, however, is that in a free enterprise system characterised by competition, players have to change or risk certain death.
The moment we stop moving, reacting and repositioning in relation to the competition, we’re wiped out in the high-stakes battle of wits known as capitalism. It’s not change that’s dangerous — it is the avoidance of change that is deadly.
Resisting change
Resistance to change is often a knee-jerk reaction. It’s based on fear of failure, making a mistake.
So the first thing a success-oriented businessperson has to bear in mind is that the real leaders in business have had their noses bloodied many times because those individuals have taken risks, knowing that without risk, you can’t forge ahead.
While there may have been a time when the best approach in business was conservatism, the catchword for the ’90s and well into the 21st century is flexibility. Whether you’re an entrepreneur or manager within a large corporation, the only thing you can count on today is change.
Don’t fall victim to one of the dangerous traps that kill many businesses: classic business myopia.
Myopia takes over when you get too close to your product — virtually fall in love with your product to the extent that you’re blind to market change, consumer change, product change.
You protect your product line like a baby and forget that the way you got into business in the first place was by looking for market changes — correctly intuiting that change means opportunity. In business, we have to change or we die.
Have an open mind
An open mind has business value. Take a step back and analyse your situation objectively. This will represent the first step in ensuring a successful transition in any circumstance: maintaining a broad overview.
To illustrate the concept of identifying a business essence that allows for growth. Let us use as an example a company that produced underwater diving suits and defined their business strictly in terms of those diving suits.
When market conditions required change, they were stuck. If they had defined themselves as a company that manufactured protective uniforms, they would have had room to broaden their line to fire-fighting uniforms, cold-weather protective gear and so on.
How to change
There are five fundamental principles underlying successful identity transitions.
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- Rule #1 — Define the essence of your business. Take a cautious approach to defining the company’s essence. Use your company’s established product line as a starting point. Then find the best markets aligned with that definition but with a totally different perception to increase your sales. Most products that you have or manufacture can easily receive a minor modification enabling a broader base of clients.
- Rule #2 — Don’t be afraid of change. It can be exhilarating and revitalizing. It can increase or spur growth; and it can keep you competitive. To be successful as a long-term operation in a competitive marketplace, you have to be product or service-driven. The minute you stop changing and become complacent, you go out of business. By remaining flexible, aware and observant, you give yourself the opportunity to keep your finger on the pulse of what’s happening.
Rule #3 — Make sure that change doesn’t just take place on the surface. You’re going to have to change the very fabric of your operation. That means that the change has to be effectively communicated so that employees understand their new job definition, seeing it as positive rather than negative. Make sure your employees don’t see their new responsibilities as a threat to their role or identity within the company.
Rule #4 — Realize that change can have a downside. It may mean that you have to let some people go. Change takes real courage, and involves tough decisions and choices.
Rule #5 — Make sure your vision and essence offer a theme upon which you can build. You’re going to need a clear definition and consistent focus to grow your business effectively. Make sure it is not so constricting that it puts new limits on possibilities for diversification down the road.
Envision a cluster of product categories that are all potential fits for you. Arrive at that cluster via a variety of possible diversification strategies along with an objective analysis of where your strengths lie.
And do all this while the timing is right. Don’t wait until the last minute. Procrastination is certainly the thief of time and complacency is its closest living relative. You must develop in your business a culture that is receptive to change. Not change for changes sake, but change when circumstances indicate it.
By Julia Fein Azoulay.
