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Find the Silver Lining by Finding, Anticipating, and Adapting to the Nth Degree of Change

Apr 6, 2008
Start-ups are often close to perfectly aligned with irresistible forces because the founding entrepreneurs feel free to disregard the obsolete lessons of the past and present. Your enterprise should temporarily cut its ties to its old thinking as well in this important step by conceptualizing model performance for the future.

Look for examples of perfect alignment with irresistible forces wherever you find them to serve as analogies for opportunities that your irresistible growth enterprise can pursue.

Working through the following questions can help you use new ways of thinking to identify the ideal best practices for locating, anticipating, and adapting to changes in the irresistible forces that your organization encounters.

What are the forces that, if they moved in the wrong ways now, could create significant adverse results to your company?

Make a list and be sure to include: lower prices for your goods and services, higher costs from your suppliers, less buying interest from your customers, greater difficulty of providing goods and services, and an adverse governmental environment.

Add anything else that may apply, such as being overwhelmed by unpredictable new technology that changes the way that you have to operate your company.

Make the list as long as you can. Fill it with your firm's worst current and potential nightmares. Then go on to the next question.

What would be the consequences for your enterprise, competitors, current and potential customers, employees, suppliers, distributors, partners, shareholders, and the communities in which you do business if you imagine these forces at the worst possible levels that would still allow your industry to survive (albeit in a much changed form)?

In a worst-case scenario, many competitors would go out of business, customers would be scrambling to be served, layoffs would be large-scale, and so forth. In focusing on these circumstances, you should immediately start to think about those for whom such conditions would be unacceptable.

Their behavior would probably change in some way that could help to alleviate the situation. For example, customers who really need what you have to offer for high-value applications would be most anxious to have reliable suppliers who would protect them from the disruptions that these events would bring.

Some competitors would be willing to merge before going out of business. Some suppliers would be willing to make concessions to make you more effective before they lost too much business, and so forth. Find out what to do with these ideas by answering the next question.

What irresistible forces are causing these responses?

One possible answer could be that there are two parts to the market, with customers falling into either a high-value or a commodity segment. Trying to serve both segments may be economically insupportable in adverse circumstances because of excess competition.

This factor raises a question of whether or not you can refocus your attention on the high-value segment in such a way that precludes the commodity competitors from being effective against you in that segment.

Alternately, you should also consider whether or not you can achieve such a benefit from being the low-cost supplier to the commodity segment, and automatically inherit the high-value segment in a severe shakeout. Once you know the answer, you can decide which irresistible forces you want to align with.

Which of the conditions that lead to this irresistible force are already present and require action? Continuing with the example, let's assume that there are shared economics whereby it would be most efficient to have one, very large supplier for both the commodity and the high-value segments.

This circumstance would mean that the irresistible force is the need for industry consolidation. If those potential economics exist and there are financially feasible ways to begin the consolidation, then the necessary conditions are already present.

You should simply list them here. You would probably find these conditions to include: ineffectively configured competitors, costs in the industry that are too high, pricing that should be lower, and the need to have a firm that further differentiates its product and service offerings among the high-value and the commodity segments.

The actions needed would probably include changes in how your organization operates to better serve the high-value segment, possibly acquiring or merging with others, and lowering prices for the commodity segment.

What are your no-lose options?

In this example, standing still is probably not one of them. You at least have to make the operational changes needed for the high-value segment, and do them better than anyone else.

You'll probably find that this action will at least leave you as strong as you are now. Going after the commodity segment without the requisite cost position would probably be a losing option.

You might be able to find some combination of acquisitions and mergers, or changed operating practices that would first have to occur before your pursuit of the commodity segment would be a no-lose option.

What are your always-win, no-lose options?

Working with your current and potential customers, employers, suppliers, distributors, partners, shareholders, and the communities in which you operate is probably critical to developing these options.

Basically, you are looking for cooperation from some of these groups who perceive an advantage for them to your moving in the direction of being well aligned with the irresistible force.

For example, adding the capability for the high-value segment's needs is an always-win, no-lose option, if enough customers will give you long-term contracts at a profitable level for adding these customer benefits.

To get your costs down for the commodity segment might require different work rules that differ from the current union agreements in your plants. The union might be willing to renegotiate on these points in exchange for somewhat greater employment stability for existing employees (which you could offer if you are about to gain a lot of market share as a result).

Be sure not to stop when you have found one always-win, no-lose option. There may be others that are more attractive to your irresistible growth enterprise.

Be sure to check how well the options hold up under average and positive conditions, as well. Otherwise, some competitor may grab the opportunity, and drastically reduce your potential benefits.

A good way to check on this is to evaluate always-win, no-lose options from the perspective of your competitors and those you serve.
About the Author
Donald Mitchell is an author of seven books including Adventures of an Optimist, The 2,000 Percent Squared Solution, The 2,000 Percent Solution, The 2,000 Percent Solution Workbook, The Irresistible Growth Enterprise, and The Ultimate Competitive Advantage. Read about creating breakthroughs through 2,000 percent solutions and receive tips by e-mail by registering for free at

http://www.2000percentsolution.com .
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