A safe strategy
is not safe
Are we boiling frogs?
Some of you may be aware of the analogy of the Boiled Frog told by the first leadership guru I heard speak, Charles Handy. He illustrated it on the front cover of his 1989 book ‘The Age of Unreason’.
Just in case you missed it, the cover of the book says:
“If you put a frog in water and slowly heat it, the frog will eventually let itself be boiled to death.
We too, will not survive if we don’t respond to the radical way in which the world is changing”
So why am I going back to 1989? Well simply because I think the same message can still be applied to the fast-changing world we face today.
I meet and talk to Managing Directors every day, and irrespective of industry I see the same pattern occurring – it doesn’t matter whether the market is IT (IBM, Microsoft), Images (Letraset, Kodak), Media (Blockbuster) or Advertising (ITV, Newspapers), as technologies and markets change, businesses need to change effectively too.
Whether they are successful or not boils down to how the Managing Director or Chief Executive responds to what initially appears as a risk in changing from an established model.
To me they have three basic choices:
They can keep their heads down, stick to what they are doing apart from minimising spend and hope to survive.
They can see the changing market as an opportunity and grow market share either by working hard to win business from failing rivals, or by acquiring those same rivals while their value is depressed (or non-existent).
They can take strong action to restructure their business around their strengths, possibly cutting costs in some parts of the business to realise the cash to fund the development of the good bits.
One of the above strategies has the (potentially fatal) attraction of appearing to be safe and low risk. But for me it has a strong burning amphibian smell to it. For me, the other two strategies, both of which involve strong and difficult action and involve greater apparent risk are more likely to succeed. They just require strong leadership!