I’ve spoken many times before about the learning and sharing culture in ActionCOACH, where knowledge, learning and alternative ideas are shared. This culture is driven from the top of ActionCOACH and there are numerous events for the Coaches to learn and share ideas, which in turn we can then pass on to our clients. In the UK, ActionCOACH regularly arranges for external speakers to present to the community to provide alternative views and ideas. Last Friday we had a great presentation from Jonathan MacDonald, who is the author of a number of books the latest of which is Powered by Change.

Why do I mention this?

If you ignore the change in your industry you are sentencing your business to a gradual decline

Jonathan spoke about a company’s lack of responsiveness to change being inversely proportional to their exponential growth. That is the leaders of company’s lack of appetite to accept and adjust to changes in their industry or market place, with often catastrophic consequences. For example the music industry was in steady decline with the demise of vinyl, tape and CD up to the millennium, after which there was a massive rise in digital at far higher volumes but far cheaper, which the traditional music industry largely missed out on as they desperately held on to the profitability of their old business model despite massive evidence that this was dying. There are many others that we are all aware of, the Telecom industries response to mobile as traditional wired telephones declined or taxis denial of the threat from Uber.

Only 1 in 5 new businesses make it to their 5^th Birthday and I suspect that will be negatively impacted by the current crisis. What I also learnt was that apparently

91% of business failures are attributable to factors inside the business, with only 8% being external to the business or 1% being just sheer bad luck. In other words if our business fails it is probably our fault!

You need to understand how your business is being impacted by change and react before it is too late

This underlines why it is so important to plan your business and not just let it be shaped by external influences. What do you want your business to become? What will it be like when you get there? How do you plan to get there?

And having put a plan in place make sure you are executing against it by testing and measuring all parts of the organisation. To understand where your business is growing and where it is declining, and if it is declining understand why and put in place a plan to recover.

The threat to our businesses is greater than ever

Jonathan also talked about how, over time, our business models decline in relevance as the industry changes or the market evolves, such as the car industry now moving towards electric vehicles. Businesses are usually resistant or reluctant to accept that fundamental change in their market is anything other than trivial; Kodak laughed at competition to their dominant position from the Smart Phones; Hilton thought they were not in the same industry as Airbnb.

This is particularly relevant as we all try and figure out what the New Normal will be in our industry as we come out of COVID-19. How will our market or industry change now that remote working has become more acceptable, many traditional shops will have moved to web-based sales and the manufacturing supply chains are being redesigned to be more resilient.

Every business needs to be planning now for how their industry or market has changed and how they need to change to take advantage of the opportunities this presents.

False Expectations Appearing Real

One of the main obstacles to change is our fear of what change will mean, so the only way to reduce that fear is to understand what is changing and how that impacts us. As our understanding increases the fear reduces.

This is where good Leadership becomes important and building a winning team in your business with a common goal, agreed ways of working together and a plan that you are all following. To increase your understanding of what the New Normal will look like and how your business should adjust you need to try new things and measure the results, then develop the successful ideas. This will require that as a Leader you need to support risk taking in your business in a controlled manner (not betting the year’s profit on the 13:20 at Newmarket!) and foster an environment of 100% Involvement by all members of the team.

You Can avoid Reality, but you cannot ignore the consequences of ignoring reality – Ayn Rand

Where is your industry today and where will in be in the future, how will in change as a result of COVID-19? Then what is it that you need to do to survive and thrive?