Two hikers were walking through the woods when, suddenly, they encountered a huge, angry bear, ready to devour them. The first hiker immediately bent down to tighten his shoelaces – obviously ready to make a run for it. The second hiker looked at the first hiker incredulously and yelled “What the hell are you doing? You can’t possibly outrun the bear!” The first hiker, having tightened his shoelaces, took off at a brisk sprint and yelled over his shoulder “I don’t have to outrun the bear, I just have to outrun you!” The point of this simple, semi-humorous, semi-morbid business fable is simple – if you want to outperform your competitors during a crisis, you need to take bold, agile and decisive actions and take off at a sprint.
Organizations that “surthrive” (a combination of the words “survive” and “thrive”) the coronavirus pandemic won’t necessarily be the biggest, strongest, fastest or most intelligent. No, the ones that surthrive will be the ones that adapt most quickly to the changes that the pandemic has already ushered in, and will continue to usher in long after the all-clear has been given. These surthrivors will be the ones who find ways to innovate and adapt more quickly than their competitors. Here’s why!
As best-selling author John Spence notes, to be successful, a company’s rate of internal innovation must exceed the external rate of innovation. Even if a business cuts costs, but its rate of innovation does not at least match the rate of innovation of its industry or of its competitors, that business will automatically fall behind. Even during relatively strong economies, each year, companies all over the world, in all shapes and forms fail because they either don’t recognize the changes taking place in their respective industries or, they recognized those changes, but refused to adapt to their new environments.
Take Blockbuster, for instance. In the 1990s, Blockbuster was the behemoth in the video rental business. At the pinnacle of its dominance, Blockbuster operated nearly 9,000 stores and, at one point in time, was worth over $5 Billion. In 2000, the company made $800 million in late fees alone, which, by the way, its customers hated. As the story goes, Reed Hastings, one of Blockbuster’s customers was so unhappy with a $40 late fee that he received from the company that he decided to start his own company and disrupt the industry. That company, of course, was Netflix, which was launched in 1997. The concept behind Netflix was simple: allow customers to rent DVDs online and simply mail them back to the company once they’d finished watching their movie. Oh, and with no late fees! In the early 2000s, Netflix co-founder, Reed Hastings reportedly offered to sell his upstart company to Blockbuster for US$50 million, but Blockbuster turned down the offer. As legend has it, Blockbuster executives pretty much laughed them out of the room! So, Netflix kept plugging on. As digital technology improved, Netflix ditched the DVD model in favor of streaming via the Internet and the rest, as they say, is history. Netflix is now worth billions while, Blockbuster, as you probably know, filed for bankruptcy in 2010 and has now shuttered all but one of its stores.
Here’s another example. Kodak was once the undisputed leader in the film industry. By some estimates, in 1976, 90% of all film and 85% of all film cameras sold in the US were produced by Kodak. But, as things often do in the business world, things changed. The advent of digital technology ushered in a new era in photography – an era that allowed photographers to bypass the traditional film-based approach to taking pictures and go completely digital. As a result, Kodak lost its stronghold in the camera market because it held on to outdated film processing practices. But here’s the kicker. Kodak actually invented the digital camera! A young Kodak engineer by the name of Steven Sasson developed the camera and predicted that digital photography would eventually disrupt the film-based industry. But the company’s executives refused to embrace it for the exact same reason – because it would eventually disrupt the company’s highly profitable film-based products. According to a New York Times article, the company never let Sasson’s camera see the light of day. Kodak suffered the same fate as Blockbuster and filed for bankruptcy in 2012.
Both Blockbuster and Kodak failed, even during relatively strong economies, because their internal rate of innovation didn’t match the rate of innovation of their respective industries. They didn’t tighten their shoelaces and they were devoured by the bear.
The stakes will be even higher for companies determined to surthrive. The changes in the business environment that caused Blockbuster and Kodak to fail occurred gradually over a period of several years. Companies determined to surthrive the pandemic simply don’t have that luxury – the changes being caused by the pandemic are being ushered in over a period of weeks, if not days! Alluvasudden, business practices that were once optional or ‘nice-to-have’ are suddenly critical to surthrival. In the face of social distancing parameters and stay-at-home orders, working remotely is now standard practice. Supermarkets that never offered delivery services are now offering curbside pickups and working with third-party delivery businesses. Schools are now conducting classes online and teachers are using homework apps to deliver and grade homework assignments. Companies are retooling their operations to make new products that may be more in demand during the pandemic.
If you want your brand to surthrive the negative impact of the coronavirus outbreak, you and your team must be willing to quickly adapt to the changes which will be hurled at your organization during and following the pandemic. If you need inspiration to help you generate ideas on how your brand can tighten its shoelaces, do some benchmarking online to see how others in your industry are adapting and evolving. And be sure to ask your team members for ideas on how your brand can adapt its products and services to a COVID-19 working environment. You might be surprised at the number and quality of ideas that you come up with!
