Watching in shock as the reigning Premier league champions Man City got thrashed by Leicester, I pondered on how quickly the almighty bedrock of the status quo gets pushed around so easily and so unexpectedly sometimes. It is like a little success and stability precludes us from believing in anything changing ever again. Our brains yearn for a stable knowable world that is unchanging – even in such a changeable thing as football.
It is very similar in business. Market leaders sit back and fall into a lazy belief that current success and profit equals future success and profit. They forget to listen to the market and their customers. Then their customers’ buying behaviour changes in reaction to new technologies and boom! suddenly there is a new incumbent and they are playing catch up.
It seems too much winning breeds too much confidence which then becomes the seed for future failure.
The key to getting ahead and staying ahead is innovative reinvention. But not reinvention for reinvention’s sake – but reinvention squarely based on anticipated future technologies and customer behaviour. Listen, learn, invent, change, listen, learn, invent, change etc. It is a continual process of change.
Mass products and services are always behind the curve – that is their natural place. But the curve now changes with such violent speed that companies can find themselves behind so quickly that unless they have invested in good strategic R&D they will not catch up.
Technological change is now so quick and so unexpected that companies need future vision and strategy to react with speed to this ‘alien technology’ that emerges from nowhere. They must be forever expecting alien entrants to their market and must be prepared through visionary R&D spend.
In short, get ready for an alien invasion!
R&D spend is crucial for every company in every industry in the Digital Age because it is the only way to prepare for future customer behaviour change brought about unexpected technological advances. No company can now solely rely on incremental improvements to current products & services. They need strong strategies in their back pockets ready for new s-curves and the technological and customer behaviour changes that give market disruptors competitive advantage. In digital, strategic vision is everything.
The equation is simple : No visionary R&D equals no answer to market disruptors
If a new technology suddenly appears in your market, how will you react? You can’t suddenly turn into an innovative company – innovation takes vision, strategy and investment over a period of years.
Innovation is not reactive, it is predictive.
Kodak had two very big tech s-curves to deal with in their market – digital photography and the camera phone – both of which they did not take seriously. And both of which radically changed their customers’ behaviours and ultimately bankrupted Kodak. They went from an innovative company to an incumbent trying to protect the status quo. They lost.
How do we prepare for this? How do we create and keep a mental state of siege in the culture of our company so we are ready for an alien s-curve?
S-curve blindness is a common trait of incumbents. This needs to be replaced with a type of s-curve hyper-anxiety – the feeling that any disrupting innovation outside of our industry is an immediate threat to our future and needs to be prepared for.
We need to prepare ourselves for the emergence of alien technologies – and build our companies around this type of thinking.
Ultimately the question is – would you survive an alien technology s-curve in your industry? If the answer is no I suggest you get a skunk works funded and up & running immediately. Your days may be numbered.