I recently completed a program offered by Singularity University in California. The program and people there are focused on exponential technology and the accelerating rate of change that is occurring because of emerging biological, electronic, robotic and other technology. According to the experts there, they say that the rate of change will never be slower than it is today. For those of us struggling to keep up already, that can be scary. It turns out the pace of change has major implications for your company as well.
One of the first things you have to to consider is the rate of change in your industry. Is your market somewhat slow-paced and sleepy where your competitors are sluggish to react (sometimes this doesn't last)? Or, do you have a highly intensive competition which is fueled by VC money trying to spur constant innovation? One of the lessons you learn when you get your MBA is that you need to have a lot of people looking at the market so you don't miss what happens in your market, called boundary spanners. But perhaps an overlooked and more critical aspect is making sure you have the right internal structure and commitment to change to meet those changing market condition.
In a sleepy industry, where the rate of change is slow, you don't need to change incredibly fast to keep up with the market. But in market filled with rapid change, it's not the big organizations that eat the small, it's the fast that consume the slow.
In other words, if you operate in a market with high rates of change, you'd better have the flexibility to make rapid changes. In fact, you need to learn to love change - or you will struggle. Worse, the entire fate of your company could be at risk.
As Jack Welch, the legendary head of GE, once said: "If the rate of change is faster on the outside than it is on the inside, the end is near." To put that another way, if your company can't match or beat the pace of change in the market, it's only a matter of time before you're out of business.
The flip side of this dynamic is that if your organization is clearly changing faster than everyone else - to the point where you are driving the changes in the market and forcing others to play catchup -you are putting yourself in a great position.
Just consider the example of when Apple introduced the iPhone. Up to that point, every other competitor in the cellphone industry offered flip phones. But when Apple basically put a mini-computer in every user's hand, they changed the market for good - and forced everyone, including industry leaders at the time like Blackberry, to try and catch up. Some, of course, couldn't and went out of business.
The real challenge you might face, however, is if your company has been accustomed to operating in slow market that has suddenly been disrupted and become fast moving. I am involved with a business facing this very dynamic. They were successful for many years in keeping ahead of their slower-moving competitors. But more recently new VC fueled competitors have introduced innovations to the market that have put this company on the defensive - and forced it to speed up to keep up. To be honest, I'm not sure what's going to happen because making that kind of change, from slow to fast, can be extremely difficult and painful for most organizations. It may be the most difficult management challenge any leader ever has to face.
So make the time now to look at the market your company operates in and make an honest assessment of how you stand within it before it's too late. Assess whether you're leading change (changing faster than the market) - or reacting to it (slower than the market). And then remember Jack Welch's words of wisdom: Are you changing faster than the market? If not, you have some serious work to do.