While the willingness and ability to change is recognized and espoused by every business owner or founder I am asked to advise, far too many of you seem to be stuck in a rut, or very slow to actually decide what changes are necessary to survive and thrive.
You may not be blind to the changing market and technology, but being blind to internal traps can be just as devastating.
I saw this challenge of inertia described very well in a new book, Transforming the Clunky Organization, by Samuel B. Bacharach. From his leadership consulting with a host of companies, clunky and innovative, he explains why owners and executives fall into traps of inertia, and he details the critical pragmatic leadership skills needed to regain the required momentum.
Here is our joint list of some common traps that you and your company leaders must avoid at all costs:
1. Too satisfied with how things are going, or status quo
The status quo trap is set when things have gone well for a while, and you are too busy to look ahead to see what's around the corner, or commit time and resources to developing the next generation of innovative ideas.
Then, when market demand slows, you are not able to react in time.
For example, Blockbuster was so busy expanding its hugely profitable video rental business, adding stores at a breakneck rate, that it failed to really take notice of new entrants like Netflix with no late fees, Redbox's automated kiosks, and video-on-demand.
The result was a major change in the industry, and Blockbuster disappeared.
2. Throwing money into a sinking project, hoping to save it
This bailing-too-late trap appears when you make a big investment in a venture that doesn't take off but you refuse to abandon it or pivot because of sunk costs, with the hope of success just over the horizon.
The result is a business damaged past the point of recovery, instead of just dented.
I see this often as an angel investor. I'll be approached by desperate entrepreneurs who have spent all their resources over a period of years on a failing solution but are still convinced that one more cash infusion will turn the curve from down to up.
At this stage, investors won't believe that more money for sales and marketing will turn the tide, so we all lose.
3. Tackling a new market or technology you don't know
When you propose to enter a new market or technology without the requisite resources or skills to compete, you may be triggering the overreaching trap.
Although paradigm shifts and disruptive technologies imply huge new opportunities, they may require more time and risk than you can tolerate.
The Pebble smart watch is an example of overreaching, especially for a startup with limited resources. Even though the original Pebble became the most-funded Kickstarter product of all time, tech giants Apple and Samsung quickly overran Pebble, and it was forced to disappear into Fitbit.
4. Focusing on short-term gains and ignoring long-term risks
Short-term wins are great, but if you pursue them at the expense of long-term success, then it's a trap. Companies caught by the short-term trap often miss new bigger opportunities.
Thinking short-term requires satisfying customer change with more already existing products, skills, and resources.
Kodak is famous for falling prey to the short-term trap. At one time, Kodak was a leading innovative company centered on film photography. The company's short-term focus did not allow it to see the long-term benefits of digital photography, costing Kodak its leadership position and ultimately resulting in its filing for Chapter 11.
5. Letting your company be a victim of analysis paralysis
If you lead your business on endless journeys of analyzing, discussing, researching, and testing new ideas without getting anything off the ground, you are a part of the overthinking trap.
You are guilty of wasting precious time and money, and throwing away the opportunity of real innovation.
The result of any of these traps is an inertia that prevents recognition of the need to change, and a sluggishness in implementing the necessary change actions before it is too late.
If you sense these symptoms in your domain, or hear them highlighted by your advisers, the time to take action is now. I advise initiating a change in your leadership style, before the market moves on without you.