Nov 15, 2012
When Albert Einstein said “The Definition of Insanity is doing the same thing over and over and expecting a different result,” he was merely recognizing the fault in continuing a behavior if your desire is to change course.
Therefore if you continue to do the same thing because the result is what you are looking for then insanity would really become changing course. Right?
So change isn’t always necessary for your business, but it is always taking place.
The catch with Einstein’s theory about insanity is founded in its foresight. Because it is completely insane to continue to do what is working “Now” without any expectation that you will be required to change to drive a different result in the future.
Technology, specifically the Smart Phone business serves as a great example for the insanity of continuing to do what works until it doesn’t work anymore.
Take Research in Motion (RIM), the once beloved manufacturer of the blackberry. They had a technology that had become ubiquitous with mobile email. They also had a lion share of the market for smart devices and an absolute cash cow. In just 5 years their market share is now 25% of what it used to be.
While RIM’s fall out in recent months has been a spectacle as is anytime a wall street darling falls off a cliff, they are hardly alone. Think about once great names like Palm, Motorola, Nokia and Sony (Ericson) . All of these companies were once dominant players in wireless handsets. And while they are all still around in some way shape or form, they are a fraction of the giants that they once were.
So what did all of these companies do wrong that led them into this position.
Well before we talk about the mistakes, let’s give some credit. All of these companies did some things very well. Whether it was R&D, Marketing or Strategic Alliances (Think AT&T and Apple with the iPhone), each of these companies ascended to greatness by latching on to a winning formula and riding it into prosperity.
Seemingly a formula for success, and certainly not insane. Even Einstein would concur.
However, as quickly as they ascended, they fell because they ignored the change that surrounded them.
In the case of RIM, they waited too long to acknowledge the market shift. With the emergence of Apple and Google Android, RIM was caught off guard. Of course they tried to take action with the delivery of new more innovative and competitive products, but by the time they brought them to market they had lost the edge that once made just about everything they introduced into a hit.
For your business the same rule applies.
While the things that you are doing right now may be creating growth and profitability for your business, you have to be aware that change is looming. That is why long term planning is so important and more importantly understanding the trends in the external environment that affect your business.
Leaders that understand the impact of change are constantly asking themselves questions such as…
- What are the industry changes that have taken place over the past year, three years, five years etc?
- How have those changes impacted our core products and services?
- Have we seen a shift in where are profits (or losses) are being generated?
- Are we seeing more or less attrition from customers than in the past?
- How are other similar companies in our industry performing?
- How are our supply chain partners performing? (If the suppliers you work with are struggling it could be a sign that your product is becoming inferior)
- What mix of products and services do we plan to deliver in the next one, three, five years and beyond?
Of course every industry is different, the change that our world is seeing isn’t slowing down for everyone. Newspapers weren’t killed by the emergence of better newspapers, they were killed by an entirely different medium (The Internet). These types of anecdotes can be found in just about any industry. So what about yours?
Bottom line is you need to focus on what is working now but the smarter business owners and leaders NEVER stop thinking about what is coming next that may affect their business.
So stay sane and stay on course if the methods are driving the metrics. But don’t underestimate what Einstein was saying by continuing down the course with blinders on. Ultimately your ability to drive a different result is going to be your key to sustainability.