In October 2001 Polaroid, the company that defined instant photography, filed for bankruptcy because it couldn’t cope with the rapid rise of digital photography. That same year, chocolate bar sales in the U.K fell by Ãã150 million as kids started spending their spare cash on phone cards instead of junk food. Two years prior, an 18-year-old invented a file-sharing software called Napster which would traumatize the music industry and forever changed the way it does business.
Could your company be blindsided in the same way? If you don’t keep on top of current trends and consider what may now seem unfathomable, your chances are pretty good, argues Jim Harris, a Toronto-based management consultant and author.
Last month at Growth Camp, an exclusive conference for leaders of the PROFIT HOT 50, Harris warned just how fast the rug can be pulled from underneath you — and not just by the usual suspects.
“Businesses use to have five and ten year plans, because they could predict that far ahead,” he said. “But when you have an 18-year-old that can cost an industry millions in a matter of months, that’s just not possible anymore.”
Harris explained how many businesses are being blindsided by competitors they didn’t even know existed. By focusing on competing with companies producing similar products to theirs, they ignore upstarts who leverage emerging trends and evolving technology to usurp the kings of industry.
But being blindsided isn’t inevitable. Harris says one of the main mistakes blindsided companies make is failing to discuss the undiscussable.
“There are things in every organization that no one will talk about,” he says. “It’s like having an elephant in the middle of the room that everyone can see, but no one mentions.”
For example, in 1995, when it took hours to download a song onto a computer, the idea of a digital music future would have seemed like science fiction. Nevertheless, had the music industry considered it, Napster might not have caught it so off guard. So says Harris: Look at new technologies, plan out “what if” scenarios and suspend your disbelief — even if it sounds idiotic at the time.
Harris also advises entrepreneurs to continuously work “on” their business, not in it. He says CEOs pay people to run the day-to-day dealings of their company so they should spend most of their time considering what their business will do once it meets its strategic goals and how it will grow, change and react to the world around it.
“As entrepreneurs we have to be continually reflecting on the state of our company’s growth,” he says. “If you want to have balance in your life, you as the driver have to always be changing.”
Finally, Harris advises companies to create an anti-blindsiding strategy, be willing to embrace contrarian views and seek unarticulated needs.
“If companies can learn about a trend early and align with it, they can be the ones blindsiding their competitors,” he says. “Customers can’t tell us what they really want. They will vocalize a fear or frustration, but it’s the entrepreneur who has to create a positive feature from it. Our need for the phone was around way before a phone existed — we just didn’t know it.”
