IT PAYS TO BE IN THE DRIVING SEAT OF INDUSTRY EVOLUTION EVEN IF IT ADVERSELY IMPACTS A FIRM’S PROFIT MECHANISM.THE ANSWER TO QUESTION WHETHER A COMPANY WILL BE THE FIRST TO GET TO THE FUTURE WILL BE IN THE AFFIRMATIVE IF IT IS WILLING TO BE THE FIRST TO CONCEPTUALIZE ALTERNATIVE VALUE-DELIVERY MECHANISMS.
For top managers to ensure the survival of their companies, they should endeavour to jettison outdated practices and principles and acquire new proactive ones. A learning organisation should also be an unlearning one. A company discarding outdated practices and conventions will not be a laggard to industry evolution.
A company striving to reinvent its industry a second time, must get up to challenge its orthodoxies and conventions, redefine the market-place, reconceptualize the firm’s boundaries, think up new value propositions and reevaluate its crucial assumptions concerning how it competes.
To start with, a company creates its future by questioning its traditions, taking a broader view of opportunities and threats, and challenging the precedents of its current managerial framework.
Th option of choosing which aspects of the past to leave behind and the ones to use as a pivot to launch into the future is something that concerns a company thinking about creating its future. Unbridled emotional attachment to the past and the intellectual capital associated with it often rears up as an impediment to change, the necessary selective forgetting of certain aspects of the past.
The profit mechanism overseen by the managerial framework of a firm boasts of ardent convictions about the nature of business engaged by the company, the services or goods delivered to customers, the nature of generating money in the business, the critical skills and assets, and the character of the competition. Companies should be vigilant to any factor that poses a threat to its profit mechanism. It must constantly reevaluate its definition of its served market, its margin structure for sustainability and its channels to improve the delivery of particular goods and services. Charles Schwab thought up a more efficient mechanism for delivering brokerage services than that of Merrill Lynch.
It pays to be in the driving seat of industry evolution even if it adversely impacts on a firm’s profit mechanism. Today, Xerox managers rue over allowing Japanese companies to take the initiative in small copiers.
The answer to the question whether a company will be the first to get to the future will be in the affirmative if it is willing to be the first to conceptualize alternative value-delivery mechanisms.