By Allyn Hulteng
It is not the strongest species that survive, nor the most intelligent, but the ones most responsive to change.
The state of the economy in Montana and across the country is in a constant state of evolution. That’s nothing new. What is different is the velocity at which new technologies and economies of scale are emerging, impacting businesses of every size – sometimes with dire consequences. Looking at recent reports, these changes are visible and felt, especially as our Montana economy relies more on “innovative jobs” and professional services.
These shifts and changes have real consequences. According to Vijay Govindarajan, business mortality rates are rising. And the reason why might surprise you. It isn’t because old industries are fading away, in fact business established before 1970 are doing pretty well, but that newer businesses are dying more quickly because they struggle with innovation. While older industries are heavily invested in physical infrastructure, he found that newer business rely increasingly on intangible assets, such as databases, proprietary algorithms, and expert workers.
“The good news is that newer firms are more nimble. The bad news for these firms is that their days are numbered, unless they continually innovate,” he wrote.
When I started down the road to opening my own strategic marketing and branding firm in Montana, it was important to define what success would look like. Growth is often pointed to as a mark of success. But in this economy, size does not seem to be a particular advantage.
Thus, instead of pushing for growth we opted to create scalability. Our “team” includes relationships with high-level creative professionals who are the best in their field. We don’t need to hire for every specialty, we just need to have solid relationships with the best in their field.
This approach offers a bonus for our clients. Having a corral of talented individuals enables us to handpick the best team for each individual project. It’s also efficient, flexible and one of the ways in which we’re embracing adaptability.
A lesson in evolution
Thirty years ago, who would have predicted that landline telephones would become extinct? Or that the Encyclopedia Britannica would one day cease publishing? The impact of innovation on our field has been unbelievable. Even ten year ago, “digital marketing” and “social media influencer strategies” were experimental practices at best and now firms are building profitable businesses on these narrow slices of the marketing mix. Now pause for a moment to consider the next three years. What technologies or changes to the competitive landscape might impact your business? To be sure, your business will be disrupted. It’s not a matter of if, but when.
Alas, no one has a crystal ball. But the “hunker down and wait for the storm of change to pass” strategy is a direct route to failure.
A better action plan is to expect change, be willing to adapt and look for ways to benefit from change. At the core of this strategy is making your organization more nimble. In our practice, we have the opportunity to share our insights on business and marketing strategy with innovative entrepreneurs in Billings and established northwest companies looking to innovate. Here are some of our best words of advice.
- Be decisive. Good business decision-making is fundamental to every strong business. Practice making good business decisions more quickly.
- Observe. Pay close attention to what is going on within your business and in the world. Information can provide an early alert to both opportunities and challenges. Monitor news and business topics using Google Alerts and LinkedIn.
- Be willing to redirect. Fear can be paralyzing. Be prepared so that when a change does occur which has the ability to impact your business (it will) that you respond quickly and appropriately. Speed and confidence are imperative.
- Become scalable. Refine your business so that you can quickly scale up to take on more work, or scale down when needed.
- Avoid single point failures. What happens if you lose a key customer? What if your primary product becomes obsolete overnight? What happens if revenues drop 15%? Review your business diversity so that success isn’t dependant on one or two components.
- Practice being frugal. By avoiding excessive outlays of money when business is good, you position yourself to better weather downturns in the economy.
- Be a leader. Managers tell people what to do and when to do it. Leaders create a vision and a roadmap for the team and empower team members to work toward the goal.