Speed is the new currency of business
Beaten by the digital revolution, the world's biggest film company filed for bankruptcy in 2012. How you grow your business today boils down to speed. If you are not going fast enough somebody else is.
When Sony came out with their first electronic camera in 1981, the then Chief Executive Officer of Eastman Kodak, Vince Barabba, conducted a very extensive market research to assess the risk that digital photography paused to Kodak’s silver film business. Kodak was in the photo film, chemical and paper business.
Kodak company sales in 1981 were $10 billion!
For over 30 years, the executive leadership at Kodak continued to focus on their core business. They regarded digital photography as the enemy that would kill the chemical-based film and paper business that fueled Kodak’s sales and profits for decades.
Globally, CEOs are continually thinking about ways in which they can move their organisations forward and make them more competitive to win in the market place.
The traditional value proposition is either better quality or lower price. Today, either model gives you no strategic edge against your competition.
Today, how you leverage ICT is what gives your business the edge.
Speed is the new currency of business! If you cannot get your organisation to accelerate the technology that will allow you to win, then you are certainly falling behind. Business strategy is now completely one and the same with Information Technology strategy. There is no business strategy without the Information Technology underpinnings that is going to allow you to win in the market place.
Many of the large enterprises have existing, rigid, slow, expensive, legacy, Information Technology environments, which have been built over a period of 10 to 30 years. Many of the business leaders today know that they must move from where they are to where they must be today; and do so fast, very fast.
As a CEO, how do you balance the needs of your existing Information Technology infrastructure that runs your business and runs your supply chain, while at the same time you move to a new environment? What capabilities does your business need to have to make this transformation?
What this is driving at is incremental organisational change. This change can only happen with a suitable strategy. The questions to ask are where are you today and where are you going to be in the next 3 to 5 to 10 years? What are the milestones? What is the business case for getting it done? How will the business finance this transformation? Without a multi-year plan you are surely bound to see huge cost-overruns and disappointments in delivery for your business.
It’s impossible to move fast enough in this new paradigm without rethinking your vision and business model. One such strategic shift is to pivot to a consumption-based model by moving capital expenditures to operational expenditures, then working along with multiple internal and external partners to execute your plan.
A cultural revolution is the toughest part of any transformation initiative. Cultural change is crucial to the new way of doing business. The new values that constitute this cultural revolution in your organisation will determine the level and speed of success at the various stages of your transformation journey.
Did you know that in 1975, Kodak invented the electronic camera? Yes, they did!
It was clear that digital photography was coming for Kodak’s revenues. The market research estimated that this would happen in about 10 years. Given these findings, what did Kodak do? Did they prepare to transition their business model to digital? No! Kodak chose to use digital to improve the quality of their film. Well, Kodak filed for bankruptcy in 2012.
How you grow your business today boils down to speed because if you are not going fast enough somebody else is. Don’t sit and watch your business repeat the strategic mistakes that led Kodak to bankruptcy.