The Straight Line to Mediocrity
I came out of Business School believing that all business success was really a straight line.
- We identify our value - that thing we do so well.
- We then identify who wants to buy that value - the market that needs us.
- We create a plan to serve that market and away we go.
The idea that we can create a straight line to success is 20th century thinking.
We all have straight line thinking. We are trained to think in a repeat the successful pattern way. It's called logic - the safety zone of our left brains. But as I always say - growth doesn't live in the safe zone.
Straight lines of predictable behavior are gone with the dynamic winds of today's markets. Evolution is no longer a choice - it's a necessity for success. Yet most of us LIKE straight lines. But just look at what can happen when we stick to the straight line thinking.
Turnarounds follow those straight lines - all the way to the crash. Every turnaround I've worked with had one thing in common. They stuck to their straight line approach to business - based on their past successes. They didn't see, or more likely couldn't see, the shifts around them. Their markets took a left or right turn or just plain disappeared. Yet these turnarounds followed that straight line of gravity right over the cliff. Want some examples of straight line thinking that ended in a big boom? How about GM with the straight line of big cars - in the face of electric cars and high gas prices? Or BlockBuster and Circuit City hanging onto their physical stores as internet-focused innovators pulled the market out from under them. Examples are all around us...
What about the straight lines of startups? Say what? Startups don't have straight lines. They're just getting started - there's no gravity there. Want to make a bet? I've worked with dozens of startups and many had their straight line plan, based on the last successful startup funded by the investors or powered by the executive team. After all - if the straight line plan turned profitable for the last business, why not this one too? Um, that's gravity thinking folks.
Startarounds follow straight lines too. Startarounds are my terms for the businesses that are losing momentum or lift in the business flight - but they step up to shift to a different course before they hit the wall hard. Actually, GM in many ways is a startaround, although they were forced to face the music by our government saviors, not of their own doing.
The fact is that in the new economy - we're all startarounds to some extent or another.
All of our straight lines shifted. Either we shift to see that the new lines are zigging and zagging around us - or we end up spiraling downwards and wondering what happened.
The new economy rewards those who think dynamically, adapting their course to meet the changing perceptions and preferences of their markets and customers. Want some examples? Ok - the easy one first - Apple. But there are so many more! Best Buy, Netflix, Legos, Quid Si...the list goes on and on.
So here's a little exercise. Let's identify your straight line thinking. How do you find it? Look for any belief that says "If...then." For example....
- If I capture 10 accounts this month, I'll capture double that next month.
- If I sell this client, these others will follow.
- If I drop my price, my sales volume will increase.
- If I win this big deal, I'll get more business down the pike.
- And on, and on.....
- What if I take a hard look at my expansion rates based on today's customer capture rate?
- What if I focus on selling multiple customers vs the one big deal?
- What if I don't drop my price? What if I increase my sales volume through increased Value?
- What if I win this big deal and it sucks up all my resources? How else could I make more profitable deals?