When the Old Stories No Longer Fit
Every organizational culture is a collection of the stories that created it. But, as cultures morph, so do their myths, standards and underpinnings. Sometimes, the change is gradual—the result of an expanding market or new partnerships and channels. Occasionally it is explosive—often the result of a game changing new product or service. Certainly, Apple looked very different a year after the introduction of the iPhone in 2007. Netflix, Amazon, Nestle, and a host of smaller and medium sized organizations leveraged changing demographics, workforces, and technology to reinvent all or part of their businesses and expand global brands.
When a company makes that kind of shift externally, there needs to be an equal, often greater shift internally. Business processes, culture, critical metrics, organizational models all need to be re-examined. If, in short order, you are lucky enough to have supply chain issues that require a reinvention from the ground up—then you likely also have (or can find) the resources and clear mandate to undertake that project. But reorienting strategy, culture, and branding to suit a new strategic direction can often be jarring, controversial and difficult to fund and sustain.
Often, the old stories that a company tells about itself are no longer suitable to a new brand, customer base, scale of business or even economic environment. A shift in strategy ages old branding very quickly.
While Apple continued to innovate under Jobs’ leadership, IBM was focused on margins, scale and driving down the cost of manufacturing. Nothing wrong with that of course—but was it enough? Apple might never have gotten a foothold if IBM had not all-but-ignored them. IBM’s “story” was that they had created the market, that Apple was a passing fancy without the capacity to compete. Steve Wozniak developed the Apple One in 1976. By 1984 (less than a decade from the first product prototype), Apple was advertising on the Super Bowl, with ads that specifically targeted IBM’s PC market. By refusing to take Apple seriously, IBM allowed them to enter their market easily—and take share at a rapid rate. Fast forward to 2014 when IBM and Apple forged a global partnership to “Transform Enterprise Mobility”. How the mighty have changed, although in this case—not fallen.
The Apple/ IBM market battle is not the only example of a market leader giving up clear dominance on the altar of unwillingness to see a new value driver for their industry. Blockbuster dismissed companies like Netflix in favor of a “bricks and mortar” structure. Kodak was late to the game with digital photography. Toys R Us eschewed e-commerce as a passing fancy. And Xerox predated IBM in the invention of the PC, but thought going digital would be too expensive and slow to gain adoption.
Of course, hindsight is always 20/20. It is easy to point the finger when looking backward—but how often do we dismiss an idea out of hand or a strategy that is different from the direction we have taken without at least trying the idea on to imagine “What if it happened that way?” A previous coaching client, CEO of a $300 million health-care organization used to make time in her quarterly market meetings to specifically review emerging trends and the organizations who use them well. That process has resulted in 3 promising early-stage acquisitions that run directly counter to her core business. She thinks of them as a lever against complacency. Not a bad idea for any company in 2024.