Our story begins in a nondescript room filled with tired looking executives. Their chairs face each other in a circle. One by one, each person stands up and faces the group. Humbly, they admit their addiction.
As each one speaks, the pain is palpable. All of them can feel their own “rock bottom” closing in quickly. They know something has to give.
Are we describing an AA meeting? Hardly. This scene (which we admit is dramatized to make the point) is taking place in boardrooms around the globe. The players are seasoned leaders who have been forced to face their addiction to a business model that no longer works.
What’s worse is that they are surrounded by hundreds, sometimes thousands of people who are enabling their addiction. The leaders know they need to make radical changes—they have seen the numbers; the writing is on the wall—but they don’t know where to begin, while the people around them keep telling them everything is going to be okay.
What we described is taking place in health care, insurance, publishing, legal and financial services, even higher education.
Could we be describing you and your company? Here are some telltale signs:
1) You are scared to death of cannibalization. You find yourself avoiding ideas that may produce new income streams because existing business lines–and the people who run them–may be threatened. Ironically, revolutionary ideas almost always create the greatest financial return—and freak the most people out internally.
2) You are surrounded by industry vets who seem to be using phrases like, “I’ve been in this business for over 25 years …” in almost every strategy discussion. These folks lament the growing number of (young) people who simply don’t understand “our” business. In extreme textbook addiction cases, these seasoned experts will actually become angry at the customers who are “ruining” their beloved industry.
3) You are competing on price. Your once coveted market leadership is gone. Margins are slimmer but the price–like the morale–is getting pushed lower.
Back to the self help group. Since this is an allegory, we are going to give it a happy ending.
The executives realize that they do indeed have a real problem which Marshall Goldsmith would describe as “what got me here, won’t get me there.” They can no longer deny that the problem is real, and if it isn’t addressed immediately they will be completely and utterly out of options, doomed to go the way of Blockbuster, Oldsmobile, Kodak, Borders, and most pay phone manufacturers.
When this moment of awareness happens, the metaphoric band-aid gets torn off. They are forced to take aggressive—and in some cases, painful—action.
This is how businesses get saved and innovation takes root.