No business is immune to change. It’s often said that the only constant is change. For long-term survival it’s absolutely vital to take a step back and re-evaluate the products or services that you offer and the way they’re provided, which are separate aspects.
At the heart of every successful business is the product or service. You’ll be solving a commonly perceived ‘need’ or ‘desire’. Whichever it is, needs and desires change and you’ll be out of business if you don’t keep up with the changes or, better still, anticipate and be just ahead of the change. History is filled with lessons from the companies that manufactured mechanical calculating machines, typewriters, and more recent examples like photographic film, let alone examples from the world of fashion where today’s biggest hit is next year’s recycling.
Alternatively, it could be the way that a product or service is delivered that changes dramatically. Electronic mail and cloud-based document storage has decimated letter writing and will undoubtedly remove the need for physical document mailing in time. e-commerce has adversely changed our high streets and the need for bricks and mortar shops (or perhaps not the need, but the commercial viability!).
Businesses that traditionally change most slowly are probably the ones most at risk because they’re not used to rapid change and probably don’t review their services and methods of provision until too late. Accountancy changed relatively little until the introduction of computer technology, and now it’s likely to all change again as we adopt cloud-based finance systems. Embrace change or die is the underlying lesson.
Planning for change
The first step is to recognise the need, ideally before you feel the pain. Every year set aside at least a few hours to analyse your business and the potential and likelihood for change. One of the oldest and most established tools for doing this is a SWOT analysis. For those who aren’t familiar, you basically write down a list of your business Strengths, Weaknesses, Opportunities and Threats. Ideally, involve a range of people across your business and not just senior managers. Look at what your customers are probably thinking, saying and doing.
Look at what your competitors are doing – even if you think they’re crazy. Ask your suppliers for input, because often they’re aware of changes sooner than you will be because they probably supply your competitors. These days you can search the internet and find what people are saying about the products and services in the categories in which you specialise. Consider technological advances and implications on costs, margins, and workforce. If your staff need to have different knowledge it can take a long time to recruit or train so it’s vital to identify needs and start early. Look at international trends too.
All of this information and opinion, once collected, presents the challenge of what to do in response. You might decide to take action in response to threats, or you might be eagerly anticipating opportunities to get ahead of your competitors or to add new products and services. Either way, a good approach is to sift through all the findings and identify the 5-10 points that are worthy of further investigation, then appoint small teams and team leaders to pursue them with a clear brief and deadline.
Once you have a few specific ideas, involve the appropriate people – often those closer to the day to day business rather than senior managers – and create a next level plan with financial values and resource implications. Once you know exactly what each point is likely to add or threaten to lose, the cost to address it and the resource implications (including people), you can create a plan of action.