There’s a myth that experienced business leaders are dinosaurs from a bygone era – typically old white males who only knew one way to lead, and that way doesn’t work anymore. So “of course” it’s inevitable they will get disrupted by younger, more diverse, more tech-savvy, “new” thinkers. But it’s not true. There are many experienced leaders and managers with the right mindset, who are more than willing to adapt in a fast-changing world.
But there’s a trap. The strategies and tactics that worked in the past don’t work anymore, and they won’t work in the future. It’s not that these leaders don’t know a lot (they do); it’s just that some of those things aren’t true anymore. They used to be true, so it’s natural to believe they are still true, and difficult to give up those beliefs.
If you used to believe in Santa Claus, it’s easy to dismiss that now because you were “just a child” and didn’t know any better. The danger comes when you stubbornly cling to other beliefs that also aren’t true anymore.
That’s why you need the skill of foresight: the ability to look into the future and understand what you need to succeed there. You can then decide objectively what you need to do, regardless of what worked (or didn’t work) in the past.
Some leaders and managers “get it”, but unfortunately, they are in the minority. When Accenture surveyed Australian CEOs about disruption, almost 90% of them expected unprecedented technology change in the near future. But the vast majority (more than 80%) thought the biggest disruption would come either from existing businesses or from inside their industry. They were trying to drive by constantly looking in the rear-view mirror.
Less than one in five admitted that disruption could come from start-up businesses outside their industry. And yet, that’s exactly what we think of when we hear the word “disruption”. The taxi industry wasn’t disrupted by a taxi operator, retail shopping wasn’t disrupted by a retail chain, and the hotel industry wasn’t disrupted by a large hotel chain. They were disrupted by Uber, Amazon, and Airbnb, respectively – all outsiders who were late to the party.
Even incumbents who had the tools of disruption already – like Kodak, who invented the digital camera – didn’t recognise their value until it was too late.
In fact, Kodak is the perfect example of a lack of foresight. Kodak went from the fifth-most valuable brand in the world in 1996 to filing for bankruptcy in 2012. There are many myths about Kodak’s failure: It had too much invested in film, it had grown so big it had stopped innovating, the organisational structure couldn’t cope with a digital world, and even a dramatic story that senior management told the employee who invented the first digital camera to hide it because it would destroy Kodak’s market.
But the reality is simpler (and less dramatic). The first digital camera was as big as a toaster, took 20 seconds to take a picture, and the resolution was much lower than a print. Kodak’s management assessed it, but dismissed it because they thought it would never be good enough to compete with film cameras. They didn’t have the foresight to understand exponential growth, which meant digital camera technology improved much faster than they expected. By the time they realised it, digital platforms like Flickr, Facebook, and Instagram had already made Kodak obsolete.
The world has changed – but have you?
You won’t develop foresight overnight, but you can start by asking these three provocative questions:
- What assets do we have that a start-up company would be happy not to have?
- What “impossible” technology would make our business obsolete?
- If somebody bought this business today, what is the first change they would make?
These questions are designed to challenge your beliefs, because some of those beliefs are rooted in the past and might not be useful anymore. As Josh Billings said:
“It ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so.”
Gihan Perera is a business futurist, speaker, and author who works with business leaders to help them lead and succeed in an uncertain but exciting future. He is the author of ‘Disruption By Design: Leading the change in a fast-changing world’. For more about how Gihan can work with your leaders and teams, visit GihanPerera.com.