Sunday, January 04, 2009

what happens when a company achieves its vision?

One of the interesting things that is commented on in change management texts and can be observed as a frequent phenomena for nearly every company that has ever succeeded is the plateau and slow decline that occurs once they have achieved what it was that they originally set out to achieve. This diagram below best illustrates what I'm talking about:
This graph demonstrates the linear growth trajectory of a successful start-up. However, once the initial vision has been reached and the product range that supported that vision is no longer unique, success plateau's and finally starts to fall. During this contraction phase, a serious of wake-up spikes occur where management reacts to the fall and tries new strategies to re-invigorate the company. However, the loss of an end state (see previous post) means that none of these periods last very long and are always followed by an even sharper fall. Finally, pending doom either results in bankruptcy and death or the re-emergence through a new vision and new mind-set of the organisation. Of course, there are many permutations in how these events take place, but in each permutation the overriding problem of a loss in ends state or vision driving failure. Often it is hard for the original successful organisation to let go of its sacred cows. These are, after all, the things that made them successful in the first place. But, ultimately, what will make the company grow again is an organisation the barely resembles the original at all. Some examples of this may help:

Having nearly died at the end of the 90s, IBM re-invigorated itself to the point where it no longer manufactures computers and makes nearly all its revenue from IT services and software(who would have thought that in the 80s).

Apple went through a tortuous period during the 90s and nearly went out of existence before its original founder created a new vision for the company centred around sleek design that has led to the iPod, iPhone and even a re-emergence of its original Mac product.

Yahoo is currently going through a period of chaos centred around identity (will it re-emerge or die)?

General Motors is representative of the automotive industry in general but as been slower to respond. It is going through a period of chaos centred around a lack of vision now that its big is beautiful vision has been cast aside by society. Will it re-emerge along with the automotive into the new world of electric powered automobiles. There's no doubt in my mind that this is the vision to aspire to in the automotive industry and several organisations have taken up the challenge of meeting this all electric vision (e.g. Better Place, Nissan etc). Progress has been remarkably rapid due to their commitment to a vision they know is real.

What can we learn from this? The truth is that it is difficult to move a big ship once its course has been set and if you don't set a new destination once you reach the original one, you will fail. However, methodologies and tools to do this re-alignment are few on the ground. We have some ideas but are yet to really test them in the marketplace. Any thoughts?

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