As a student on an MBA Programme in the UK, in the late 1980s, your columnist was taught about Mission Statements, Objectives and Strategy. That’s the way it was supposed to flow. The business environment was serene and planning was possible. No longer. With technology changing rapidly, government policy shifts unpredictable and market preferences more erratic, companies need to induce greater flexibility in their planning processes. Above everything else, they need to quickly adapt to first survive and then grow.
On a recent expedition to Antarctica, your columnist had an opportunity to engage in a conversation with Jay Desai, Managing Director of Universal Consulting. Jay has been working on a book on how adaptability is the key to survival and victory, with learnings from the animal kingdom applied to business. Most game changing occurrences, he has contended, are triggered really by accident and abrupt events, as opposed to carefully planned strategies. That is simply how it works. As climate change continues to alter Antarctica’s environment, many species are faced with challenges that oblige them to adapt quickly. Penguins are doing so by nesting on land, as opposed to floating ice. Whilst this comes with new dangers, it’s the only way for them to survive as a species.
In the business world, companies that have thrived are often the ones that have adapted swiftly to shifting circumstances. Adaptability, allows them to pivot and innovate, in response to new challenges, ensuring their survival in the face of uncertainty. One of the best examples in business comes from Netflix. Originally a DVD rental service, Netflix was quick to adapt to the rise of streaming in the mid-2000s. When it saw the potential of online streaming and the decline of physical rentals, it pivoted its business model. This shift didn’t just help Netflix survive, it allowed it to become a dominant force. The Covid19 pandemic offers a prime example of accidental events shaping business outcomes. Companies like Zoom and Shopify, experienced explosive growth during the pandemic. Zoom, which had previously been growing steadily, before the pandemic, saw an overnight surge in demand as the world shifted to remote work. Shopify, saw a similar boom as e-commerce skyrocketed during lockdowns. These companies didn't predict the pandemic, but their adaptability to rapidly changing environments enabled them to thrive.
The rise of adaptability as a core competency, is shifting how companies approach their strategic planning. In a rapidly changing environment, businesses must realise that long-term plans are less effective than flexible, adaptable strategies. The key focus is no longer just on predicting the future but on responding quickly to uncertainty. Consequently, the planning of strategy has little to do with ‘Mission Statements’ but rather on a more basic premise – the role and capability of an organisation, in the context of a changing environment.
Traditional strategic plans are based on long-term goals and market forecasts. However, in a world of disruption, companies must adopt more agile approaches that allow them to pivot quickly. Methodologies often associated with software development, emphasise flexibility, enabling companies to continuously evolve. Rather than relying on a single forecast, businesses are using scenario planning. This involves conceiving different future outcomes and preparing for them in advance. Jay’s book, scheduled to be published in a few months, is not a prescriptive document but rather a descriptive stab at explaining how adaptability is the essence of survival across species and business enterprise. It promises to be a must read to appreciate the environment in which we live and do business.