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Repelling the Reaper
by Andy
March 5, 2015

We all see the corporate carnage of those who did not transform or were too late. Sony Walkman gave way to iPod. Xerox gave way to H-P. Barnes & Noble gave way to Amazon. Film (Kodak) gave way to digital imagery (everyone). And it happened very quickly. These corporate forbearers had access to the same opportunity as their upstart rivals, but could not adequately move away from what got them to their lofty status – and were subsequently laid to waste.

Remember, these companies were run by titans of industry who guided their respective firms to the pinnacle of success. They were flush with cash, had strong R&D departments, employed the best and brightest, and leveraged vast product lines across many distribution channels. They should have led the global transformation. Alas, they are now case studies in shortsightedness.

My goal is to not re-bury the dead, but to point out (1) how standing pat can precede a death knell and (2) the decision to venture into uncharted space need not be that frightening.

Before I start, I want to make two assumptions (you can decide on their merits).

  • Assumption #1. B2B firms should not fear “technically advanced” upstarts. Corporate digital transformation and integration is largely complete and the market has adopted a solid tech base – at least in developed economies – so technological differentiation is not a meaningful separator. Upgrades to existing technologies will always emerge, but new and truly game-changing inventions will arguably be fewer and far between over the next 20 years vs. the last 20.
  • Assumption #2. Corporate leaders are not stupid.

I understand why traditional, established firms are not terribly excited to cannonball into the pool of change as there is much to lose. Upstarts, on the other hand, have nothing to lose nor shareholders to please. Rather than change what you do to capitalize on a new but unproven opportunity, which can be very frightening and potentially disastrous, change how you market.

While IBM did a fantastic job of course correcting to consulting while keeping a foot in hardware (arguably a strategic business anomaly), others simply and successfully changed how they market without dramatically changing what they do (see Goldman Sachs, McKinsey). Granted, very few companies enjoy Goldman Sachs’ or McKinsey’s reputation, but that does not mean their competitors are second-rate.

McKinsey’s marketing mandate is to give off an impression of superiority as it reduces their competitive set to only them. McKinsey did not dramatically change its offerings or how it delivers services. It changed its marketing to showcase how uniquely capable it is in solving today’s biggest, most complex business issues. McKinsey’s effective use of thought-leadership and current, relevant content across all of their marketing platforms conveys excellence to all without changing its business model.

Those who don’t appear current, smart, active will be perceived as behind the times and have difficulty attracting new clients. Those who showcase their insights in a compelling, active way are far better positioned for success.

Standing pat may only ensure your case study epitaph.

2 Responses to “Repelling the Reaper”

  1. Nice blog Andy. The hardest thing for established, successful companies is to challenge the very business model that got them to where they are.

  2. I agree. Getting to the top is not nearly as difficult as staying there. The case studies reveal a certain truth: Success is not permanent. It must be pursued and achieved every day.

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