If at first you don’t succeed, flip it
If you want to have a successful, sustainable business, you need to make strategic moves that effectively flip your business. This is true not just in retail, but in any business.
Let me explain what it looks like for a business to flip over.
Those who never flipped
Kodak did not become Flickr
Encyclopaedia Britannica did not become Wikipedia
Dymocks did not become Amazon
Siemens did not become Apple
Cabcharge did not become Uber
Holiday Inn did not become AirBnB
Blockbuster did not become Netflix
Sony did not become Spotify
Those who flipped successfully
PayPal – once was into cryptography
AOL – once was into Video on Demand
Twitter – once was into Podcast Delivery
Avon – once was into selling books door to door
Nokia – once was a Paper Mill
AirBnB – once was a temporary accommodation for conference goers
Netflix – once was into mail order DVDs
Take Netflix for example
They launched as a DVD mail-order business.
Then they jumped the curved and ‘flipped’ their business model to get into streaming
Now they are getting into direct creative production
What Netflix did is irrelevant for your retail business except to understand and appreciate the scale of disruption and the commitment required.
They were a successful DVD mail order business and overtaking Blockbuster. To go into the content streaming business required a fundamental (paradigmatic) shift in business model, skills, cash flow, technology, customers, marketing – on almost every level they had to change.
They are going through another iteration now in becoming primary entertainment producers. And they will have such rich data about what exactly people like to watch, they are bound to have more successes than failures.
(I won’t be surprised if Netflix starts offering services to their customer base. I am thinking email, home automation, internet of things applications etc would all be within reach, and they clearly are developing the cultural capacity to ride the curves.)
The critical success factors
One: A cultural capacity (willingness + ability) for change.
Two: The strategic skills to identify the right flips to make
Each of those are separate topics to explore in their own right, but in brief just a few points on each:
It is not an objective you can delegate to a subordinate. While someone may be tasked with project management, the CEO and directors have to demonstrably own it, live it and be willingly measured against its success failure.
To succeed at change, you have to understand the systems archetypes in business, and how your structure is connected to your strategy, the staff to the skills, the finances to the systems and so forth.
Imagine the stages of the lifecycle.
It does not matter what business you have, it is not that unique and I guarantee that you currently find yourself in SOME stage of the lifecycle. The trick is to make the plans, take the decisions about a new, scary future before it is upon you.
The challenge is often that the decisions and the short-term results are not in the interests of the current management AND the outcomes are not guaranteed, so there is little cultural incentive to take the plunge. Refer to challenge #1 above.
The key issue is this: working on your flipping strategy should be an ongoing focus.
So the question is: Are you currently working on a strategic f*** over?
If not, the future is as predictable as the shape of a lifecycle curve.
Dennis Price: co-founder at www.yearone.solutions