Jason Jennings is the author of New York Times bestseller The Reinventors – How Extraordinary Companies Embrace Radical Continuous Change. In my interview with Jennings, I ask him to explain the top six reinvention killers that prevent businesses from embracing big changes.
1. Not making growth a guiding principle. Almost every company proclaims it has a list of guiding principles. Generally such lists aren’t worth the time spent crafting them, the paper on which they’re printed or the digital space they occupy because nobody knows them and they aren’t used to make decisions.
The biggest challenge facing any business is finding, keeping and growing the right people. The best way to find and keep great people is by growing constantly. That way people will always have new challenges and the ability to better themselves financially.
Successful reinventors make the achievement of a double-digit improvement in financial performance every year a true guiding principle, and it forces them to embrace constant change and ask the questions and do the things required to live by the guiding principle.
2. Not letting go. One of biggest reinvention killers is refusing to let go of yesterday’s breadwinners, ego, same-old-same-old and conventional wisdom. RIM and Yahoo are two perfect examples of companies that couldn’t let go of legacy products, where the boss had to be the smartest person in the room and where nothing received attention until it was obviously broken. Unfortunately, the immutable law of suckage applies to companies that can’t let go. By the time you’ve figured out you suck; you’ve sucked for a very long time.
3. Not having a clear destination. Any reinvention efforts are certain to fail when the leader of an organization fails to provide a crystal-clear picture of where the organization is headed and what it aims to be, as well as fails to get everyone on board for the journey. People want to know the destination, they want to know their roles in getting there and they want to be acknowledged for their contributions.
There’s only one valid reason leaders fail to communicate the destination and journey: They don’t have a clue themselves. That’s a dangerous leader to be around.
When a company’s destination also has a strong sense of purpose, the likelihood of it being reached is even greater. Who wouldn’t want to play in the sandbox at Google (organizing all the information in the world), at Apple (changing the world, period) or at Facebook (connecting the planet)?
4. Not making lots of small bets. When Howard Schultz retook the reins at Starbucks he took 10,000 workers to New Orleans to build homes for victims of Katrina and told the assembled group that Starbuck’s wasn’t as much about coffee as it was about them and their futures. He added that the only way to have a bright future is to grow.
In the following 18 months the company made a dizzying 150 small bets, including new store design, the testing of wine and beer sales, a new logo, mobile payments, a dessert line called Starbuck’s Petites, Via Instant Coffee in supermarkets and even oatmeal. Schultz’s small bets paid off. The incremental revenue generated brought Starbuck’s profits back to where they’d been before the slide (allowing for organic growth to kick in), the shares more than doubled in value and Schultz was named Fortune’s CEO of the year.
Not being willing to make lots of small bets and scaling those that work and leaving behind those that don’t (without anyone being punished) is the mark of a successful serial reinventor.
5. Not practicing Juggad. Believing that reinvention requires lots of cash is a killer. Embracing radical continuous change requires more of a spirited mindset than it does deep pockets.
Juggad is a Hindi word that describes the ability of people living in rural India to take an ox cart, a steering wheel from an abandoned school bus, an engine off a scooter and somehow create a people moving transport vehicle. It’s a spirit that says, “Let’s start by using what we have to get the job done.”
Mike Long, the CEO, of Arrow Electronics, has built the company into a $22 billion powerhouse. I name him as a quintessential reinventor in the book. He put it this way: “Instead of starting the process of reinvention by asking how much money you’re going to throw at something,” he says, “A better place to start is by asking the question, ‘What’s causing our customers pain, tormenting them or driving them nuts’ and figuring out how to solve their problem. Often,” he says, “you’ll be able to get it done with existing resources.”
About 35 years ago an upstart airline with four planes was running out of money. It wanted to sell one plane, which would solve its immediate cash problem but didn’t want to give up any of the cities it was serving or lay people off. The company started wondering what would happen if it could reduce the on-ground turnaround time from 25 to 10 minutes. Doing the math, the company realized that if it could turn an airplane in 10 minutes it could sell one plane and even add more flights. They sold everyone on the idea and made it work. That airline—you know them as Southwest—became the biggest airline in the U.S.
It’s hard to wonder what might have happened if they’d had deep pockets or a bunch of venture capitalists who’d been willing to ante up more dough. They might never have landed on the reinvention that became their competitive advantage.
6. Not being fast enough. People, who can’t think fast, decide fast, get to market fast and maintain momentum can’t be reinventors.
“If it’s worth doing it’s worth doing now,” is the mantra of successful reinventors. Nothing is going to happen until somebody makes it happens, and there is a need for urgency. In order to be a successful reinventor, companies must weed out those without a need for speed.
"Slow," "plodding," "careful," "cautious," "risk adverse," and "tired" are words that applied in yesteryear. Years ago I was given some sage advice that has served me well and will serve other reinventors well:
“On the planes of hesitation bleach the bones of countless millions who on the dawn of victory paused to rest and while resting died.” There’s no time to rest.
How do you prepare your employees for big changes?
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