In a world where change is the only constant, more and more new companies are disrupting old industries. Organizations, brands, leaders and employees must adapt to stay competitive. The secret of success is working with talented employees and intelligent tools, but that is not all. Leaders must understand information technologies are not cables and computers but revenue-generating devices, which can help empower talents. And they must understand empowering talents sometimes means giving up their control as leaders. And last but not least - in a fast-moving world, leaders – if ought to be successful - should take time to reflect on past and learn for the future.
The following thoughts are from Round table at the IEDC 28th annual presidents’ forum “Are you a digital or an analogue leader?” with business leaders.
New companies are disrupting old industries
William Fischer, Professor of Innovation Management at IMD Lausanne, Switzerland, points out an interesting practice where leaders can and should make forecasts that are for the period of less than 6 months and more than 20 years. We know what is going to happen in the next 6 months, whereas you can forecast large megatrends for demographics and suchlike over 20 years. It is the period in between that is problematic. That is the period when you have to think differently, because you cannot predict it.
Thorsten Köhler, CEO of YOUR SL, Germany, agrees that the market is changing too fast. In the past a single change would occur at a single time. Now, many changes happen at the same time. New technologies often spring up at the same time. New companies are disrupting old industries. It is very dangerous for a company to ignore this. As a chief executive officer, Köhler’s first thought every morning is “what I could do to make my company faster and change the culture of my company so that I promote collaboration and understand what is going on around me”. Big companies are like oil tankers – heavy and unwieldy – whereas smaller ones can travel like speedboats. Leaders must also think about the future structure of their company. If the world around you changes, you must adapt.
Branislav Vujović, President of New Frontier Group, Austria, explains how they set up a company characterized by the strengths of multinational and local companies in their region: empathetic with respect to local clients, and with a good strategy and sales management. The duality of being a big company with the attitude of a small company is also an approach stressed by Ulrik Nehammer, chief executive officer of Coca-Cola Erfrischungsgetraenke, since it allows the company to gain great possibility to work smarter and faster and continue to grow. While the world around Vujović and his company changed, they had difficulties adapting their culture to the digital world. By splitting the company in two they responded better to different targets and were able to do different things, creating more value for their clients.
The importance of working with talented employees and intelligent tools
According to Sandi Češko, Chairman of Studio Moderna Group, Slovenia, the secret of successful companies is: a lot of great talents that are smarter than the founder. Fischer proposes taking a step further: giving up control in the spirit of being inclusive. The one thing that we know for sure is that we do not know enough. Only by means of collaboration we can know more. The less you do in a leadership position, the more effective you might be.
Another secret of successful companies, according to Češko, is the empowerment of talents by investing in information technologies. 1,500 people are using intelligent tools to manage his company. In this way, they truly are the ones who are managing the company. If there is a problem, they do not need to be told by a top manager to fix it.
Take the time to be reflective
Fischer believes that people who tur ideas into action are differentiated by knowing what they are looking for. It is not a bad idea to go “Ready, aim, fire!” We see organizations that go “Ready, fire, aim!” or “Fire, fire, fire!” or even “Ready, ready, ready!” In a fast-moving world, taking the time to be reflective is too often thought of as a luxury, not as an essential. But it is an essential. You need to understand what is going on. And you need to think it through rather than just shoot at the next thing that goes by.
Being an active learner makes the difference
Not just reflecting on past, Nehammer stresses the importance of learning for the future. He remembers, 10 years ago, he learned things on MBA programs that he could use for the next 5 years or longer. But this year, he had to update his knowledge from last year. And next year, he will have to update the knowledge that he is gaining this year. He believes leaders have to set a standard of being active learners.
Information technologies as revenue-generating devices
Vujović believes information technologies are now one of the most important components of a business model, changing the way we do business and create value. Employees have to change from being experts in information technologies to being experts in the use of information technologies for the purpose of a specific business model. Business solutions are therefore not in information technologies but in business strategy.
The ability to interact with potential customers on various platforms – or so called multi-channel marketing, is the hottest thing in business, according to Češko. Having 20 companies in Central and Eastern Europe, he has been asked what comes next: China or another Asian country. Instead of conquering yet another market, he decided to invest in multi-channel marketing. In 2005, nobody talked about that. He was told he has no vision and no guts to go into new markets. But their growth after 2005, when they stopped going to new markets, increased from 20 percent to 35 percent.
Leaders of tomorrow should remember that change is ubiquitous and profound. That is why, according to Fischer, we need to think differently about the way that we go about our jobs and the way in which we lead.