In the 1900s, a good plan, hard work, and a winning smile were the ticket to success in business. The 21st Century is a totally new deal. Consider:
Change. More happens in one of your minutes than in one of your grandfather’s hours. Measured in terms of accomplishment, the 20th century will see not 100, but 20,000 20th-Century style years! Business has become a roller-coaster ride.
Information. More information was created in the last twelve months than in the previous history of civilization! College curricula, training courses, and nonfiction books are obsolete the day they’re published. Staying ahead has been replaced by finding the answer you need when you need it.
Volatility. Abnormal is the new normal. Highs are higher; lows are lower. Extremes prevail. Financial markets. Weather patterns. Entire industries have been vanished. Remember vinyl records? Typewriters? Kodak film? Local bookstores? Healthy newspapers?
Value. In 1980, 80% of the value of American corporations was tangible. Assets on the balance sheet — plant, equipment, cash — accounted for the bulk of what shareholders invested in. Twenty years later, that value had migrated to intangibles — know-how, relationships, and secret sauce. Ideas have become more valuable than things.
Connections. International used to mean you had offices in Paris and maybe Tokyo. Today competitors from countries you’ve never heard of eat your lunch. The quality of your deliverables depends on suppliers and partners spread around the globe. Everything’s connected to everything else. Success rides on relationships.
Unpredictability. Man plans; God laughs. Only fools make ten-year plans, for nothing’s certain in our complex world. Should you hire a futurist? Don’t. Recent studies find that you’d be equally successful throwing darts blindfolded. Embrace change.
Work. Simple work has been automated. Procedural work is being outsourced. The work that adds value is conceptual. Conceptual work involves solving novel problems and doing things that don’t appear in job descriptions. It’s perpetual improv. Success requires the ability to adapt in real time.
Speed. Fourteen years ago Intel’s CEO likened his company to a car racing down the highway at 150 miles per hour. Intel knew there was a brick wall up ahead but it dared not slow down. Factor in the acceleration from Moore’s Law, and that car is topping 250,000 miles per hour today. Slowing down is still not an option.
So what’s a company to do? They must figure out how to change course in real time in order to survive. They need to be able to swerve when even the hint of a wall appears on the road ahead.
Cars are machines. Turn the steering wheel to the left; the car changes direction. If only business were this easy.
Organizations are people. Turn the wheel and most organizations continue barreling down the road in a straight line. “Turn left! Turn left!” shouts the CEO. Nothing happens. That’s why the life-span of a Fortune 500 company has fallen below fifty years and the tenure of a Fortune 500 CEO below seven years. Their organizations keep running into the wall.
The ideal organization would behave more like fish. Last month I watched schools of hundreds (thousands?) of sardines swimming in perfect synchronization in the giant kelp forest tank at the Monterey Bay Aquarium.
I couldn’t discern a leader of the pack. There was no sardine CEO. Yet the school moved as one. Workers need to act like sardines, changing direction in concert when they sense there’s a hungry shark or a brick wall up ahead.
Instead of the “schooling” of the 19th and 20th centuries that sought to indoctrinate people with the formulas that had worked in the past, our new schools of workers need to know how to read the signals quickly, trust one another to turn in the right direction, share what the environment is telling them, and be ready to swerve when they sense that wall ahead.
Instead of erecting walls between departments and functions, flexible organizations tap into a shared flow of intelligence fed by every tributary where action takes place. People work in concert, continuously ping their environment is search of opportunity (and looming walls) and share their insights. Everyone’s empowered to influence the group, like a line worker at Toyota or a sardine that senses an octopus near-by.
Organizations that ape the military by barking orders down a chain of command, embracing a caste system of officers and staff, and relying on strategy laid out far in advance of battle are doomed. Today’s victors knit together responsive networks where every worker has a voice. Their guerilla tactics win out over rigid, unyielding structures every time.
Resilient companies help workers bond like schools of fish instead of schools of teachers and students.