It doesn’t much matter which stats and odds you look at (and we’ll get to a few in a minute), business longevity is falling. At the same time there is an increasingly attractive world to employees outside our larger institutions, for employment and entrepreneurship. Capital and knowledge have become more accessible in the digital, sharing economy and they are driving this trend.
So we have a battle, and yes, in this collaborative, nurturing, co-opetition world, people are still losing jobs, customers still take their business elsewhere and companies still die. Let’s make no bones about this, where there are winners and losers, there is a battle. Or we could cast it as a high stakes game to make us feel a little better?
This high stakes game is going on but it’s largely unspoken. Organisations are working hard to stay relevant by increasing innovation focus, trying to build entrepreneurial and creative cultures and are talking about disruption and business model innovation. In doing so, you may be coming to the increasing realisation that success largely rests on harnessing and retaining your best and brightest. Basically, you want your teams to be more entrepreneurial so they create new growth. Basically you want to find your Intrapreneurs.
Your best and brightest are, however, now camouflaged. They aren’t the high potentials once recognised for work ethic, can-do attitude and acing their Uni degree. Intrapreneurs look a little more like the dissenting, rebellious, wild idea change makers that you feel like you want to pop in the side of the head every now and then when they become particularly annoying. Why this behaviour? Because they are not challenged, not listened to and not interested in getting an industrial era business model humming when change is afoot. They are disengaged. They aspire to higher. Not higher position but higher performance – of their bit of the organisation. If they didn’t care they wouldn’t be frustrated, they’d be ambivalent. The best of them won’t be willing to, nor need to be, patient. If you haven’t created the entrepreneurial projects they crave, and the business needs – they are ‘outta here’.
Here are the rules of our ‘game’.
Rule #1 – Your business has a 2 in 3 chance of not being around in 15 years. No big deal? Then proceed to rule #2
Rule #2 – Your business has a 1 in 2 chance of not being around in 10 years. Hmmm
Rule #3 – You Business has 1 in 3 chance of not being here in 5 years in its current form. #BahHumbug – 5 years is ages
(but what if the clock started ticking a few years ago?)
If still in business you may proceed to Round 2…
Rule #4 – You have done well to get to round 2, this however quickly goes to your head, you get complacent, “our company rocks” and is “Too Big to Fail” and “no its OK , we do things our way here, that new stuff doesn’t apply”….and then
Rule #5 – If you have survived round 1 and the first part of round 2, you now have close to 90% chance that you will have a major growth stall that threatens the future of your organisation and results in large job losses (sorry not allowed to say ‘job losses’, lets call them ‘right sizing’)
At this stage, is it pertinent to mention that there is a happy ending?
Before we go on to Round 3, let’s look at a Round 2 winner – Nokia – they survived 150 odd years (top 1% of players) but sadly, missed smart-phones and US market penetration but not to worry, Microsoft bought their handset division (April, 2014) for a lazy US$7.9 B. Phew! Hang on a minute, a year later (July 2015) Microsoft writes off US$7.6 B and sends 7,800 people home without a job. A year later (May 2016) the remnants of Nokia’s phone business is sold to Foxconn (Taiwan) for US$350 m. Whoops!
Ready for Round 3?
Rule #6 – You join your organisation, prove yourself a great and promotable employee. You are given new roles and bigger and bigger challenges. #goinggreat
Rile #7 – You start to get annoyed about all the meetings you attend where you are talking about the same stuff, nothing seems to be moving, #groundhogday
Rule #8 – You see your market is changing, your customers have shifted some of your business to other players, you think there is something bigger going on and you want to make some changes. The changes are not in line with HQ’s focus. #strugglegettingsupport
Rule #9 – You are becoming increasingly negative, not how you had ever thought of yourself, you begin to make bolder attempts to change from within. No dice. Ok then – reluctantly and regrettably you are off to greener pastures – such a shame.
So where is the bloody happy ending I hear you ask?…(well there’s that, as well as a few not enjoying the sarcasm and others who are very sceptical about my statistics)
THE HAPPY ENDING (not THAT one, THIS one)
Leaders – listen up – You get a CHOICE in what you do next. The future isn’t written yet. Here are some suggestions:
to give you…
Read this HBR article by Chris Zook and you’ll find out that large businesses actually have a far greater success rate at Entrepreneurship than startups.
“the companies want to discover the entrepreneurs already in their ranks and lure new ones. At least 90% of millennials say they would rather work at a startup than a corporate giant”
to help with…
Read this on how to innovate your business model and launch a new business unit (corporate venture) [Warning: shameless plug – link is to my new book Xcelerate]
On the upside, it has the stats for ASX 200 corporate longevity so we aren’t just talking about the S&P 500 all the time
Get on it – all trends are headwinds to the status quo and most of the digital change hasn’t landed yet for businesses.
AND THE STATS (no judgement, I always like to see the data too)