The stock markets have been expecting a brighter future for finances for a while now, the unemployment rate is pegging for the new normal of around 7% for healthy employment and there is a sense of optimism that is growing. The future is bright, so businesses are taking on a more assertive approach to revenue generation and investment. This is the good news, but the challenge will be to keep the ball rolling. Five issues businesses need a leadership mode on have surfaced that I think are crucial for 2014 and beyond. In Part II, I will be talking about the about the role of technologies in this digital age and in Part III, I will be talking about the role of business processes.
For organizations that want to not just thrive, but capitalize on emerging conditions, there are practices that need to be put into place to deal with the uncertainties we face today. Uncertainty is all around us with Geo-political events, non-productive politicians and emerging sources of competition. An important practice to put in place around scenario planning with prepared responses for organizations with planning cultures.Even at an operational level using predictive capabilities have proven profitable for cross selling and determining next best actions. For the vast majority of organizations that are more reactive, in nature, building explicit agility levers, goals, policies and rules into every aspect of the organizations processes, procedures and systems is a must. See what one group of health related organizations did to plan optimal health networks:
Like it or not, change is accelerating and the rewards go to the organizations that can respond to or intercept the effect of expected change. Time to market product or service introduction is a key piece of this as well as being responsive to change within markets. The organizations with the most intelligent business operations are aiming towards real time response to change. This ends up being long term journey that can be taken in incremental steps towards targeted transformations. This means learning new ways of sensing patterns, analyzing options and acting in faster ways over time. Consider what on major European airport has done with one of their first steps:
It is well documented that the longevity of organizations has reduced significantly and there are smarter people than me that predict this trend to accelerate. We can all think of companies that did not innovate or change whose bones are no buried inside another company or just plain long gone and forgotten. There is a line of thinking that says "you must add innovation to your business model or face a spin down over time". This places a premium on looking for emerging business models, practices and technologies that can help organizations not only survive, but go beyond it. I can think of stable companies that have accelerated asset growth by expanding their product lines to stay current with emerging trends. Northwestern Financial Network just used to sell whole life insurance, but look what it has done to expand it's presence. NML has always wanted to be innovative to save costs, but it turned out to use business and technical innovation to expand it's business while staying a low cost leader. Just saying. See what Jabil has done to expand it's business and increase revenue through innovation.
There is a great emphasis on gaining new customers and keeping them engaged that started to emerge in the second half of 2013. While CRM practices have gone a long way to help operationally, business organizations need to go beyond simple CRM and expand the scope of customer to constituencies such as partners, vendors, employees and the collective set of informal interactions with the public. There is a rush to add new customers to gain revenue lift. This will not only be done with better and innovative products and services, but by the way organizations allow constituents to have better visibility into processes that touch them. In addition, the organizations that allow constituents to customize their interactions with said organization, will win in the long run. People do not want to be treated as standard commodities and kept in the dark. They want real time visibility and adjustment features that make them feel important. See what Telstra is doing for their first step in their customer journey
As was indicated earlier in this post, the longevity of organizations are being challenged by the changing business environment today. Intelligent organizations are embracing the measurement of factors that could enhance or threaten the organization. While most organizations are good at measuring risk, the premium on expanding the measurement to more factors of wellness. This should include measurements on sustainability, citizenship, levels of distraction, culture and workforce happiness.
Organizations that step up to the challenges emerging in 2014 will likely reap the rewards. Those that don't risk the consequences in the long run. Go big or go home. Stay tuned for Part II & Part III of this series.