June 4, 2021
5 minutes reading
Opinions expressed by Businessmen the contributors are their own.
Once iconic companies, including Nokia, Kodak, Blockbuster and Xerox, disappeared from the market because they couldn’t survive the times discontinuity. Once seen as model operations globally, technological disruption has wiped them out. One lesson to be learned is that CEOs should not take any organizational achievements for granted. Instead, they should be mentally prepared to take advantage of the disruption effectively.
Disruption is not a new phenomenon
In the current global business environment, all sectors are disrupted – industries, organizations and individuals. Nothing is immune to it. Digital cameras broke analog cameras, quartz watches did the same with mechanical watches, and iPhones replaced the Blackberry. We can see these market fluctuations from the use of desktops, laptops to smartphones. The First Industrial Revolution disrupted the traditional methods of making a living and making money with steam power and mechanized production. The second disrupts the first by changing lifestyles through electric power and international mass production. The third interrupts the second by automating such a production process. At present, the fourth such revolution, digital, is immediately throwing new challenges and opportunities to humanity, and is evolving at an exponential rather than linear rate.
Humans evolved from the Stone Age to the Space Age, largely through disruption, and must continue to accept change in order to survive both materially and economically. Likewise, organizations must embrace rapid changes in circumstances and innovate continuously by anticipating and preparing. Some of the most recently challenged industries are education, computing, banking, publishing and print media, as well as insurance, real estate, construction and healthcare. And some of the best-performing companies, along with their workforces, could soon disappear if they don’t innovate; A 2017 report by McKinsey Global Institute estimates that between 400 million and 800 million jobs today will be automated by 2030.
The role of the CEO in the era of disbandment
In this digital age, small technological innovations can change a large industry or organization. With the advent of artificial intelligence and the Fourth Industrial Revolution, predicting future disruptions has also become especially difficult to predict. Therefore, CEOs must be mentally prepared for industry and organizational changes. They must be prepared to weather volatility, uncertainty, complexity, and ambiguity (VUCA). They must change their core business models and effectively communicate them to all stakeholders. They have to build their capacity and capabilities. They must become champions of change.
CEOs often emphasize short-term goals such as improving profitability rather than long-term goals of anticipation and preparation. They must emphasize both to ensure survival and success. There must be a long-term strategy to embrace change: choose the right Technology; emphasize organizational culture; collaborate on different functions; bridge the gap between strategy and execution; and promote agility to accomplish organizational goals and objectives.
The disruption is created by new entrants and game-changing technology alike, and the pace of change is enormous. Talents are sometimes scarce and have the opportunity to rise. Therefore, CEOs must acquire talent and act quickly to adapt and adopt new technologies and business models. They must focus on the long-term interests of innovation at least in terms of short-term benefits from disruption.
Related: How to make better decisions
The CEO’s role in leading strategic change
Business executives have a multitude of organizational challenges. One of them is embracing change effectively. This is easier said than done as there are several tasks involved in this process. One is to improve processes and procedures and rebrand without affecting the core brand. While every CEO understands that change is inevitable, some are uncomfortable with it. They value the status quo and emphasize continuous improvement. That doesn’t help in the long run. They can also make the mistake of focusing on too many things at once. Instead, the goal is to be selective and uncompromising. Other reasons CEOs may not accept change include unwillingness to deal with technology, unclear goals, unfamiliar scope, ineffective communication, and poor project management skills .
There is no “one size fits all” for change management; instead, emphasis should be placed on a flexible template associated with it and the ability to customize each template. Companies including Apple, Google, Facebook and YouTube have modified business models with changing times and technologies, along with Amazon, Walt Disney, Netflix and Spotify.
Change involves uncertainty, communication challenges, and chaos that employees often don’t appreciate. Therefore, CEOs must communicate with their stakeholders about the risks associated with Not change, even as they explain the advantages involved in embracing it and show the benefits. They must also involve stakeholders in the change process – be transparent and build trust – and remove institutional barriers, if any. Another important need is accepting feedback to improve decision making and motivate employees during development. They have to be patient and persistent, because change takes time.
See disruption as an opportunity, not a threat
The International Data Corporation reports that 60% of global GDP will come from digital organizations by 2022. This staggering statistic is also an opportunity in disguise if viewed optimistically and used effective use. Digital platforms can lower prices through new cost structures and provide new experiences for consumers. Therefore, instead of seeing technological revolutions as threats, CEOs must see them as opportunities and develop strategies to capitalize on them. Companies from Apple and IBM to Nestle and Hyundai have capitalized on that disruption and thrived. New technology also allows up-and-coming and/or small-scale companies to take on powerful organizations; Some, such as Alibaba, Airbnb and Uber have challenged the traditional giants and are thriving.
Disruptive solutions lie in out-of-the-box thinking and innovation with changing times and technologies. And mere sports knowledge is not always a solution; A more profitable path involves acting quickly and converting threats into opportunities.