This blog first appeared as Steve Wunker’s piece for Forbes
By: Steve Wunker
Many of us are reading more than usual these days – perhaps one of the scarce positive aspects of the COVID crisis. For business readers seeking inspiration on what comes after COVID that will enable The Great Reboot of their enterprise, here are two recommendations.
First, consider The Upside of Turbulence by Donald Sull, now at MIT and previously at London Business School when this work was published back in 2009. The book was written with the financial crisis front-of-mind, but the thinking carries over completely to our current times. Sull is a terrific storyteller, and his detailed examples draw from contemporary triumphs – such as Lakshmi Mittal’s forging of the world’s largest steel enterprise from the ultra-turbulent worlds of India and the crumbling Soviet empire. Equally, though, he provides deeply researched historical examples, such as how Harvey Firestone created a giant business from the massive scrum of tire companies fighting for share in the chaotic early years of the automobile.
The Upside of Turbulence contains at least three key lessons for the COVID era:
1. In the face of crisis, companies frequently exhibit “active inertia.” This phenomenon features firms undertaking a tremendous amount of activity, but all in the service of legacy business models and mental maps rather than conceiving an industry afresh. Companies able to break from these ranks and compete differently end up creating fortunes while others flail into insignificance.
2. Find opportunity, not just threat. Citing research by my former consulting colleague Clark Gilbert while he was teaching at Harvard Business School, Sull shows that companies confronted with identical changes thrive at much higher percentages when they frame the landscape shift in terms of opportunity, not just potential downside. It’s remarkable to see the proof of how eventual results depend so much on the way companies view the challenge in the first place.
3. Golden opportunity follows sudden-death threats. In industry after industry, Sull shows how winners like Carnival Cruises pounced when similar companies, like Royal Caribbean, held back. He’s clear that the answer is often not committing irrevocably to massive investments in the midst of crisis, but he shows that bold action can come in many forms.
Overall, Sull’s advice is thoroughly grounded and prescient for our current times. Indeed, we should take these words of his to heart: “Unexpected changes are not bugs in the world’s operating system; they are a feature.”
In a totally different vein, Vijay Govindarajan from Dartmouth and his co-author Manish Tangri from Intel have published this week The Three Box Solution Playbook. VG, as he’s known, is famous for distilling profound business advice into easily digestible and disseminatable stories and frameworks. His approach for business innovation uses an analogy of three boxes:
Box 1 – Manage the Present. For the great majority of business, the priority has to be the core business, which should be managed as a Performance Engine. The teams dedicated to this task are typically distinct from those building new growth ventures.
Box 2 – Selectively Forget the Past. This is a tough challenge for many firms, yet it’s essential to maintain agility and be ready for adaptation. That lesson rings especially true with COVID, as companies look to reboot their business models with new cost structures, new forms of customer experience and engagement, and sometimes new value propositions altogether.
Box 3 – Create the Future. It is this box that gets by far the most attention in VG’s new book, and which is particularly relevant today. VG takes the reader through specific ways to execute this objective, using detailed case studies such as how The New York Times built its robust digital business.
The book provides a wealth of tools, worksheets, and templates designed to bring a manager through a structured process from strategy to ideation to prioritization to execution. Readers may find its structured approach to borrowing from the core business (Box 2) and testing critical assumptions and experimentation for newer ventures (Box 3) to be particularly useful. While managers frequently have an intuitive understanding of the need to reboot their business given the COVID crisis, they can struggle with the how, and VG’s Playbook provides a step-by-step approach to arriving at the destination.
The strongest business literature feels totally current, and yet it has a timeless quality as well which enables it to endure. These two books reach that bar.
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