The future is already here, you just haven’t seen it yet.
A deep dive into the 5 sights.
What is the biggest threat or opportunity for business right now?
My hunch is that outside geo-political challenges, the majority of people asked are going to say something involving AI.
Seeing technology as the main disruptive force is not a new thing, even before the arrival of ChatGPT and its like, the world of business was already obsessed with ‘disruptive innovation’.
Technology, we are told, presents the ultimate challenge for existing companies trying to stay in the game, or, the greatest weapon for founders seeking to change the way the game is played.
Technology is only as disruptive as the beliefs that shape it
This blinds us to the truth: The really disruptive businesses often use new technology but they will always use unconventional beliefs and thinking.
If you look at the poster children of disruptive innovation, Uber and AirBnb: their technology wasn’t particularly new or disruptive, it was already being used in different ways, in different places long before they integrated it. This is true of their payment systems, in how they delivered peer to peer reviews and ratings, their tracking capabilities and beyond.
The technology was critical, it inspired new thinking, but it was their ability to question fundamental assumptions that enabled them to see what others couldn’t, so they could attempt to create value that other had not.
It was their maverick beliefs that created a potential new theory of value that they could then interrogate and try and deliver on, often through technology, not the other way round.
It was Airbnb’s ability to see latent room capacity in every home and every home owner that transformed where we stay when we are away from home. It was Uber’s ability to see a potential taxi in every driver, and every car, that revolutionised point to point travel.
The real problem: chronic strategic blindness
It is here we find the biggest problem for long term business success: strategic blind spots.
The most pervasive one seems to be what O’Reilly & Tushman call the ‘Success Syndrome’.
This is where the higher performing an organisation is, the stronger the systems to keep them doing what has made them successful in the past are: The KPI’s, the reward systems, the culture, is all designed to exploit what they are currently good at.
What that means is that their way of being is grounded in conventional wisdom. This makes it harder for them to explore what they might need to do to make money differently in the future. They are often very innovative, but in an incremental way, in smaller optimisations of the dominant design of an industry. Not the kind of radical leaps that can disrupt that dominant design and catch them off guard (Hotels and Airbnb, Taxi companies and Uber).
Or, they do make radical leaps, but then aren’t able to effectively commercialise it. Because the rest of the business is built for the old way of doing things, they can’t see how it fits with who and what they currently are: ask Kodak who invented digital photography, but then the likes of Sony Cybershot owned the new category not them.
But, you might be asking yourself - I am in a business, in an industry that is really quite stable, why would I bother looking for my strategic blindspots? Isn’t it a waste of our time to check our assumptions?
A fair question and it’s one I have asked myself many times. Here’s why I think it’s worth it:
Defend - Attack - Escape
By asking systematic questions of your assumptions, looking for new theories of value that may challenge your own, you can see potential problems before they arrive. You can challenge your busienss before someone else does it for you.
You can defend better.
If you find in that exploration a new theory of value that you think is worthy, you can then challenge your competitors in a way they may not expect.
You can attack better.
If you discover that new theory of value is better than the one you currently have, then you can then do something that most organisations really struggle with - reinvent yourself using the very capabilities that made you successful before, but in new and interesting ways.
Fujifilm is a case on point, they faced similar challenges to Kodak yet managed to evolve into adjacent domains:
By using their imaging expertise to create digital x-ray systems and other medical equipment they became a leader in medical imaging.
By discovering that the same antioxidants that prevented colours from fading in film could be used in skincare products they created a successful line of cosmetics.
Fujifilm, by reinventing itself, was better able to escape the boundaries of its threatened category.
You can potentially escape better.
A new theory of value: The ability to see value others can’t, by thinking what others don’t
So how can companies consistently think differently, and how can they then integrate the new beliefs that emerge into what currently exists?
I use an approach inspired by Professor Todd Zenger’s brilliant ‘Theory of your firm’ thinking, then shaped by my own Oxford work and experiences working with companies large and small all over the world.
The antidote to chronic strategic blindness: 5 ‘Sights’ & Convictions
This is a deep dive into the why, the what and the how:
