Can you remember where you were on October 22 1986? If the answer is London’s Oxford Street, then there is a distinct possibly you may have crossed paths with Sir Bob Geldof. For this was the day Sir Bob opened HMV’s new flagship store – at that time, the largest music store anywhere in the world.
It is difficult to imagine that the former Boomtown Rat, or indeed any of the people who were there at the opening, could have predicted that, less than 30 years later, the store would have closed and HMV itself would have gone into administration. Major corporations are so ubiquitous and fundamental that it is always tempting to assume they must be permanent too.
Yet, in reality, HMV’s story is not remarkable; it is the norm. Since 2000, 52% of the Fortune 500 have merged, been acquired or gone bankrupt. Just some of the household names that have disappeared or become far less dominant in that time include Woolworths, Blockbuster, Cable & Wireless, Kodak, Motorola, Nokia and Comet (which went from £2 billion turnover in 2008 to being sold for £2 in 2011).
Are there any organisations that are immune to obsolescence? The “too big to fail” concept has regularly been applied to those corporations, particularly banks, whose disappearance would be so catastrophic that it must be prevented at all costs. But is it not possible to imagine even these corporations coming to an end too, if not with a bang then with a whimper?
Let us take Jack Ma, Chinese billionaire and revered internet entrepreneur. Founder of Alibaba, the hugely successful ecommerce group, Ma is the embodiment of modern Chinese business confidence and an evangelist for trade without frontiers. He is also a staunch advocate of the cashless society, in which phone payments replace the use of notes and coins.
Now let’s indulge in a simple thought experiment in which Ma, or someone similar, decides to take on the mainstream banks, helping to create a fintech environment in which many established banking practices fall by the wayside. Where is the next generation of ambitious, tech-savvy talent most likely to gravitate: towards the traditional players or towards the challengers and innovators? And how will the retail banks be able to keep up, when they can no longer draw on the brightest minds in the industry? Don’t forget: “too big to fail” is only relevant if the organisation is, in fact, big.
If all organisations are ultimately doomed to fail, the real question is, how long can your organisation continue to thrive? With technology developing at an exponential rate, the answer to this question is increasingly determined by an organisation’s capacity for agility. Is your business set up to respond rapidly to change? Is it able to harness disruptive forces and use them to increase market competitiveness? Are your leaders willing to abandon approaches and strategies that have worked for them in the past in favour of the new, experimental models demanded by the future?
These are the questions all organisations need to ask themselves today – unless they want to become the HMVs, Kodaks and Blockbusters of tomorrow.
For a more detailed examination of organisational agility, and what steps businesses can take to achieve it, read our new agility whitepaper, authored in partnership with Dr Kiran Chitta, renowned organisational psychologist and industry expert on this important topic.
Keep an eye out for his next book, Strive: unlocking agility and unleashing talent in a digital world, to be published by Troubador in November 2018.
To find out how we can help you create a more agile workforce, visit sovaassessment.com