During attritive economic times, luck alone doesn’t determine which organizations survive and which become extinct. Companies, like organisms, go through a process of survival of the fittest where those most attuned to the economic climate, technology landscape and political winds live to fight another day.
While this perspective highlights the importance of “fitness” to a given environment, there is one quality that excels in any environment: adaptability.
This lesson is coded into our genes. Humans evolved during a turbulent time in African ecology. Two million years ago, the climate and landscape of Africa alternated between woodland and grassland half a dozen times over a short period of time. With the varying climates, erratic food sources and inconsistent availability of water, the determining factor for survival didn’t come down to whether you were a grass-eater versus fruit-eater, or whether you had fur or didn’t. No matter what static quality a species had, they would tend to die off in whichever environment didn’t suit them.
What emerged from that period was a special animal that didn’t have fur but could wear clothes when they were cold; that built their own shelter that endured different types of whether; and that could find, prepare, and eat a varied diet.
Our world has already undergone so many upheavals in this young century that it’s become cliche to call whatever time we’re in “unprecedented times.” Human beings are a living, breathing testament to the most important lesson for how to survive in this type of environment: Evolve or die!
Here’s how to do it:
1. Continuous PPM
Let’s apply the above example to an organization: a company that is always focused on maximizing returns will excel in some environments and risk-averse companies will excel in others, but a company that adapts their risk profile to the circumstances around them will eventually outlast them both. That sort of assessment comes through portfolio management.
Project management will improve the number of projects that meet their specifications, but what good is that if the specs themselves are outmoded? Project Portfolio Management (PPM) is the systematic process for determining the best projects to do in the first place and continually considering if those projects are still the right ones to be investing resources in. New projects are “spawned” through ideation, the project population is “culled” through project selection, and then maladapted projects are “killed” through continuing governance.
The problem is, even when organizations have a rigorous portfolio management process, it is traditionally done on an annual basis. That won’t cut it anymore. Adaptability doesn’t happen through a big bang; organizations must adjust incrementally, reacting to change in an ongoing way.
Just look at the rate of change in technology alone. People have long talked about how 10-years worth of technology advancement in the 1900s translates into just 1 year of change in the 2000s. So using information from January of 2000 in December of 2000 was akin to making a decision in 1950 based on information from 1940. That rate of change is quickly approaching another 10-fold increase so that you need to reevaluate decisions on a monthly basis to keep from being the equivalent of a year (or a decade) behind.
Fortunately, these same technologies enable the very adaptability they necessitate. Keeping up with the rate of change created by emerging technologies is possible–thanks to emerging technologies! But with our increasing reliance on emerging technologies comes a proliferation of systems, licenses, processes, and data. This places a heavier emphasis on an approach that provides an objective organizing structure to otherwise complicated processes. This approach is PPM, and it can be a saving grace for an organization trying to keep pace with their technological capabilities.
But that’s only half the battle. Best case scenario, this article has convinced you of the importance of adopting a new, rigorous model. But how do you change in the first place?
2. Vision, Implement and Adopt.
It isn't just about math and science anymore. It's about creativity, imagination, and, above all, innovation. Organizations cannot compete on cost alone; innovation is CEO's #1 priority.
Business Week Special Report
We have transitioned from the knowledge economy to the innovation economy. But change and innovation aren’t just a simple “choice.” Many organizations have tried to implement changes, only to see no improvements. Others have been convinced of the importance of change, but remain fearful that they’ll cause a revolution instead of an evolution. Still others have decided to focus on innovation and are left with the question: “Now what?”
The good news is that there is a formal process for change.
So far we’ve compared business success to the evolutionary concept of survival of the fittest. However, evolution is not the ideal model for navigating turbulent times. In evolution, change occurs haphazardly, through random mutations that have no “end state” in mind. There was not a single human ancestor who decided to have genes that allowed for the development of a brain that was better fit for problem solving. It happened by a complete chance of genetic mutation, but once the strain appeared, the survival of such an advantageous quality was inevitable.
Organizations, on the other hand, should take a lesson from intelligent design. Regardless of your theological or scientific beliefs on the natural world and the animal kingdom, in the business world, we can “play god” and instill the order in our organizations with the best odds to succeed. You take chance out of the equation by taking deliberate steps to avoid extinction through planned change. You ought to be moving purposefully toward an end state that makes you best adjusted for the business environment.
This process is the Visioning step of the change methodology. In this stage, you:
- Assess the current state,
- Define your desired future state, and
- Build a business strategy (a plan for change) that will bridge the gap between the two.
The current state assessment is as much about evaluating the business environment as it is about examining your own organization. Given the conditions of the economic climate, what types of organizations are going to survive? What qualities will be favored? Which of these essential qualities is your organization lacking?
The answers you collect from this assessment should lend directly to defining your desired future state. This is the part of the process that that should resemble intelligent design. Now that you’ve researched the climate, know what resources are available, and are familiar with what types of organization are the fittest for the environment, you can move forward with an end state in mind.
To continue with the biology analogy, this is where you decide whether you are best suited to have fur or not—or if conditions are so volatile that only those who use clothing will be able to keep up with the climate. What diet ought you employ? Do you need to acquire largesse to become king of your domain, or is it more sustainable to be small and dependent on a smaller access to resources?
Once you know where you are and where you would like to be, you need to decide how you will get there: you need to develop a plan for change.
Some examples of plans for change include:
- Increase sales
- Meet profit projections
- Acquire new customers (increase share of the market)
- Innovate product offerings
- Hire and retain top talent
- Expand into new markets
- Cut costs.
You implement these plans via tactical initiatives that support the strategy. This means that projects are the vehicle for change in your organization. Companies who can’t consistently perform projects on-time, on-budget and on-spec, cannot effectively innovate. In other words, project management is how you change the way you change.
So if you plan the initiatives right and execute the initiatives properly, then what step could possibly be left? Well, by the time you map out your plan, develop the initiatives and complete the projects, things change: the economy fluctuates, technology progresses, opportunities to be first to market are missed, scopes creep, etc. You need to have a continuous adoption strategy in place to continue to adapt all the way through the initiatives.
By following the V-I-A methodology, you’ll have a reliable, repeatable way of changing and innovating, regardless of what the adaptation is, and by being adaptable, you’ll ensure your success regardless of what’s going on in the world around us.
For a trusted advisor in navigating the path to your desired future self, contact us here.
