Monday, April 3rd, 2017 | 9 min read
When you go out to a restaurant, one of the first things they give you is a glass of ice water. An everyday exchange that we rarely notice, let alone think about. But within those indistinguishable ice cubes lies a deep story of innovation and some lessons in disruption from which we can all benefit.
In 1837, Rice and Kroener established the first brewery in Evansville, Indiana. At the time, the concept of a cold beverage was not commonplace. In the 1850s, ice started to become a prized commodity. Harvesters waited until the peak of winter, then traveled to a frozen lake or pond and carved out large chunks of ice. At the end of the 19th century, over 10 million tons of ice were harvested and used annually in the U.S. Ice transformed society in a profound way. It changed the way we shopped, stored food, entertained, and established an ongoing relationship with the “iceman.”
But while it was a thriving industry, ice harvesting had limitations – i.e., weather, location and seasonality. This luxury quickly became a year round necessity, and eventually fueled the technological invention of refrigeration.
Ice harvesting soon gave way to the ice factory. And in 1920, ice ranked ninth in investment among American commercial enterprises. According to the Census Bureau that year, there were 4,800 ice plants dotting the country, employing 160,000 people.
As successful as the ice factory was, it was not immune to disruption. In 1927, along came the home refrigerator, giving everyone their own personal “ice factory.” And just like that, the ice factory fell to its knees and the Iceman cometh no more.
In the span of about 77 years, the ice industry went through three revolutions. Natural ice gave way to ice factories that were ultimately replaced by refrigerators. And the leader in each period never made the transition to the next stage. They simply melted and disappeared like Frosty the snowman.
As a modern business, your chances of being disrupted are even higher. Roughly four of today’s top 10 incumbents (in terms of market share) in each industry will be displaced by digital disruption over the next few years. The threat doesn’t just apply to companies, but also to entire industries. According to research from Cisco, executives across major industries like hospitality, retail, and financial services perceive that there is a high risk of being put out of business altogether by digital disruption.
No matter how successful your company is today, there is no such thing as “too big to fail.” The unpredictability of the future makes it impossible to know what investment or innovation will prevail. The only solution for companies is to “lean in” to that inevitable change. To focus on disrupting yourself before someone else does. This means creating a company culture that embraces and enforces systemic changes.
But companies cannot transform unless the people in them – and the executives who run them – actively drive the agenda. Unless these executives are passionately dedicated to transformation. Here are a few suggestions on how business leaders can personally embrace change, and then apply it to their organizations.
As I pointed out in my last post, experience can sometimes be a bad thing. Your years in the industry could mean you are playing a new game with an old playbook.
At Cisco, we used reverse mentoring as a way to help senior executives learn from Millennials on how to use social media and other communication tools of today. In addition to strengthening their understanding, it also set an important precedent – breaking down the typical barrier between executives and employees, and empowering them to bring new ideas to the table. Ultimately, it helped us establish a culture of constant growth, healthy risk-taking, creative ideation and most significantly, it kept executives abreast of what was available. This was a win-win scenario for all involved.
Confucius said: “Better a diamond with a flaw than a pebble without.”
Voltaire said: “The best is the enemy of the good.”
Shakespeare said: “Striving to better, oft we mar what’s well.”
The common theme across these philosophical phrases is that you can’t wait for perfect.
I grew up at a time in business where perfection was the mandate. There were numerous instances where products were delayed for non-critical business reasons. But that was then, and this is now. Today, time to market and speed are much more crucial than perfection. Think of all the products that Google has launched that were “Beta” – there’s even a website dedicated to their A.I. experiments that anyone can test out.
The new expectation of the day: get your products to market aqap and work with your customers to improve them continuously. This is a shift in culture from perfect to good enough.
Organizational change is one of the hardest things to do as a leader. The larger the organization the harder it becomes. For that reason, when things go wrong, it’s a golden opportunity to leverage a change. You can execute a dramatic change during a crisis that would be impossible in a non-crisis situation.
So ask yourself, “If we experience a crisis today, besides resolving the crisis, what changes would I like to make?” Be nimble and improve your capacity – and willingness – to make big systemic changes after a crisis.
So if the you-know-what hits the fan, rejoice. Recognize that you have an opportunity to reinvent yourself. And use it to figure out how to improve your organization.
If you’re trying to transform your company – or even trying to encourage it to adopt a new idea – the biggest challenge you’ll face is influencing everyone else to change with you. You have to find a way to drive everyone around you to think differently, to go against pre-established rules, and to pre-emptively fix things that are not yet broken.
Do this by creating a burning platform for your company. Set your eyes on a competitor that your organization wants to displace. Or an emerging company that you want to stay ahead of. Make up a competitor if you have to. The key is to establish a powerful motivator that everyone in your company can rally around. A compelling reason for your company to disrupt itself, before disruption knocks on the door.
Think of culture as a cause, not a symptom. This means actively establishing, and sharing, the values at the core of your business. Do you have company values? Are they up to date? Does your team know them?
A study by MIT Sloan Management Review reported that, although 78% of managers and executives believe that digital transformation is crucial to their company, CEOs had only shared their vision of transformation 36% of the time.
Share your vision. Be deliberate about the environment you create. Let it be known: change has to be the new normal.
Everything changes. Truth is, it always has – just ask that poor guy with his frozen pond and rusting ice saw. Now, no one’s saying that handling disruption is easy. But by integrating flexibility, constant learning, and fear-free creativity into your own and your company’s DNA, you’ll be ready to handle change not as a one-off, existential crisis, but as business-as-usual. The key thing to remember, as Jack Welch would say, is to “change before you have to.”
This article originally appeared in Inc.