Resisting technology change is a recipe for trouble. Companies should embrace it using customer-focused thinking.
Have you heard the story about the frog in hot water, who boils to death before he jumps out because the temperature rises so steadily he does not notice? The internet and mobile technology have already brought about huge changes to society and commerce. As web and mobile savvy teenagers grow up, this change will accelerate.
My view is that many prominent people in the business community are failing to see just how quickly technology is changing the world. For those who have recognised the need for change, it needs to be done in a measured way, without hype or hysteria.
Regardless of the business you are in, being in touch with your customers and using customer-focused thinking is the best way to embrace change.
The big record companies are learning this the hard way. The ironic thing is that they’ve been there before, and last time they came out on top. Remember the days of cassette recorders? I used to copy tapes from friends after school – most of my friends were small-time pirates, and copying music was pretty much a norm.
The music industry focused on the customer, innovated, and along came CDs. There were huge advantages for consumers: better sound quality, durability and cheaper production. The world fell in love with CDs and before long we were once again paying for our music, and quite happy to do so.
Then the internet arrived and record company revenue was once again at risk. This time, major labels got scared and resisted the change. Instead of innovating to create value for consumers and artists alike, they decided to protect, encrypt and lock up their music, making it less accessible. But even worse, they threatened to sue their customers. Only a monopoly could contemplate such a thing. As exclusive owners of their artists’ products, the majors are monopolies.
On the flip side, innovators such as Apple have embraced the new technology. The iPod has transformed Apple into one of the great success stories of the past decade. Thanks to Apple (and finally some of the majors) we can now carry all of our music everywhere we go.
Many bricks and mortar companies (large and small) are now at the same crossroads the music companies were at a few years ago. Film and television, print media, paper-based classifieds and maps – these all risk being superseded by new models and paradigms.
The changes in communication and distribution mean a world of opportunity for innovators, and a world of pain for those who resist.
Many bricks and mortar companies (large and small) are now at the same crossroads the music companies were at a few years ago. What are the likely paradigm shifts in your industry? Is your business positioned to surf the wave or swim against it?
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Smart Company is a sister publication to The Mandarin, catering to Australia’s entrepreneurs, small and medium business owners and business managers.
